Solving the Housing Shortage with Respect with John Delia Jr

Episode 67 • 4th January 2023 • Construction Disruption • Isaiah Industries

John Delia Jr.:

Once again, to onboard a new generation, if you can put them inside of an offsite facility, if you can create in-house training programs and in-house safety, I think that that's what brought the rise of the car industry. When you look at Ford and what we were able to do there. So I think that, you know, Elon has helped innovate. You know, Henry Ford has helped innovate. And I say to myself, who's going to help innovate the construction industry?

Todd Miller:

: 00:00:33

Welcome to the Construction Disruption podcast, where we uncover the future of building and remodeling. I'm Todd Miller of Isaiah Industries, manufacturer of specialty metal roofing and other building materials. Today, my co-host is the inimitable Seth Heckaman. How you doing, Seth?

Seth Heckaman:

: 00:00:52

Doing well, Todd. How are you?

Todd Miller:

: 00:00:53

I'm doing well, too. I don't know where inimitable came from, but it was a fun word just to try to say. So let's dive right into our episode today. I've been looking forward to this episode and excited to talk with our guest. So our guest today is John Delia Jr of Housing Joint Venture and Green Monkey Builders. John is very much someone who is shaping a new approach to construction and real estate development, making him a true disruptor in our industry. John actually bought his first property in 2010 at the age of 20. He is a second generation real estate and land developer as well as housing provider. Based in Detroit, he is operating in several Midwest cities, owning single family homes, apartments, land, and even industrial buildings and warehouses. I know that you're going to be very interested to hear of his unique approach to things and really the way he is changing and mapping out a new future for construction and development. John, thank you so much for joining us today on Construction Disruption. I'm looking forward to a great conversation.

John Delia Jr.:

: 00:02:02

Howdy, guys, and thanks for having me. It's an honor to join you guys on the show today, so I look forward to the conversation.

Todd Miller:

: 00:02:08

Very good. Well, one thing I do need to clue our audience in on also is, we are doing our challenge words. So each of us on the show today has a word we are challenged to work into the conversation. You are welcome to, kind of as you listen along, see if you can pick out some unusual word we're working in and maybe you'll figure out the challenge words. At the very end, we'll come back and say whether we've been successful or not. So, John, I'm not even sure where to start with you, you're involved in so many projects. You're doing a lot of cool stuff, a lot of groundbreaking stuff. So, well, let's just start at the beginning, I guess. I know your family was involved in construction and real estate, so you kind of grew up in this industry and around it. Tell us a bit about that. You know, growing up in the industry and what made you decide that you wanted to follow the family trade?

John Delia Jr.:

: 00:03:00

You know, I'd like to say I've been on construction sites and under boardroom tables since I was a child. But, you know, my favorite phrase was, I'm hungry. When are we going to eat? My dad's shuffling papers in the middle of meetings. I'm like, when are we going to eat? So, you know, very much construction, real estate development has been in my background for a long time. Native of New York, grew up on Long Island, where my father was a homebuilder. So, you know, I got the luxury to see different job sites in different developments, but once again, not really recognize the significance of kind of what was happening or the significance of heavy equipment or machinery. I did buy my first property in 2010 at the age of 20, and I'd like to think I'm just a good, disciplined son or a decent robot, as we might say, where, you know, I listen well and execute and really, you know, coming from New York, I left New York around 20. So coming to the Midwest in Ohio, to me, the purchasing power was incredible. So, you know, 6900 to me was like, oh, my God, this is free. Where in Long Island you can buy a new car for that price. Sure. So when they were selling houses, foreclosed houses for that price, I kind of listened to my father who said, hey, you should buy a house. You should buy a house, you need to invest your money. You know. And at the time, I was probably more of a consumer buying, you know, denim and sneakers and all those things that kids love to do to show off and hang out with the friends. So that kind of brought me down the path. And from there, you know, I kind of stuck with it ever since.

Todd Miller:

: 00:04:28

Very cool. So what happened to that investment in 2010 for $6900 at the age of 20? Did it work out for you? Do you still own that property?

John Delia Jr.:

