How do you achieve a 12-18% cash-on-cash return with Furnished Finder? Mark Reed, founder of SURE Property Management, Development & Construction shares how he built a thriving Furnished Finder portfolio in Baltimore, MD, by revitalizing a neighborhood hosting medical professionals. Learn how I built a cashflow machine with travel nurses & Furnished Finder in this episode of Landlord Diaries. Discover how to maximize profits with this unique rental strategy!
In this episode, Mark reveals:
Why medical districts are goldmines for mid-term rentals
How travel nurses can stay 90-180+ days, achieving nearly 100% occupancy
The 3 biggest advantages: Furnished Finder, MTR cash flow & medical travelers
How Mark revitalized a community while scaling his rental business
Episode Highlights:
0:00 Welcome to The Landlord Diaries
1:25 From Airbnb to Mid-Term Rentals (MTR)
3:00 Discovering Furnished Finder & Making the MTR Shift
4:50 Scaling in One Market: Unit Sizes & Strategy
8:40 🏚️ Medical Micro Communities: Two young women found safe housing while 13 homes on the block were boarded up!
9:30 Choosing the Best Location for Your Monthly Furnished Rental
12:15 Designing Your Rentals for Travel Nurses & Corporate Guests
18:40 The 3 Major MTR Advantages: Cash Flow, Furnished Finder & Medical Travelers
19:05 💰 The Cash Flow Advantage: 12-18% Cash-on-Cash Return
22:10 🏥 The Medical Advantage: 90-180 Day Stays = Fewer Turnovers
23:10 🏡 The Furnished Finder Advantage: Direct Booking & Personalized Stays
26:45 MTR Hosting Strategies: 5⭐ Guest Experience = Renewals & Referrals
31:00 Revitalizing Communities with Mid-Term Rentals
Episode 135 Transcript
12% cash on cash return will be with a two bedroom. Typically with a three bedroom, we have a cash on cash of about 14 to 15%, and when we do have three bedroom and basement units and with those, we can even get up to 17, 18%. Welcome to The Landlord Diaries, where we talk about midterm rentals and the opportunities behind them.
We'll share landlord stories, talk about maximizing investment potential, and discuss how to live the very best landlord life. This podcast is proudly brought to you by Furnished Finder, the leader and largest online marketplace for midterm rentals. Remember to like and subscribe if you enjoy our content.
Mark Reed is founder and president of Sure Property Management Development and Construction, specializing in midterm rentals with 13 of his properties listed on Furnished Finder and a keen focus on housing, traveling medical professionals. Mark has built a thriving MTR portfolio in Baltimore, Maryland.
Today we will discuss how Mark achieves a 12% cash on cash return. Why proximity to medical districts is a game changer, and how his unique MTR model is shaping the future of furnished rentals. Mark, we have such a fun conversation today. How are you? I'm doing great. Thank you so much, Kelly and Katie. I'm really happy to be here.
Yes, sir. We always like to start with your real estate story. So while a majority of your MTRs are within a couple blocks of each other in Baltimore, Maryland, your first midterm rental was a house hack at your primary converting half of a duplex to midterm rental. Tell us what led you to MTR.
Yes. So basically what happened is I was living in Chicago on a work assignment. And had a furnished apartment in Chicago. And after the work assignment ended, I was coming back to dc, my primary residence, and I was a traditional landlord and the tenant, I had a duplex or a two unit, depending on what part of the country you're in.
And I thought to myself. I'm gonna bring this furniture that I had in Chicago and furnish my lower unit. And I just thought I would do like a traditional rental, long-term rental on it. And a friend of mine said, have you considered Airbnb? And I'm like, no, I haven't. I don't even really know anything about like that model.
And I tried it and it was wildly successful. I was booked the first day I put on there. And Airbnb reached out to me and said, Hey, we wanna make your property a feature property. They sent someone out, they took pictures of it and they did all kind of stuff and it just went bananas. And so it was a really good first experience right up until Covid.
