Jacob Davis

00:01

Jacob T Davis, here I’ve got my man Adam Jones on today’s podcast. Adam Jones, you are, tell us a little bit about yourself, self, Europe. You’re a Pullman. Pullman local,

 

Adam Jones

00:15

yeah, yeah. So I know Pullman local, but in some different ways, my grandparents came here in the 40s, built a house in the 50s. My dad grew up here. He was a Pullman greyhound. There’s some travel stuff. I actually grew up partially on the west side of the state, but then also grew up a lot here in Pullman. So, I’ve been able to be all over the place. But when it comes to remembering what downtown Pullman looks like, the old combine, and just all kinds of other elements, there’s, there’s a lot of deep knowledge here, lot of good history. I remember all the different owners of Cafe Morrow, the different things the Thomas hammer used to be, over the years, like it used to be a cyber cafe. If you remember, I don’t know if you were in town for that.

 

Jacob Davis

01:10

I don’t remember that. No, I don’t think about well, so you’re, I was just looking at your video, and it says you’re a marketing technologist. What does that mean?

 

Adam Jones

01:24

Yeah, yeah. So, a marketing technologist. I’m also the owner of Pullman marketing advertising agency that helps take care of people all across the nation. But where we’re uniquely gifted at is being able to pull the IT side into the marketing so much of digital marketing has to have a technical understanding of, how are things being routed. Is this setting up with the database correctly? Are the automations working? And so that’s where a marketing technologist is really able to make things on both sides work. Is the messaging working awesome? Does the data actually support it awesome and making that work for our customers?

 

Jacob Davis

02:05

Yeah, you’ve been helping me for a lot of years. We’ve kind of been working together. I helped you buy a home back in we were just talking about back in 2011 back in the day. I think you were one of my first Zillow leads in. I’m pretty sure you’re, like, maybe my first or second or somewhere. You’re my, one of my first clients. So, we’ve kind of known each other for a while. So, you’re, you’re, you do, like, you know, you guys are awesome. You helped me with video. You do, you know, Google advertising, social media stuff, other What else do you guys do?

 

Adam Jones

02:48

So that’s so that hits a lot of it that, and that gets down to the tactical side, right of we build the website, we do the social media, we make the video content that helps get out to people, but then also doing the Pay Per Click advertising so that we’re able to generate that traffic and get that return on investment. But then we also really do assist with the strategy portion of it. Of Is this the right audience? Is this the right messaging? How do we develop the brand and the visual identity for things to progress and move forward so we work with clients at the really high level of almost Business Consulting at the end of the day, like, how do we operate as a business and marketing and messaging? But then we get down to the real technical, tactical items and that implementation. So, we do our best to be pretty full service. We do some print. We’re not huge into print, just because, well, print is things break. Things die, it litters. Stuff happens. Getting stuff from the printing people is sometimes really tough. I’ve never met a printing office that has the same, uh, templates or the same scaling.

 

Jacob Davis

03:57

Did you know I actually was a press man back in high school. I worked for Cougar graphics. I ran, yeah, I ran a press back in the day. So, I did that for a couple years.

 

Adam Jones

04:12

Oh my gosh, I love it.

 

Jacob Davis

04:16

Well, cool. So, the reason you know, in the other thing that I think is awesome is you employ all, for the most part, all local people in Pullman, right?

 

Adam Jones

04:27

Yes, all local, all local. I do have a programmer in Brazil that I do like to use, but he is a WSU person, international student. Came up, met him, worked with him. So pretty much everyone I work with has that connection in Pullman, if not living here for extended periods of time,

 

Jacob Davis

04:46

awesome and, and so now you’re kind of, you know, you’re growing, and I’m helping you try to buy a building, and you know, that’s, that’s, that’s been, you know, in. Interesting experience, I’m sure, for yourself, and you’ve learned you probably know more about SBA loans than probably anybody at this point. So, what can you share about your experience going the SBA route for buying a commercial property?