: 00:04:39

So I don't own it, but I love telling this story on how I failed forward. So with that house, I owned that house for 30 days and it actually helped inspire my first book that I wrote. And essentially I bought this house in cash. It was a VA foreclosure, 200 Williams Avenue. I still remember it, and it was a duplex. And not only was it a duplex, but I owned half a block and didn't even realize it because the 20-year-old me was still somewhat unconscious to the seriousness of what was going on. But once again, I was being a good, obedient son. Anyway, I remember getting to the job site on the first day and there was actually roofers on my roof tearing off my roof, and I got into my dad's truck and like, What's going on? What is this? Who are these people? He's like, yeah, I hired some people to come do your roof. You need a new roof. I was like, No, what are you doing? You're fired. This is my job, not your job. You know really, I'm a junior and I've always had that junior behind me. And I think for this for this project, I think not only did I fire my father, but I wanted to take leadership. I wanted my own perspective. And I felt for the first time since I was using my own money, I should get to determine who the stakeholders are and how the deal goes. Anyway, I got to occupying one side of the duplex. I still remember, bless her heart, Brenda and her sons helping her move in. And during that project I got taken advantage of because I fired my father and other contractors, recognized I knew nothing about mechanical, electrical, plumbing or anything like that. And the gentleman across the street, Michael, you know, Michael had an MBA, a Ph.D. He owned a trailer park across the street. And my property was just as large as his lot, but he had a trailer park on it. Anyway, Michael wanted to help me and I ended up selling him that house for, I think $24,000, something like that. So I made $10,000 on the deal. 30 days later, I called it a gut check. And my thing was I didn't want to actually go back to my dad and say, hey, I failed, I need help. So I just snowballed that into buying another foreclosure and repeating the pattern, but this time a little bit more aware and not wanting to mess up as much.

Seth Heckaman:

: 00:06:44

What a great story and just encouraging for anybody out there diving into some entrepreneurial venture at whatever age, let alone twenty, that things are going to go cattywampus at some point. So you got to just have that perspective that you're going to learn and grow and learn your lesson now and leverage that lesson on moving forward. So very cool. Anything else that stuck with you or you're you're still gleaning from that project today?

John Delia Jr.:

: 00:07:10

So the economy was much different back then, but I'd say that my investment thesis in pattern recognition developed with that project. So at the time I actually, I had gotten into real estate license at the age of 18, which gave me access to the MLS. So by the age of 20, I used to want to be in the stock market and my dad's like, Hey we're real estate guys. So I took my value investing thesis that I would call in the MLS, so I'd like to call it pattern recognition, where I figured out the investment category, product type, and price range that I felt competent with. And I just repeated the same type of houses over and over and over. So I think that that helped recognize and solidify my pattern recognition and then I bought that type of HUD foreclosure, you know, a multiplicity of times.

Seth Heckaman:

: 00:07:55

Finding your niche and just rolling with it.

John Delia Jr.:

: 00:07:58

Exactly.

Todd Miller:

: 00:07:59

How quickly would you turn those? You said the one was 30 days, which seems really quick to me. How quickly would you, is that typical of what you were doing back then?

John Delia Jr.:

: 00:08:09

Typically it was 90 days, so yeah, typically was 90 days. I mean, I come from a real estate background. So when I moved to Ohio, we were doing large-scale multifamily redevelopment. We started off in HAP contract in Section Eight housing. So when my dad put me on the job site with a completely gutted, I was like a babysitter essentially, but in a completely gutted house. We weren't able to fail inspection. You know, you only get a couple of strikes and then you're out of the program. So, you know, it was a matter of efficiency, productivity and, you know, managing the workers, being a leader. So at the time, I'd say 90 days was a pretty realistic turn of a unit.

Todd Miller:

: 00:08:47

Interesting, this is just all new stuff to me. I've never been involved in any of this, so I'm learning here. This is great. So now, you know, in recent years you started a company called Housing Joint Venture, which as I understand, is a way really for anyone to invest in real estate projects that you're developing or you're managing by buying shares actually online. Can you tell us more about that and how that works and maybe direct people how they could get involved?

John Delia Jr.:

: 00:09:15

Sure. So, you know, once again, at the age of 18, 19, 20, I pretty much didn't have great access to credit at the time. I mean, I was still a ghost when it came to credit. So I didn't have real lending. My father wasn't going to really cosign on loans because obviously I'm a young guy and I'm going to stumble forward. But what I realized was, is I had to get creative with financing. So initially, I would take my, you know, earned income from working at the multifamily and I would save it and then buy houses in cash and kind of pay for them. But eventually, I wanted to keep growing as most ambitious people do. So I recognized that I would need another capital source. So back then what I would do is I would go to all the investor meet ups and I walked around with my my briefcase and essentially my business plan, which was essentially the pattern, the thesis, the costs, the etc.. And, you know, eventually well, back then they used to sell these promotional courses at these meet ups. And I was like, Oh my God, if you can afford a $5,000 course, if you could partner with John and John's doing it. So really my attorney at the time, David, helped me develop this joint venture method where John owned houses and cash. And if we have a partner, the joint venturee, they could bring the cash. John would act as a developer, do the day to day operations, and in a partnership we'd make the executive level decisions together. But John would operate the asset, manage the asset, do the tenant selection, etc. and then we would both benefit from the upside and the equity. So, you know, I've kind of taken that business model that worked well once again, a pattern and we continue that thesis moving forward. So whether it was self-directed IREs where people needed to be passive from the day to day due to the regulations, or if they do want to act almost as the franchisee where they get that executive level decision making, but they're an engineer and be a corporate professional and they don't really need extra stress in those phone calls for the contractors.