But that's the first taste of short term rental and and what led me on a path to even midterm rental. And that's why we're here today. Yep. And with that path to midterm rental tell us more about Covid, because it was when you recognized that a lot of your bookings were just getting canceled and you wanted more control.
So what led you to Furnished Finder and midterm rentals from that first experience with short-term rentals? That's exactly what led me to Furnished Finder. It was, I just felt airbnb just did not respect their hosts whatsoever. People were saying, Hey, we'll rebook, we'll do this. We still have to come to the city.
I was in Washington, DC so that's obviously the epicenter of all things government, so people still wanted to travel, but Airbnb unilaterally canceled everything, didn't even let us really communicate with guests. And it was really frustrating. And when I just thought about the platform and what that could.
I've started looking for other things and that's actually when I found Furnished Finder and started my journey with Furnished Finder over five years ago now. I love that there's so much control that you gain back when you get to do midterm rentals. I've toyed with short-term rentals in between midterm rental bookings just to help keep a consistent calendar.
I don't do it very often, but every once in a while I'll have an awkward gap and I'll be like I'll try short-term rentals here. And it is, it's, there's just, there's such. Lack of transparency, and it's so restrictive with the communication. And then you get these cancellations that are last minute, but if you don't allow last minute cancellations, you get penalized.
It's just, it feels very restrictive. And the midterm rental field is just, it's so much that you get to do it how it works for you and your business and your properties, that it just feels like you get to take the reins back. Katie's favorite question I'm gonna steal today, which is the portfolio talk.
She loves talking about your midterm rental portfolio, and you have quite an impressive portfolio, Mark. You've got around 12 to 13 midterm rentals on Furnished Finder. Majority of them are two bedrooms with either two bath or one bath. And then you've got a couple, one bedroom, one bath, and then you've got a couple, three bedroom, two baths in a.
As we said, a majority of your portfolio is in Baltimore, but your original is still on Furnished Finder as well in Washington dc and your prices range from 1400 to 7,500 monthly for your rental rates, but majority fall between 2000 to 3000 monthly. So what led you to Baltimore and how did you select your first group of midterm rentals?
I am gonna try to keep this brief. I appreciate the question. What led me to Baltimore was a beautiful woman that I met who lived in Baltimore, and she told me that the Baltimore market was very affordable. I. And I knew nothing about Baltimore. Literally the only thing I had known about Baltimore was going to the inner Harbor, going to an Oreos game and like a work function or something like that, and leaving.
Spent zero time there. I went to an auction. I bought four properties. These properties were one mile from Johns Hopkins Hospital. And so I love the proximity and I wish I could tell you that I studied. And was able to pinpoint this exact location, but I didn't. It was simply divine intervention. I did not know where the, this path was taking me.
What I did know as an investor was the fact that the houses were like $13,000 and they claimed that they had a lease on 'em, and the renters were paying $500 a month. You do the math on that, and basically in two years, the house is paid for. So it seemed perfect. But that wasn't actually true. They people really weren't paying rent and it really wasn't inha.
It wasn't habitable. So that didn't work. But the hospital feature, once I got in there and understood the proximity to the hospital, I knew it was something special going on here in Baltimore. And that's where I started this whole journey. What it was it now, eight years ago now. Yeah. And I think now what have you learned since then about your, you started with four that you bought at auction, but now you own 13 of 16 on that block and you're building them and rehabbing them for midterm rentals.
So what have you learned in retrospect now that you didn't know going into it? We don't have time to go into everything that I've learned. We simply don't. But I think the one thing that I was trying to do was really build community. Like the first block that I did, the 2100 block of East Chase and Baltimore, there were 18 homes on the block.
I'm sorry, 17 homes on the block. I own 13 of them. So I built them I started with doing two side by side. Then I bought, and then I expanded to do the whole block over a two year period. The lessons are, whether it's from dealing with, in that early portion, I wasn't a contractor, so I was dealing with contractors.