 

Adam Jones

05:18

Yeah, yeah. So, and I’ll take a step back just briefly, though, because, like, I’ve bought and sold with you, I think four or five times now I’m trying to get that punch card, and for the most part, they’ve been pretty smooth. Like, there’s always, you know, a couple hiccups. Like there’s always a hiccup or, oh, hey, we need to redo the electrical box, right? Okay, it’s a federal electric cool. We get that’s normal. That’s, that’s normal house purchasing. I have, did a lot of research going into the commercial purchase, but I don’t, I think it’s something you kind of have to experience for yourself. All the other weird nuances of like, Oh, crap. I really do have to think through plowing. Wow. I really do need to think through the different insurances. What are there groups that don’t insure things? Are there people that are faster or better at this? What about parking? How do I do parking? What? And there really is just a lot more to think about than a house purchase going into the commercial realm, and so going the SBA route, it’s a lot more paperwork, a lot more paperwork, because you’re first off, you have to do the personal financial statements, but then you have to do the business financial statements, and then, if you don’t already, and I guess this is best practice, I didn’t know it. You also are to create a separate holdings account, which I’ve helped people do business licenses. I’ve worked with freelancers making a business license easy, trying to find the correct NAIC code for a real estate holdings company that also is not property management, but also is not this or that, that actually took a while. And so, then the experience so far has been, I’d say, fairly smooth, but there is just a lot more to the process. And Jacob, I didn’t know if there was a certain part of the process you wanted me to talk about most, or if you want me to just go through, walk through it,

 

Jacob Davis

07:21

because so, so let’s start with, why? Why go SBA route first? So, I mean, when you’re buying a commercial property, you could, you know, you’ve got SBA, you’ve got commercial cash, hard money. So why did you go, why did you choose to go SBA route?

 

Adam Jones

07:43

So, the nice thing with SBA is that it allows you to do a 10% down instead of a standard 20 or 25% Now, granted, you may be able to get better deals or better rates if you go up to say 30, 35% down on a purchase. But also, that’s a lot of cash, right? Like, regardless of what if, whether it’s 10% 20% 30% the moment you’re putting that much money down as a business, that can be a lot of your cash reserves, that can be some rainy-day funds, that can be for additional investments, or even just tax savings, right? Like, there’s a lot of reasons to keep a fair amount of cash on hand as you’re operating your business. So, I had looked at the SBA route and started in on it, just because, hey, 10% down that that keeps me pretty flush on other elements, just so that, hey, we’ve seen 2020 we’ve seen 2024 maybe I do want to keep a little bit more cash on hand.

 

Jacob Davis

08:47

Yeah, yeah. I mean, right now, it just feels like you just don’t know what’s going to happen. I mean, we’re in an election year, so you know, you don’t know who’s going to get elected. You don’t know what the direction the country will go depending on who gets elected, so it’s hard to make decisions. And so I’m sure you know, having as much cash on hand when you’re in business is, is a good thing. So, so, so you decided to go to SBA, you know, for the 10% down, otherwise you’re 25% down, right, typically 20 or 25% to go commercial route, and you’re working with Washington Trust Bank right on the on the loan and so typically with SBA, it takes longer Once You agree to get because you’re working with the government, you know, they’re slow, they’re slow at everything. So absolutely. So, talk about that kind of your experience. Like,

 

Adam Jones

09:56

yeah, yeah. Cuz, once again, to me, this is kind of like a good company. Person with, with normal real estate, right? Because most of my real estate deals have been, gosh, 30 days ish, you know, maybe, maybe 25 on one of the instances, right? Like we’re when you even if it’s a contingency sale on a residential Great, okay, the market has always been really hot. I you put a contingency offer in on house. You start your loan processing if you’re not pre-approved, and then you list your house for sale. You get it up, you sell it. Hey, 2535 days, and you can usually swing it with SBA. Your easy estimate is a minimum 45 days, if not closer to 60s, possibly 7080, days for that loan origination process, and part of that is just being able to do all the paperwork that the SBA asks of you up front, which it is three to five times more than what a Residential Purchase would be. But then they have additional items. So, for one of the properties we were looking at, they were wanting to see, okay, you have some industrial zoned nearby. Was there any dumping? Do we and trying to do additional environmental protection? That was a part of the SBA process. With that, they are doing their best as the government to ensure their purchase right? Like, it’s a loan, so they want to make sure that the asset is good. So, there were more environmental issue items that they wanted to come up with. There was more history items. There were some issues with the county that they were wanting to say, like, oh, is this exactly, right? What the county has on record? Well, there were renovations since the county records,