Todd Miller:

: 00:11:08

Very interesting. So are you still operating some that way? I know the website is out there and there's properties on there.

John Delia Jr.:

: 00:11:16

So those are real deals and real properties. We have land, we have buildings, we have assets and we're still doing joint ventures. I think it's still a matter of relationships. And as I mentioned, we're almost trying to do what's known. It's like a developer in a box. So rather than sell people the training and the courses, I was a coach, I wrote a book, I did the meet ups, but I recognized people paying me tens of thousands of dollars for education isn't necessarily the best use of funds. I mean, you could put those funds to a deal and the best way to learn is hands on. So now it's it's real estate development with training wheels, where you get our systems, you get our infrastructure, you learn how to develop a thesis. You learn what the documentation should look like, what the standard operating procedure should look like. And then from there, if you want to keep expanding, at least you have a basis for understanding what success looks like.

Todd Miller:

: 00:12:05

Wow. So the book you've written, this is the first I'd actually heard of that, somehow I missed that in your bio. Tell us about that.

John Delia Jr.:

: 00:12:13

So that book published in 2017, Life, Liberty and Property: A Guide to Successful Real Estate Investing. So I think we all know the founding fathers and life, liberty, and the pursuit of happiness, but it was initially life, liberty, and property. So, you know, I took that thesis and it was just once again, the first chapter is I thought my millionaire dad was a bum because what I didn't recognize, most people think real estate is about the cash flow or the quick flips or that income, and really real estate buys you your time. So when my father had the luxury to be home, cook dinner, take us out, and all these other parents were kind of busy professionals and always working, I kind of thought, Are you unemployed? But what do you do? You know, like, do you have a job? I thought you were a bum, you're on the couch. And so, you know, sharing stories like that. And then how to create your real estate strategy and business plan. I think that people need to understand their KPIs. How do you quantify success? When someone says, I want to invest in real estate, I typically ask them, How much money do you want to make? What's your time horizon? So I think we have to get really pragmatic and specific into the details. And that book was kind of like the framework for writing your strategy and your business plot.

Todd Miller:

: 00:13:22

Wow, I love that. You know, and so many people out there are looking for those frameworks. And, you know, a lot of times you'll read books and you'll read things and they don't really teach you how to do it. They give you an appetite for it. But I love the fact that your book actually, you know, dives into the pedagogy of, you know, how do you do this? So this is teaching you how to do it. And that's that's great stuff. So, you also have a business called Green Monkey Builders. I have to ask where that name came from, first of all. But tell us a little bit about that, too.

John Delia Jr.:

: 00:13:57

So, you know, I've had iterations of different companies that help facilitate the business. And I realized that, you know, we have a property management. I was a self property manager, I was an owner operator. And I realized that even the term landlord can be loaded and charged. And now I use the term housing provider. So I realized that sometimes people have a bad experience with the property management or a bad experience with their contractors. So Green Monkey, my wife has her family origins from Barbados, and I remember we were down there for our wedding on this island and we're playing with these green monkeys. They come up to you, they touch you, they're playful on the beach. So it's an actual real monkey. And I thought to myself, Well, she recommended the name. And I thought to myself, You know what? If you ever got a hanger from the maintenance guy who missed you, what if it was the tail of a green monkey hanging on your door? And I thought about the branding of trucks like transit vans in the streets and this big green monkey on the side of the van. So just like Atlas Butler or any other Mr. Clean, you know, from a branding and marketing standpoint, I was like, Oh, it's kind of playful. It's kind of fun. You might be, you know, charged a little bit because it's a monkey and people don't want monkey business. But I think it's just the spirit of our values, of having fun, being playful, enjoying what you do.

Todd Miller:

: 00:15:10

Well, it is certainly fun. It's certainly fun. So that's the operation that you do a lot of your development through then. Are you doing building for your own projects through Green Monkey or are you subbing a lot of that out or how does that work?

John Delia Jr.:

: 00:15:25

So how it currently works is we act as the construction manager and we do do some of the trades internally. We sub out most of our MEP. So we work with a lot of licensed professionals to kind of put in that infrastructure. We work with obviously the normal civil engineers, architects, surveyors, structural guys, etc.. But things like demo, things like flooring, painting, finish carpentry, etc.. You know, I have a crew of internal guys who have been with us for quite some time and you know, we work together to kind of push those projects to completion. So we have part of an in-house team and then a lot of other stuff just gets subbed out.