So how to deal with contractors how to deal with. Companies to try to get the best pricing that's possible. How to list the properties even and interact with folks that are coming to a street now that is not completely built. Katie, when I first got there and I did my first two, I was renting it and.
A block where 13 of the other houses were literally boarded up. And I know it sounds crazy, but I had guests that didn't have a problem. They stayed there. I actually had two young ladies from Texas, or my first guest, and when they first got there, they were like, is everything gonna be okay? I was like, yeah, me and my guys are gonna be every day.
We're building and you've got, a ring camera and you've got a storm door, you'll be fine. And they were a little apprehensive. They stayed, and not only did they stay, one of them left and that the other one stayed by herself. For another four months on a street. Wow. That basically had three homes in it.
I'm grateful to God that this thing worked out, and as I started to build community, more people would come. And again, we're in the midst of Covid too. So Covid really helped me. Literally. You can walk to Johns Hopkins Hospital, obviously major world-class medical center, but also they have an employee shuttle.
The shuttle will pick you up right at your door. So the convenience was unmatched and even though I didn't know what I was doing initially, when I got into it and understood the value prop that I was giving to these nurses, it just took off from there, I think. I think that's huge because we hear so much about, how do you know?
From investors or landlords or people who are trying to get their first property or their next property. How do I know if this area will be good or how do I know if this street will be good or this house right from metro markets? How do I know if the Dallas area will be good or how do I know if this specific area in San Diego will be good?
And I think what's key is it's the service you provide, right? Mark is saying, and it's the home that you make because he's serving these travel nurses, right? And. They're coming in to serve the community. So what kind of home can you provide for them? And then what is the need for that home with a hospital center like Johns Hopkins?
Johns Hopkins, right there, obviously there is that demand. There's a huge demand. So you literally built. A micro community for these medical workers. So I think it's always, I always encourage landlords and investors to look closer, right? Don't just look at the stats and don't just look at the metrics, but look really what is missing in that area?
Is there a need for more housing for medical professionals? Is there a need for housing for grad students or interns? Or is it relocating families? Is it military? What is the need that you can see? Serve. And then you go in and you fill it. And that's what midterm rentals do, right? I can say I need a vacation and I need to go to a beach house, but at the end of the day, I truly don't.
But if I'm a travel medical professional, I need a house or a place to live and call home that is close to the center that I'm working at. So I just love how you truly found that alignment, even if it was. Afterwards, right? Even after you got in and you were like, I have these properties. What do I do with them?
Sometimes it just takes looking at things with that frame of mind and saying, okay, I have these, what do I do? Who do I serve? What problem do I help here? I agree one 100%. If I could add onto even what you said, Katie, just about the nurses, and one of the things when I was designing my homes, I absolutely knew where I was and when I was dealing with my architect, there's a.
So 70% of Baltimore has row homes. So these homes are connected by a party wall, a partition wall, a common wall, if you will, but of course they're completely separate homes. But anyway, what I wanted to do was put an en suite in each bathroom. A half bath in on the main floor, and my architect said You could just do one bath, one bathroom and let your guests share or let the family share.
And I said, absolutely not. I know it's gonna cost more and it's me building it, but I just had a vision that. 95% of nurses are women probably, it's probably higher than that. And from what I know, man, I'm a guy, I don't wanna share a bathroom. So if you're thinking about getting makeup and all your belongings and then every day you have to move that in and out.
So having, each of my nurses have a suite, if you will. They've got their own tv, they've got their own bathroom, they've got a desk, and all that is private, and the next room is private as well. So that if I were gonna have people living together that didn't know each other, they didn't have to share anything.
And then if you have a guest, they don't have to come upstairs to your living quarters or what have you. We made sure to make the living room very comfortable dining table and just try to make it so that. These nurses work 12 hour shifts. And one of the things about my background was I'm a corporate guy, 20 plus years.