 

Jacob Davis

11:42

yeah, like oil tanks. You don’t, you gotta be, you know, make sure there’s no oil tanks when you’re, when you’re buying a property, because, yeah, because that has to be removed for SBA to move, move to do SBA loan you got, you can’t have exterior oil tanks

 

Adam Jones

12:00

Exactly, exactly, and so and so that’s part of the EPA, that’s part of the liability, that’s part of the insurance, that’s part of a lot of different assets that they’re looking at that as a residential purchase or even just a general commercial you might not be fully thinking about the other side of it too is that they’re actually really busy right now. What I’ve heard over the last two or three months as I’ve been working through the process, is that they are absolutely slammed, and that has been taking up way more time for those loan originations to occur and for them to actually even communicate and respond back to the bank through the liaisons and so that’s their thing. To keep in mind. It’s like with a bank or with a mortgage broker, either one, you know, you’re kind of able to do a one to one deal, or at least when we were doing the payroll Protection Program, right, the PvP banks were just inundated with paperwork, but they could have all the other branches really work into the process and supplement that manpower, where the SBA is not going to quick hire a bunch of people to work through a busy time. There it’s the government. They’re just going to do what they’re going to do for that extended period of time and delay it out.

 

Jacob Davis

13:23

Yeah, well, I mean, you know, but you just got to kind of plan it out, you know. And so, when you’re making the offer, we’ve got to have a, you know, get seller on board for 45 days sick, you know, two month close, typically. So, I think, and then, you know, I think you got to make sure on SBA you have a decent feasibility period to kind of work through any of the potential issues. And then, you know, Washington Trust, I think it’s been pretty, pretty great on, on the SBA side, they can only do what they can do because, you know, they’re working through the with the government, so I think they’ve done a really good job. And so any, any, I guess, when it comes to SBA, any other thoughts on that, recommendations on that, yeah, yeah.

 

Adam Jones

14:21

I think with anything with it, just keep in mind that while you are getting a 10% down payment, which is awesome, right? Like, it’s almost like in an FHA, one and a half percent down, those are awesome. It’s kind of like that. But, you know, there is a penalty to that in terms of a higher interest rate.

 

Jacob Davis

14:41

I was just going to say, what? So, what’s your interest rate going to be?

 

Adam Jones

14:46

We’re going back and forth. But the first interest rate that was floated was 11.25% which is tough when I’m like, oh my gosh, but I just heard the Feds cut all the rates. You know, I thought this was going to be a lot lower, but part of it is that penalty of the SBA guaranteeing the loan, so there is an additional higher interest rate that does get associated with that

 

Jacob Davis

15:13

right, and then refi, you’ve got prepayment penalties right, or something like that, where you can’t refi it.

 

Adam Jones

15:20

So, I just got clarification on that actually this week, is that if you’re able, if it’s longer than 15 years, so like if you do 14 and a half, you’re safe. But if it’s more than 15 years, there can be a 5% prepayment penalty, which, I mean, depending on the real estate you’re looking at that’s anywhere from a 10,000 to 50, $80,000 penalty within the first few years. If you try and refi it up front, or maybe, hey, this wasn’t the right building, you need to flip it and sell it. You’re going to be hit on that transaction, right?

 

Jacob Davis

15:57

And you, also your loan term is only for 20 years, right? You can’t amortize SBA 30 years. So that’s another big deal to correct you, sir, because your, your payments higher,

 

Adam Jones

16:08

correct

 

Jacob Davis

16:12

So, 20 years, higher interest rate, but lower down payment, yep. But you know, ultimately, then you own your building, you own your space, you know, and you’re not, you know, getting kicked out of a space you’re renting. So, you’re building equity. And because it’s a 20-year loan, you’re, you’re really kind of building equity faster than, you know, most people have a 30 year loan, so they’re, they’re making interest payments on most of their loan for the first, you know, portion of their loan.