Todd Miller:

: 00:16:01

Very good. So I know that you have a real heart and passion. It's right at the front of your LinkedIn profile and you have a real passion for preserving and rebuilding older structures. You know, when you do that, I think we all realize you run into challenges and find interesting things, but yet, you know, you're still doing what you know to be the right thing. Do you think rebuilding is something that's going to, I guess I'll say we'll see more of in the future? Or do you think that the future is going to bring more of a trend just toward teardowns and rebuilt?

John Delia Jr.:

: 00:16:37

Initially, when I got into the business and I wanted to be a real estate developer, I said to myself, There's plenty of old structures around, why would I build new? It seems wasteful. These houses are going to go to a landfill, I can rebuild them. So I spent a decade doing 100-year-old houses. You know, these were first-ring suburbs just outside of an inner city or in the inner city, you know, typically brick buildings, etc.. And essentially, we have to rebuild these structures, you know, down to the studs. And with it, you do find, you know, not square rooms or knob and tube, or pulleys in the window and, you know, and cast iron galvanized pipes inside the wall that have corroded from the inside that you have to rebuild yourself. So I think that the 100-year-old buildings made me not only have a love for housing stock and the integrity that the Old World used to provide. But it also made me what I call a construction cowboy and an expert in understanding how buildings operate, how to maintain, and what's the preservation aspects of it. So I think that there's going to be a category of projects. We do projects for an example in Detroit, where some of the Spanish colonial architecture we want to preserve and we want to bring back to the next hundred years. But I will say to the point of tearing down some of these buildings because they've been neglected and off the grid for so long. At this point, I do believe, and I hate to say it, the highest and best use is to tear those structures down and start from scratch, because to be honest, the nuance of the repairs of these structures is very specialty. And I like to tell people it's not necessarily scalable because it's a custom business. Every time I go into one of these structures, it's a custom project. And once we open those walls, there's a lot of uncertainty. So as we mentioned with Housing Joint Venture, what I recognized was we don't want to go back to our partners and say, Hey, Todd, we opened up the wall like Chip and Joanna Gaines say, and it's going to cost you more money. That's really kind of frustrating and unpredictable. So where are the market? And where we're moving towards is infill structures and ground up development for new buildings that we believe can last the next hundred years.

Todd Miller:

: 00:18:44

Makes a lot of sense.

Seth Heckaman:

: 00:18:45

Yeah, and referencing that custom work required on those those older structures, that's a whole other level of craftsmanship too, for the skilled labor that you need to source in order to do the work. And who actually knows what needs to be done. Over your twelve years from the first property to now, what is your perspective been on this supply of skilled labor? We hear all the time about it being short, of course, but what are you seeing?

John Delia Jr.:

: 00:19:10

That's exactly it. So my workforce is 55+, even some in their sixties. You know, I learned an apprentice, his name was his nickname was Teach. He was in his seventies when he was teaching me the business and when I mean the business, I mean the Old World construction techniques. So I think guys, you know, master plasterers and carpenters and specialty framers, that generation is really not existent, not as abundant. And I find that the younger generation really today, obviously, we need to pay our employees and our workers well. But I think there there's an unrealistic expectation of where the starting, you know, wage should be and the types of work you're doing. Once again, if you're doing 100 year old structure in those type of demos, it's dirty work. And I think Jeff Bezos put those Amazon trucks on the road. And now you say to yourself as a young person, Do I want to drive for 20 bucks, 25 an hour, an Amazon truck, or do I want to be demoing an old house, getting dirty, covered in dirt? So I think that the transfer of knowledge is going to be important and critical. I think obviously because of technology, because of them and a lot of other technology, there's an opportunity to transform and train. But there are the labor shortages. And unless you keep that workforce active and engaged and treated well, they will leave and go to the next, you know, employer.

Seth Heckaman:

: 00:20:32

Yeah, that's an interesting convergence of those two ideas of, you know, the what's efficient and, you know, what's the best use of time and resources now to rehab versus just start over. But it may also be a evolution of technology in terms of methods that are going to then appeal more to younger people to get into this business versus maybe making it less backbreaking and less dirty and all these things that have been detractions from our business up to this point. So that's interesting. I hadn't really thought about addressing it by, you know, okay, let's look at methods and technologies and starting there, backfilling then with the labor that's going to appeal more too.

Todd Miller:

: 00:21:10

You know, I may sidetrack us a tiny bit here, but this is something I was thinking about earlier this morning. And John, I loved what you said and that, you know, you're adopting some older workers and having them as part of your team and such a great knowledge and skill set there that you're benefiting from. But yeah, one of the things I was thinking about this morning, someone had asked me, you know, what the greatest challenge is facing our industry and you know, if you ask 95% of the people in our industry, they're going to say, well, the challenge is lack of workforce. But, you know, my answer really was the challenge is going to be the transition of baby boomers and some other folks out of the workforce and, you know, the great loss of knowledge that that's going to bring. But by the same token, and I'm, I guess, what they consider a very young boomer, I don't identify too much with that. I feel like a more Gen X. But anyway, you know, I think that baby boomers generally, by all they're complaining about the younger generation, have kind of alienated, and not done a good job generally of building leadership among younger folks. And so to me, that's one of the challenges we face as an industry is, hey, we're going to lose these older folks. They got to start building into the younger folks and take it seriously. So anyway, I entirely sidetracked us there.