I traveled 200 nights a year for many years. I know what it feels like to be home and you just want to basically be able to sit things down and be comfortable and it be well thought out. And I've worked diligently to do that. Today's episode is proudly sponsored by Furnished Finder, the ultimate platform for hassle-free midterm rentals.
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What was important to me was just envisioning the guests before we even developed, or even, basically broke ground on a property. So I had a strong feeling that people would be living in these homes that potentially didn't know each other. So the whole idea of having an individual suite was key to this.
So the idea was, again, that maybe there would be two nurses and it is not unusual for travel nurses to travel as a team. Every once in a while you'll get a couple that may be married or in some form of relationship and they travel and work together. And so the idea of everybody having their separate space was just something that I just could not get away from.
And. That's why I did it. Something else that I did recently was the idea that people may want just a room, and basically it's the same concept. It's just that say for instance. You're a student at Johns Hopkins Nursing School, which actually happens with us, and you need a room, then I will give you a room and rent you a room that has its own like electronic lock on it.
And you'll share the common area with your roommate. And again, I have a couple of homes where. They're both Hopkins Nursing school students. They do not know each other. Or did not know each other prior, excuse me. But again, one of 'em lives in one room. One of 'em lives in the other room.
They have locks on their doors. They have their own suites as it were. And then again, the common areas. They'll share the living room and the kitchen. And if you. Two or three years ago, I would be doing that. And I was like, no way. It's too complicated. There is no, it works so well. What I'm hearing from you is something that, that it's also another perspective, right?
Another frame of mind that I think it sounds like you've been very successful in doing, which is putting yourself in the shoes of your ideal traveler. We have so many different types of travelers. We have the travel nurses and medical professionals. We have the corporate travelers, like you said, you were one of, we have the dis. Placed families. It's really important as a landlord and an investor that you're not trying to accommodate all of those. I hear a lot about blackout cartons and fans and coffee machines and white noise makers and those are fantastic. If a traveling medical professional who might have a night shift.
Your audience, right? It's completely different if you have a family. It's completely different if you have a corporate worker, right? So I would just encourage everybody to not stop trying to appeal to every single type of tenant because there's so many travelers that are using these midterm rentals, but really think about.
Who you're going for and how you can assist them, right? If it's a displaced family and you're going more the insurance claim route or the relocation route do you wanna add some kids' toys into there? Do you need to have, an extra bathroom? What are the types of things you're thinking?
Because when you try to please everybody, you're gonna please no one. And I think by really stepping in and embracing the fact that you're like, Hey. I'm close to the hospitals, I'm close to these great medical facilities and these nurses are gonna want their own bathroom. They're gonna want their own space to, open up their laptop and maybe FaceTime with their families or whatever it is.
You're embracing those, and I think that's a huge part of your success in a lot of success that we see from landlords on Furnished Finder is really, dig in there and think about what would that traveler type really appreciate. I think that's a great segue, Katie, too. Three things we wanted to discuss as the midterm rental advantage in Mark's portfolio.
One of those is Furnished Finder. So we're gonna discuss three things. The Furnished Finder Advantage, the Cashflow Advantage, and the Medical Advantage, which we've already touched on. But wanna lean into a little bit more just as far as how long Mark's leases are, et cetera. So let's start with. The cash flow advantage.
What, how have you been able to accomplish a 12% cash on cash return?
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It's been not that difficult, and what I do is basically try to manage the properties as efficiently as I can. In other words, what we do is when we have longer term guests, we either have them pay utilities or else we have a utility cap in place. And so by doing that, you don't get fluctuations in pricing.
We have been blessed to have over a 95, 90 7% occupancy rate. It's just a function of, again, we're at the hospital, whether you are a nurse or whether you. Johns Hopkins Nursing School is literally across the street from Johns Hopkins Hospital. We get nurses that come in and do a one year with us, two years with us.
So again, that's a good funnel that way. And as a part of my business, of course, I'm a host, and I'm also a construction company, but I also sell investments to individuals that wanna get into a turnkey situation of investing. So as far as that 12% goes, we because we have these longer term leases, and because we know obviously what the income is gonna be, and then obviously the expenses we can control because.