 

Adam Jones

16:52

Well, cool. And to also, kind of, you know, even, even that, that statement out too, right? Like when you’re looking at renting places in Pullman, specifically, you know, we were, we saw places anywhere from 2500 to 5500 a month for a lease. Most of it tripled and, most of it, you’re having to pay for additional items. And so, when you’re looking at, okay, well, shoot, you know if, even if it’s 11% interest, and my payments are going to be anywhere between 20 550 500 you might as well be building equity with that 10% down, with an 11% interest, just in that you’re not allowing that money to go to waste through that leasing agreement, right?

 

Jacob Davis

17:41

Yeah. And, I mean, commercial real estate is fairly limited. It seems like for, you know, for what your usage is, you know, kind of nice office space is what you need, and there’s not a ton of options for that. There are options to rent, but it’s pretty expensive, and so if you can own it and kind of control that, then, then that’s awesome.

 

Adam Jones

18:10

Yeah, oh, yeah. And we, we looked at as an example, there was a kind of retail office space that was available off of bishop, and it was about 5000 a month minimum, start depending on, on shared plowing expenses up to 55 5700 in the winter.

 

Jacob Davis

18:31

Well, yeah, I was gonna say, then you have, like, cams, you know that you gotta pay. So, you have your bait, your rent, and then your cams. And it’s like, yeah, it’s commercial real estate. Office space can get super expensive. It was, you know, and on top of that is so like, you know, you’ve got people that don’t want to work in an office anymore, right? They want to work from home. Everyone wants to work from home. And so, then you’re like, you know, trying to think through that. Do I really need to buy commercial real estate? I think, you know, ultimately, it’s great exposure. It looks super professional when you know your client comes into your office and they’re like, oh, you know, you have an actual office. So, I think it’s worth owning a space. You know, just for the advertising, I think is a big reason to own, have your own office, like, for, for business, but it’s just super expensive. And you know, you’ve got to have a good agent, like, like this guy to host agent to help you find it. And you know, I do a lot of residential, but I do also do commercials. So well, cool. Any other thoughts I know, like, usually on my podcast, I talk about Cougar sports, because, you know, I’m I love Cougar sports. So, I mean, Hawaii game was great. Oh yeah, Hawaii. You know, my wife’s from Hawaii. We did a, we tried to do a luau tailgate for really, yeah, for the first time, my wife made some cool little pig, and we had some folks over.

 

Adam Jones

20:13

You. Did you do the House Divided, like, face paints with, like, part green, part red?

 

Jacob Davis

20:19

Well, she’s a, she’s an alum, so WSU alum, but she’s, you know, from Hawaii. So, yeah, we didn’t quite do that, but so as she was cheering for the Cougs, I think, for the most part. But, yeah, pretty exciting. Cougs are ranked. I saw in one poll, they’re ranked in the top 25 so I think that’s amazing, considering all the things that have happened in the last year. Yeah, I mean there, it’s just, it just feels like man Cougs are over performing. Or was, is that the right term, a little bit because that,

 

Adam Jones

21:01

oh gosh, who did they play? What was the group we lost to, badly, Boise State, yeah, which, okay. I mean, granted, Boise State is known as a good team, like that’s

 

Jacob Davis

21:12

they’re tough, but, I mean, they have probably one of the best running backs I’ve ever seen in college football. So, I mean, you got to give us a little bit of I mean that if that guy doesn’t get hurt, he will. I mean, he’s going to make a ton of money no matter what. But So otherwise, I mean, Cougs, I think Cougs are going to go undefeated for the rest of the rest of the season.

 

Adam Jones

21:40

And I think so. I think so, which, which? That being said, I don’t know that. I All of them are going to be slam dunks, like we had with Portland and the others, right? Like, I don’t know that they’re going to be that hard. But like, San Diego, Utah, New Mexico, I mean, they’re okay. They’re doing okay.

 

Jacob Davis

21:56

It’s Oregon State’s probably going to be our toughest, uh, game left? I imagine? Yeah. But you know, if we go and we need it,

 

Adam Jones

22:05

and we only need, I think, two more schools to be pack eight, which is what we need for the conference, which, as we do these more games, I do think it’s very easy for us to keep, keep our conference, keep the pack eight. I don’t know what it’s, something stuff looks like for basketball. That’s where I my knowledge goes, a little bit weak because, but you watch a lot more of the basketball too during the springtime, don’t you?