John Delia Jr.:

: 00:22:32

Well, to your point, Todd, I think that's actually a great opportunity to have the transference of knowledge. When I think about, you know, I skipped out on the gaming and a lot of the fun activities that young people would do because I committed to being a professional at a young age. However, when I look at technology today, let's say the example is the Oculus by Meta. You know, if we were able to take the older workforce. And my workforce, although I'm paying and I'm the employer, I feel like I'm paying to learn because what they know and that knowledge is so valuable, that's what I'm really buying. Now, I think to myself, Oh my gosh, if I was a great technology company, I'd love to purchase their knowledge and then put it into maybe the AR/VR experiences. So where these kids are gaming, you're gamifying the construction process, you're gamifying, you know, digital renders, you're gamifying that kind of experience that also entices the new generation to maybe get active and understand what it's like and what it can be without being on the job, but at least being immersed in the experience.

Todd Miller:

: 00:23:36

I love that. Yeah, that's good stuff. Any time you can gamify, in fact we did a whole episode where we talked about gamifying the industry. That's good stuff. So I want to talk a little bit about, you know, the shortage of housing and in particular affordable housing. And it sounds like you have a real passion deep inside of you to to try to meet that through your projects. What do you see as some of the most effective ways to address that concern of the shortage of affordable housing?

John Delia Jr.:

: 00:24:06

I believe initially to start, we have to shift the language and the lingo. I think that there can be a lot of NIMBYism of projects and developments that come along the way. And I think that the term itself affordable is charged because is it affordable for the AMI, the average median income of the area? And what we've done in our projects is we say budget-friendly because everybody has a budget. Your budget may vary, but everyone has a budget. So I think the language of what affordable looks like and what affordable means is charged in the industry. And I think that that needs to shift first. But secondly, I think that, you know, the knowledge of the industry is really hoarded among those who really know and those who don't. So I think that there there has to be more of open source of sharing information, sharing resources, and helping people understand the interdisciplinary aspects of how the industry operates. None of us operate in silos, and we require so many different stakeholders to participate, to move a project forward that I think that there needs to be the the sharing of knowledge of the, you know, the interactions between stakeholders.

Todd Miller:

: 00:25:14

Very good.

Seth Heckaman:

: 00:25:15

So when you talk about budget friendly then and thinking about your projects, are you shooting for that AMI, or do you have a target of being able to serve less than that? And how feasible has that been for you in planning and production?

John Delia Jr.:

: 00:25:31

So it definitely comes down to the cost. I think that because I've had the privilege of working for over a decade on the job as a construction cowboy, I think that there's some efficiencies in the building process that you can you can move some of the trades a lot quicker than some of the MEP in the cost structure. So I think what we like to do initially was preserve existing housing stock. We would do more of a repair, restore, remodel, we would do the replacement of MEP, but we would keep existing hardwood floors and we keep some of the trim work. We would try to find areas where we could value engineer our savings. That way we don't have to overly raise the rents, etc.. Now I also don't believe in displacing existing residents in a community. So for our initial investment thesis, we would go into areas that were one third vacant, one third occupied by homeowners, and one third occupied by renters. And what we found was, is that if we could fill those vacant units and bring the new comps and the new values, we could help provide budget-friendly housing. So I think too often the challenge with real estate in the financial modeling of the performance aspects are what's your time horizon? Horizon on rate of return. So if you're looking for quick comps and quick flips, the model doesn't work. But we we've taken a market maker approach where we say, hey, let's buy a critical mass of units in this area. Let's bring the standard of renovation and development up to snuff, and then let's create a base level of rental rates that we want. And we've been able to create our own comps and our own values. And I'd say that there's a shortage in most American cities today, and a lot of people are just looking for dignity, respect, and quality housing. So when you put that quality product on the market, we have more than enough qualified tenants who move in. And people used to ask me, Hey, John, why would someone want to move on to a street where there's vacant housing? And it's it's not about the vacant house. It's about the rebirth of what that community represents. And those people want to be a part of that shift and want to be a part of that process.

Seth Heckaman:

: 00:27:32

There's a popular neighborhood in Cincinnati called Over-the-Rhine that, you know, has had a I'm sure you are familiar with it. So over 30 years ago, it was, you know, murder capital of the Midwest and has grown and now it's has kind of swung the other direction. Where its been accused of some gentrification and displacement and other things along those lines. But my wife and I like going down there and, you know, eating at good restaurants. And we're seeing these new developments of mixed use properties of some retail and restaurants with then luxury condos at top and even some, I think it's Section Eight housing in the middle and just trying to really blend all of these dynamics together. Are you seeing that trend? Do you see it continuing and have you been involved in any of those type of projects?