There is either a guest in there and they're gonna be paying the utilities themselves or they're capped at a rate to where it won't exceed this amount. And then that, obviously when you get your income minus expenses, that falls down to your net operating income. And so that's how we're able to derive the percentages.
And we actually could do, can and will do higher. 12% cash on cash return will be worth a two bedroom. Typically with a three bedroom, we have a cash on cash of about 14 to 15%. And when we do have three bedroom and basement units and with those, we can even get up to 17, 18%, obviously there's more rooms there, there's more revenue coming in.
So because of the nature of that, your return's gonna be a little bit higher. And then the, I think for the medical advantage, you already summed it up really well. I think the parts that you have shared with me prior is because of it being close to five hospitals and, four universities and medical centers you've got, and honestly not because Katie and I have the same, you've got 95 to a hundred percent occupancy.
And Katie and I serve a variety of tenants and see around the same occupancy as well because midterm rentals as. Reminder, average 90 day stays, you only need four tenants a year on average. A lot of times in my experience and what Mark is sharing, you only need one or two per year.
If they're extending their contract or they're, doing a remodel, or they just love the area and decide to settle in a little bit more as a digital nomad, or buy a house in the area, et cetera. So with that medical advantage. Mark is seeing those longer stays almost a hundred percent occupancy rate.
And then the last piece of that advantage with the midterm rentals is the Furnished Finder advantage. So I think set 95% of your bookings come from Furnished Finder in Airbnb. How do you compare the Furnished Finder experience to other furnished rental platforms? Hands down, Furnished Finder is the best.
I love the one-on-one interaction with a guest. I love the, I consider myself actually to be a hotelier too. I consider all of my properties to be a miniature hotel, and I consider everyone that stays there to be a guest. I. And I think the reason why is because I've spent so much time in hotels and I understand hospitality.
I also do a little arbitrage and I deal with one of the major, probably the preeminent home hotel brand in Baltimore. I do some work with them, and so I. Feeling like you're a guest and taking care of people is extremely important that they feel welcome and they'll come to you and say, what is it that you need?
As Katie mentioned before, blackout curtain, isn't it for everybody. So I wanna do the best I can to tailor the visit to the guest within reason. Of course. I can't put in a hot tub for you. Sorry. I'd like to, but if we can do things to make you comfortable. We're gonna do it to the best of our ability.
And Furnished Finder just provides that. I, my issue with Airbnb is I just think, and I'm, since all sincerity, is that they're pro guest. They are not prohost. So if a guest says anything, you're guilty of it. And I like the idea of, Hey, let me talk directly to the guest. If we have something we need to work out, let's work it out together.
As opposed to just the guest is gonna say something bad and hold something over your head and now you're like a hostage. So I just love interacting with folks. It. Helps with repeat business. It also helps with referrals. All things that I'm focused on. I'm sure you've had a lot of, you have a lot of really great guests on here that are certainly much more experienced than I am in this space, but having direct access to a guest.
Is the golden ticket. It's exactly where you want to be and you wanna take advantage of those relationships and especially when you're in the world that I am. 'cause you could be working with somebody or going to school with somebody and say, Hey, I live on 2100 East Chase. I live on toy joint.
We got a bunch of places, we set up like these cafe lights and we make it real cozy on the block. Bernie Finder allows me to do that, and I can't do that on any other platform. I think that's really important too, because with furnish mine, you get so much control, right? So you get to take the time to say, what is my process gonna be like?
And if you have one property or you rent out one room in your house, it might be incredibly simple, right? My husband and I, we run our portfolio that my family has invested with. And as we've grown, we've had to also grow our processes and do exactly like you've said and say, Nope, this is what we do.
This is how we do it. But I didn't have to ask anybody's permission for that. We got to make that business decision because with using Furnished Finder, we truly get to set our own processes, our own procedures, our own standards. So I think that's just such an advantage of the platform and I love that you've been able to really utilize that as well.