 

Jacob Davis

22:30

I got season tickets, so, yes, yes. Well, the other thing that you know, I haven’t talked to you much about Cougar collective or Cougs first, but I think that’s something you should get involved in. I’m actually going up to Spokane tomorrow for the Cougs first show in Spokane.

 

Adam Jones

22:54

So yeah, I am too. Do you want to carpool? Oh, you are gone, yeah. Oh yeah, you’ve got a booth. I don’t have a booth. I was just going to go to the thing.

 

Jacob Davis

23:03

Oh, well, I gotta go up early. I’m gonna be there at 12 for the lunch thing, so

 

Adam Jones

23:09

I’m probably gonna go. Okay, I reached out to Steve Heston, who’s one of the cool mortgage people in the area, so I might carpool with him then too. And I, we have been involved with Cougs first. I love Tony Poston and organization the way that he’s been developing it out just because alumni foundation is cool and all. I just don’t like getting hit up for money all the time, right?

 

Jacob Davis

23:37

Well, and yeah, I mean anything business related is always fun. So,

 

Adam Jones

23:44

oh yeah, that being said, are you doing a lot of Cougar collective? And I O stuff.

 

Jacob Davis

23:49

I am tip telling and so I’m a Cougs first Palouse posse member, and I went to a function up in Spokane last week on it. So, I am wanting to do more advertising with Cougar, you know, athletes and coaches and that kind of thing. So, we should collaborate a little more on that.

 

Adam Jones

24:15

Absolutely. Wait, what’s a posse member? Like? Is that a different membership tier policies like,

 

Jacob Davis

24:19

I think one of the you just pay more money to be part of the police posse. So, yes, I you do pay, you just pay more money.

 

Adam Jones

24:34

Okay, and what do you what do you get from it?

 

Jacob Davis

24:39

You’re just supporting and you know, you’re supporting the NIL, so the Cougar collective, so you’re, you’re giving them money, and then they can, then, you know, that allows them to have, you know, kind of a foundation of funds coming in, so they can, you know, keep coaches around, keep players around. Yeah, you know, I think I’d like to kind of do a deep dive into, you know, all the things that they do. But I think the main thing is they’re, you know, trying to help pay athletes so that they, you know, come to WSU and then stick around, yeah, yeah,

 

Adam Jones

25:23

absolutely, well, and I think there’s a whole experience sent end of that too, where, yeah, it’s not only just getting paid, but then, how easy is it to work with the business owners? Right? Like, cool, we might be as a student athlete. Like, I feel like they have to almost run their own business now, right, with, with their image and likeness and like, okay, well, what kind of business owners do I want to work with? Are these cool people to work with? Are they all kind of just jerks about stuff? Like, yeah, I think that’s where career collective and the others really actually do create a positive culture, making that connection point that I would be nervous if I was, like, at a California school. And like having to work with California business owners who tend to be a little bit more gruff or needy about stuff like,

 

Jacob Davis

26:07

Oh, I think, I mean, I think there’s a huge opportunity for business owners to get involved in that. I would imagine these, you know, these players, they’ve got agents, I get, you know? I mean, I think they’ve got agents, you know.

 

Adam Jones

26:23

And it’s like, some do, some don’t. It’s kind of wonky on that.

 

Jacob Davis

26:28

I’ve always been like, Man, I should just be a, an agent. That’d be kind of fun, but that would be but, you know? Yeah, so I think we should try to get some more players involved. I was so on my walk-through videos that I do, I I’ve been talking about for a while, I need to get one of our players to, like, you know, be a part of it and do something cool. You know what I mean, absolutely all right.

 

Adam Jones

26:57

So, you gotta find a house with a really good basketball court.

 

Jacob Davis

27:01

I need some I’m doing a video this Friday with, with Peter, your video guy, and trying to think it a good athlete we could get to be on it. So that’s my goal for this week. I’m going to try to get an athlete to be on that video.

 

Adam Jones

27:21

Okay, but are you, are you willing, like a football player, or are you okay with like a volleyball or like a golfer or baseball?