John Delia Jr.:

: 00:28:14

So we have been, you know, Over-The-Rhine. I've actually gotten to personally be there. And, you know, I will say years ago it was scary. And after a certain point at nighttime, you have to leave the neighborhood. But anchors like the Findlay Market and other institutions and employers have obviously helped, you know, push the neighborhood forward. But to my point, earlier of pattern recognition, American cities face the same pattern where the post-industrialism of the inner cities and then the shift to moving to suburban sprawl and now urbanization again is re-occurring. So, cities will rise again. And I think that we are going to have to create the mixed income communities that actually make a city what a city is. So you don't just want one genre of homogeneity of the same people. You kind of want to know the locals and the different flavors and get the different tastes of life, because that brings the enjoyment of life and culture and all the things we love. So I do see that pattern happening across American cities today where urbanization and gentrification are occurring. But I think if we, I don't want to say dial back some of the flipping, but I think there needs to be the humanity aspect of it as well.

Seth Heckaman:

: 00:29:24

It goes back, I forget all three words you used, but that dignity and quality that people are looking for and just yeah, have that human connection of everyone benefiting in the exchange for sure.

Todd Miller:

: 00:29:35

John I loved your comment about, you know, wanting to avoid displacing people. I live in a town of about 20,000 and there was a oh, I think it's probably a 10 to 12 unit building, residential building that recently sold. And for years, you know, it had been livable. But, you know, borderline not the best, but it was very affordable housing for some people, including a good friend of mine. He got displaced, everyone got displaced when the new owner came in. And, you know, now his apartment is 1500 dollars a month there, which he absolutely would not be able to afford. And so that that kind of broke my heart to see that. I often thought, gosh, can there have been a different approach to this that, you know, would have gotten him in a better situation and, you know, allowed him to stay in the place that he loves? Anyway, I was glad to hear you say that. So one thing I want to touch on, we talk a lot here on the show about offsite construction and modular construction. A lot of folks feel that that's going to kind of be the answer to the future, you know, meeting our housing needs in our country. Any thoughts on that?

John Delia Jr.:

: 00:30:44

That's a great question. And I'm glad you've kind of put pointed us in this direction. I actually believe that offsite is going to be one of the key elements of the future. I think that there's a huge opportunity for efficiencies and quality control with offsite. If we look at most job sites today, we're still using the same stick framing methods on site. Drop a lumber package down, requires specialty labor with specialty knowledge to frame it on site. You also have 20 to 30% waste that you're using lumber products, not to mention if the product is warped, if it's not plumb. If your concrete contractor comes and needs to use a form, so he picks up from that pile. So, you know, there's a lot of uncertainties when you're building on site. For us, we actually believe that we want to move towards more offsite production, you know, where you can monitor the quality control and you could create some efficiencies. It also creates a better environment and safety for the workforce and the labor. And I think once again to onboard a new generation, if you can put them inside of an offsite facility, if you can create in-house training programs and in-house safety, I think that, you know, that's what brought the rise of the car industry and when you look at Ford and what we were able to do there. So I think that, you know, Elon has helped innovate. You know, Henry Ford has helped innovate. And I say to myself, who's going to help innovate the construction industry?

Todd Miller:

: 00:32:05

Very good point. You know, we had a one of our recent episodes was with Paolo Tiramani of Boxable, and they're building modular units to address affordable housing, as they call it. But yeah, he's definitely a leader, but he himself is quick to say, I don't know if we have the right recipe for this or not. Time's gonna tell. But it's interesting. There are some great folks out there trying to figure it out, and I commend you for what you are doing to walk us through that as well. So we think a lot of our audience members here at Construction Disruption are younger folks. Any general words of advice for folks starting out in their career? And then, you know, I love what you did, getting started so young and you know, you've done so much and you're still a young guy. But any words of advice for folks who are getting started in this industry?