Okay. So you've been such a success with these medical travelers, which is just they're like. The classic midterm rental tenant, right? Everybody thinks, oh, midterm rental tenant. Oh you're doing travel nurses and it usually, Kelly and I have to explain, it's not just travel nurses, you guys, but you really are honing in on them, which is fantastic.
I would love to hear any advice that you have for landlords or those interested in becoming a midterm rental landlord. How do you become successful when working with these traveling medical professionals? I think that one of the key things to do with that, Katie, is meet your guests where they are and try to take, try to help them in what it is they're trying to accomplish.
So again, whether you are a traveling medical professional or a. I got some guys working on the railroad that's just doing a renovation project. We check in with them. We do things that we call pop buys where it was Valentine's Day a few weeks ago and we brought candy and we put it in.
Everybody's at everybody's doorstep. We did, we do Christmas res, our wrapping for guests that want that. We just really work on things that are just, they're small touches. They don't a lot of money, but people when they know that you care and that they know that they're valued, it just has this effect of just.
They want to stay with you. They just become attracted to you. They tell others. Of course for me, I've got a built-in advantage. I'm literally, if you're on a, if you're in your bedroom in some of, in a majority of the homes I have, you could look out your back window and see Johns Hopkins Hospital.
So obviously that's a huge advantage that I have that. But I believe for hosts that don't have a. Hospital in your backyard, making sure your guests feel comfortable, understanding, asking them what is it that you can do for them, and just being attentive to their needs. Sometimes things aren't gonna work out, but hey, I'm gonna call somebody your heater.
Your furnace is leaking or not working, or whatever. Trying to be as responsive as you can. All those things I think lead to successful engagement with folks. Unfortunately, things. But as long as you acknowledge them and you try to get them handled as quickly as possible, I think that's all anybody can ask for.
All right. This has been so fantastic. It's so great to hear the story from literally getting these properties at auction and being surprised with their condition and how they were leased out. And just, you having, you take the opportunity and the chance to invest in them and invest in midterm rentals and see how you, in one way or another, stumbled upon midterm rentals, but you stuck there because it worked and, I get this big sense of fulfillment from you, that you are helping these nurses and these medical professionals as they come in to serve the area and the community, and I think that's. At the heart of a lot of this and the roots, and I just think it's so fantastic. So kudos to you for not only building, such a tangible portfolio that's growing and that you've literally created so much value within, but that you've also created homes for those who are coming in to serve the community and the needs.
And for being such a fantastic Furnished Finder landlord and learning all these lessons along the way. And thanks for coming on and sharing them with us. And I hope that everybody is able to take a couple things from Mark and put them into play and remember to find who your target tenant is and really step into that.
So Mark, I will give you the mic one last time and let us know where everybody can connect with you. If they wanna learn more, if they have further questions or if they just want to maybe say hi. Thank you again Katie. I appreciate the opportunity to be on this platform so much. It's, a treat to have able to do this with.
I know so many accomplished individuals and hosts that you've had on here before. So thank you for your time and what you're doing at Furnished Finder and how you're helping host to achieve our goals. I love doing this. I just want to say one thing as it relates to hosting is important, but being in Baltimore City, a place that's been disinvested in it for over 50 years, the homes that I have rebuilt have been vacant on average for 25 years.
So I literally rebuilt a block that just was desolate and I get a lot of fulfillment outta that. I get a lot of fulfillment outta our guests too. But that's one thing that even folks that invest in our community are like, Hey, we're really making a change. So even folks that are interested in investing it's a good opportunity to do well by doing good as they say.
Definitely a labor of love. I know that this was a direction that God had for my life. I didn't understand it. If he told me I was going to Baltimore, I would've been like, Hey, I'm from la. I can't do it. But here I am, eight years later. So it's really been a great journey and I'm very happy for it.
If you wanna get in contact with me, happy to talk to you. Thanks for being with us, Mark. It's been another great episode of The Landlord Diaries.