 

Jacob Davis

27:27

Dude I’ll take anybody. I’ll take Rowan. I’ll take, you know, curling. Do we have a curling team? I think just having an athlete on it would be cool. So, I do have a friend that said I should reach out to there’s a volleyball gal that he he’s a, he’s a principal on the west side, Kyle Axelson, but he said he’s got a a gal that I should contact to see if she, I think she’s on the COVID Volleyball team, volleyball or soccer. I have to double check that, but I should call her so maybe, maybe we can get, you know, one of these athletes on the next video. That’d be sweet.

 

Adam Jones

28:15

I love it. I love it. Yeah, you gotta save the rowing team for when there’s a good pool. Just put a kayak in the pool.

 

Jacob Davis

28:23

That’d be that’d be cool. I, I emailed the athletic director a month or two ago to see if she’d be on a video, but I haven’t heard back yet. So, I’ll keep, I’ll keep.

 

Adam Jones

28:38

You should reach out again. I got to listen to her present at a Pullman Kiwanis meeting. Absolutely delightful, very knowledgeable. I, I actually really feel very positive about the athletic director and the direction and the vision. I’m actually very encouraged about the current circumstances.

 

Jacob Davis

28:59

I mean, yeah, I don’t think anybody can complain with the way things went with the conference. I, you know, I went to a cougar collective meeting last week, and they talked about that, you know, how, like, you know, basically all these other schools just left, they just bailed on us. I mean, they kind of left us for dead. And, you know, then the President, I think he had the idea, well, let’s Sue I think, you know, it worked out, I think, and I think he had a right to sue him, like they just kind of totally screwed us, you know, so

 

Adam Jones

29:37

well, and they’re paying for it in some really different ways too, because I know that the, especially UW, has been really struggling with the travel schedule.

 

Jacob Davis

29:47

I was so I took screenshots of all the, the records, you know, of the big 12 and the Big 10 yesterday. I was just curious. And, yeah, everybody but Oregon is getting their, you know, they’re getting crap. Gosh, it’s like, I mean, USC and UCLA are the bottom of the barrel in the Big 10, you know, it’s like, try to tell you, you know, like, so,

 

Adam Jones

30:13

yeah, no, it’s tough. It’s tough. Well, especially, like, even trying to think academically, right? Like, you know, these are they’re athletes, they’re football players. They’re really trying to play and practice and give their all, but then they are still students, right? Like you’re still trying to pass organic chemistry, you’re still trying to pass your 400 level classes, which isn’t always the easiest, but then you have all day travel. You go and you get beat up by these guys, who are a lot of times they’re just bigger, like, they’re just the other teams. They’re just big guys on the other side of the line, and so they’re getting physically exhausted out of and then trying to go pass, get pass an exam on Monday and Tuesday. Like, that’s rough. That’s really rough. And I think it’s actually a disservice to the students at the students at the end of the day,

 

Jacob Davis

31:03

yeah, a lot of these guys, I mean, I grew up in sec country, so these guys are, have faced a lot more competition growing up than a lot of the players on the West Coast. You know, is my opinion, like, there’s just, there’s a lot, there’s a ton of competition down south So, and, and on the East Coast and, and I just think, you know, they’ve grown up playing a lot more tough competition. So now these PAC 12 schools are, are facing that, and it’s and not only that, tougher competition, but you’ve got really loud stadiums, you know, where, yeah, people are crazy, you know, and, you know. And so, it’s a new experience, but I think it’s, it’s probably good for these schools too, because they’re like, oh, okay, this is, this is how the rest of the country plays football. So, yeah,

 

Adam Jones

32:01

yeah, that’s true too, and in the long run, that actually might provide more opportunities for professional drafts and stuff too. So we’ll see, we’ll see how it plays,

 

Jacob Davis

32:11

yeah, so it’ll be interesting. I’m watching so well, cool. So, anything else, I think we covered quite a bit. It was interesting to hear your perspective on SBA. So hopefully we get, get a deal in contract today.

 

Adam Jones

32:29

Absolutely, I think so. I hope so. That’s why we signed paperwork, right?

 

Jacob Davis

32:36

That’s, yeah, we’re we should be in contract. So awesome. Well, Adam Jones, Pullman marketing local. Pullman marketing technologist, thanks for joining on my podcast, and I’m sure we’ll be chatting soon. Have a good day. Go Cougs.