John Delia Jr.:

: 00:32:57

You know, I think that today, more than ever, platforms like LinkedIn are extremely powerful because it allows us to network outside of our market. I know when COVID came, it shut down the ability to go to in-person meetups and conferences, and that really was a drag on, you know, building relationships. But I think platforms like LinkedIn allow us to connect with new tribes and use keywords to seek out and search information. I also believe that once again, with technology and YouTube, I learned so much by typing in, you know, keywords on YouTube. So finding your tribe on the Internet, you know, being willing to stay curious and get curious. And then with anything, you have to have the willingness to want to become a technical expert. So whether it's picking up the building trades textbooks, whether it's going for a builder's license, whether it's, you know, apprenticing or being hands on, you know, or learning some of the software or the bin programs, etc.. I think that, you know, young people have to get engaged, have to get in hands-on and then hopefully find some mentors. Because once again, the older generation who has been around have a lot of knowledge to give and share on what they'd like to see. And that's actually what's helped push us towards innovation. You know, some of our older gentleman have said, John, you need to do it this way. Aw, man, it's wonky. Why do we still do it? And I'm using Paul's voice to be funny. But, Paul, helped me see, you know the benefits of cold formed steel, CFS, or light gauge metal and you know, in residential construction it's still only 2% of the industry. And if you add that on top of offsite, I'm like, wow, guys, we have a huge opportunity here. And if I open my building trades textbook, there's a whole chapter on it. But you know, we're seeing things be done the way they've always been done. So I think young people ask the questions of why and why and why.

Todd Miller:

: 00:34:45

Very neat. And I loved you mentioned earlier to me before we started the show, I think that you were using a lot of cold formed steel, CFS in your construction. That's very needed. Is that something fairly new for you or is that something you've been doing for a little while?

John Delia Jr.:

: 00:35:00

It's new for residential new construction. So per building codes in certain environments, you have to use a noncombustible material for renovations and permitting. So in our multifamily, we were using it. Now in terms of the usage for residential construction, it was actually once again the benefit of having older employees. Paul was in his sixties, previously worked for the Lottner Trust, an architect out in California. And, you know, I was asking him, hey, can you review these plans with me? I need some advice. Anyway, I was working, I'm still working on my first subdivision, which is a 17-home subdivision. And at the time, commodity pricing and lumber pricing was going crazy. And I said to myself, oh, my gosh, how are the margins? How are we going to have a predictable, cost-effective product? And Paul had really pushed me to look into metal, which I had never seen applied at a residential level. We've seen it in office. We've seen it in mixed use, but never at the residential level. And once again, as I began to do that research and uncovered it, I realized that it's in the code, it's being used in other environments such as California, Florida, etc. But in certain Midwest environments, for me in Ohio, I haven't seen it. So for us now we're looking to do strictly CFS for new residential construction. We believe that it's a great method for rapid framing. We also recognize that, as I mentioned earlier, with typical lumber, you know, you have 20, 30% waste and that product's just being wasted. If you use CFS in certain roll form technology, you're able to get it within 1% precision and utilize BIM to production to output. So once again, if we have a facility we're building in Michigan to do CFS offsite construction where then we can drop off a kit of parts, we'd like to call it eventually either the IKEA of home building or the Tesla of home building. We can take those kit of parts, assemble them, create some excitement for the young people who get to see a rapidly produced structure and then, you know, build efficiently. And if we can bring the time for erection or construction down. Obviously, with time, value of money and savings, we could hopefully provide a budget friendly product.

Todd Miller:

: 00:37:13

Wow. I love what you're doing. I tell you, every everything out of your mouth is just so much in line with things we've discussed here on the show and where the future needs to be. So you got it all happening and that's great. Well, we're very close to wrapping up the business end of things here. And this has been a real pleasure and a privilege. Is there anything that you haven't shared with our audience today that you'd like to share, John?

John Delia Jr.:

: 00:37:36

No, not quite. I mean, I'm going to have to prepare for the holidays and get the poinsettias on my porch and make sure the decorations are beautiful. But otherwise, I'd say that your show has actually been a great resource to me as well. I remember you had a guest, Stephen, from was it John Burns research as well?

Todd Miller:

: 00:37:52

Correct, yep.

John Delia Jr.:

: 00:37:53

So when I think about the opportunity, the data and information, even for me stumbling upon your show, I think it's an excellent resource. So thank you guys for hosting and really facilitating this dialog.

Todd Miller:

: 00:38:04

Well, thank you. And you're right, John Burns Real Estate Consulting, it's called. But they're great data and information there, and it was interesting, they just released something this week that caught my eye. You know, everyone is kind of saying, okay, you know, residential remodeling will probably be down in 2023, but they have the data to back up that it is going to come back roaring in 2024 or 2025, just based upon the age of homes and the age of our building stock out there. So very, very good stuff. Well, before we close out, I have to ask you if you'd like to participate in what we call our rapid-fire questions. So these are seven questions, they may be serious, may be silly. All you got to do is give an answer. And our audience needs to understand if John agrees to this, he has no idea what we're about to ask. So, John Delia, are you up to the challenge of rapid-fire?

John Delia Jr.:

: 00:38:58

Let's do it.

Todd Miller:

: 00:38:59

Awesome. Haven't had anyone refuse yet, thank goodness. So we will alternate asking questions. Seth, I will let you go first.

Seth Heckaman:

: 00:39:07

All right. Rapid-fire question number one. John, what is your favorite morning beverage?

John Delia Jr.:

: 00:39:13

Coffee.

Seth Heckaman:

: 00:39:14

There you go.

Todd Miller:

: 00:39:15

I'm right there with you.

Seth Heckaman:

: 00:39:17

Do you have, like, coffee routine? What's your favorite method? I need more details.

John Delia Jr.:

: 00:39:21

So for me, my grandmother used to make me coffee at a really young age. So I do an in-house pour over where I have the actual basket strainer. I put the ground beans in it through the filter and then I pour the hot water over it, let it steep for a second and I do my own pour over in-house, you know. So it's very great. I also have an aeropress that I love using that really works well as well.

Seth Heckaman:

: 00:39:42

Yeah, awesome.

Todd Miller:

: 00:39:43

Very cool. Question number two, what fast food restaurant has the best french fries?

John Delia Jr.:

: 00:39:50

Wow. I've been boycotting the french fries, I hate to say.

Todd Miller:

: 00:39:54

Well, I understand that.

John Delia Jr.:

: 00:39:55

Oh, my gosh. Oh, I got it. Five Guys, Five Guys.

Todd Miller:

: 00:40:00

That's good. Those are good. Good answer.

Seth Heckaman:

: 00:40:03

Question number three. What would you like to be remembered for?

John Delia Jr.:

: 00:40:09

Impact. In 2065, I want to look back in a room with friends, family, fanatics, etc. and I want to say I touched the lives of tens of thousands of people through my work and through impact.

Todd Miller:

: 00:40:20

All good stuff. No, no doubt you're well on your way to that, so that's great. Next question. What is a favorite childhood memory that just pops in your mind?

John Delia Jr.:

: 00:40:31

I got lost at Disney World.

Seth Heckaman:

: 00:40:33

Oh.

John Delia Jr.:

: 00:40:34

I was found, obviously. And I got distracted looking around. And I still remember it. And I got lost to Disney World, my first trip to Disney World.

Todd Miller:

: 00:40:45

Sounds a little bit frightening actually.

Seth Heckaman:

: 00:40:50

Next question. What is on your cell phone wallpaper?

John Delia Jr.:

: 00:40:53

My son, I have a seven-month-old newborn, Baron. He's so cute. At least I think he's cute, so he got to take over the wallpaper.

Seth Heckaman:

: 00:41:02

Congratulations.

Todd Miller:

: 00:41:03

Very cool. Next to last question, if you had to be a dog or a cat, which would you choose to be?

John Delia Jr.:

: 00:41:12

I'd be a dog. I'd be a puppy, probably a goldendoodle. I'd be a puppy.

Todd Miller:

: 00:41:16

Gosh, you even know the breed.

John Delia Jr.:

: 00:41:19

I think about this a lot.

Seth Heckaman:

: 00:41:24

Alright, last question. If you were a professional athlete, what sport would you play?

John Delia Jr.:

: 00:41:30

Business.

Seth Heckaman:

: 00:41:32

There you go.

Todd Miller:

: 00:41:33

I like that.

John Delia Jr.:

: 00:41:34

Yeah, but probably gymnastics or hockey. Hockey's another one where they're tough, they skate, they fight, they, you know. So one of those two.

Todd Miller:

: 00:41:46

I had someone suggest that the only thing I might have hope on would be in curling, the guy that sweeps the little broom or something. But I don't think I could even do that. This has been great. So for our audience, I don't know if you picked up on our challenge words or not, but we were all successful, which was very cool. Seth, you had the word?

Seth Heckaman:

: 00:42:09

Cattywampus.

Todd Miller:

: 00:42:11

And I had the word pedagogy. And we're debating whether it's pedagogy or pedagogy. But John gave me that word I got to work in. And John, your word was?

John Delia Jr.:

: 00:42:25

Poinsettia.

Todd Miller:

: 00:42:25

Nice job working it in. I kept thinking, as you're talking about rehabbing old buildings, you say we open up the walls, we found this ancient poinsettia there or something. This has been great. What a pleasure, thank you. For folks who may want to get in touch with you, how can they most easily do that?

John Delia Jr.:

: 00:42:46

You can find me on LinkedIn. I love hanging out there. John Delia Jr on LinkedIn or visit our website at housingjointventure.com.

John Delia Jr.:

: 00:42:53

Todd Miller: Very good. Well, thank you, this has been a great episode and I will thank our audience for tuning into this episode of Construction Disruption with John Delia Jr. of Housing Joint Venture and Green Monkey Builders. Please watch for future episodes of our podcast. We always have great guests here that we are blessed with. Don't forget to leave a review on Apple Podcasts or YouTube. Until the next episode though, change the world for someone, make them smile, encourage them. Powerful things we can all do to change the world one interaction at a time. God bless and take care. This is Isaiah Industries signing off until the next episode of Construction Disruption.

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