Original subtitles

[Drew] Last time on Backed by the Bros...

-Nice to meet you. Drew. -I'm John.

[Jonathan]John bought this $1.35 million property in cash.

We want to back you.

Oh, my God. This is like a dream come true.

[Drew]I see a little bit of us

back when we were 21 years old in him.

How much would you spend to fix it up?

150 grand. So I'm all in 1.5 million.

That's a lot just to make it inhabitable.

He doesn't know his whole scope of work.

This looks brand-new.

[John] That was mistakenly placed there.

-We're gonna get rid of this. -What?

This is several thousand dollars of concrete work.

This is not a home-run investment property.

[John] If this renovation goes wrong,

I stand to lose everything that I have.

[Jonathan] I am putting it out there as a warning,

I think he's the type of person

who's gonna throw extra things on and try and overspend.

[Lee laughs]

-How you doing? -[John] There he is.

-This is your spot. You never leave the kitchen. -How's it goin'?

-[Jonathan] Hey, good to see you. -[John] Nice to meet you.

[Drew] So, we dug into the numbers.

We wanted to make sure we were comfortable backing you.

We know you were hoping to come in around $400,000 for your budget.

It's gonna be closer to $480,000

to renovate the main house plus the garage flex space

to make this a viable luxury short-term rental.

-Okay. -On our end,

We can offer you project management from Orr here

and design support from Lee for a total of 16 weeks.

I'm telling you this right now,

the challenge will be keeping you on budget

if you want to actually profit from this reno.

-Okay. Incredible. -Does that make sense?

I wanted to ask about the front door.

What if we extended a deck across

and moved the front entrance to the far side?

My end goal is

can we open up the entire back side of the house

so that we have as much glass as possible?

I think that makes sense to do.

I want four bedrooms on the ground floor

and then three up top.

And that would allow space for a large living room,

dining, kitchen.

[Jonathan] Yes. But here's a better idea.

If we were going to do some kind of a bump-out on the back,

if we bumped that out here,

and then imagine all of this being glass

across the backside here,

you get all of the bedrooms that you need on this level.

My concern is if you're still gunning to add a second story,

well, then what happens to all the work

that we're doing now on the main floor?

-[John] Mm-hmm. -I think the numbers work

without having to add the second story.

[Drew] Adding new footings and structure can be extremely expensive.

Our plan is you would just have the single story

with the garage converted.

You wouldn't have the second level.

You don't have to go up.

You're making enough money here,

and you can leverage this property

to get into other properties.

Make that money off of other properties

that have more potential.

If we're not doing work now to improve this,

um, I'm willing to spend the extra money up front

on all the infrastructure we need

to support that second story in the future

and remove and destroy some of the stuff that we built

a couple years down the line.

I understand what you're saying.

I don't think you hear what I'm saying.

I'm saying we do some work to improve this right now.

Turn this into a two-bedroom, two-bath within here

because that's going to give you far better rent

than what you could possibly--

Right now, you're gonna maybe get 4,500 bucks.

-Yeah. -What we're talking about doing

is going to get you over $10,000 in here.

Plus what we're talking about over here,

you're gonna be getting about $15,000.

Remember, this is prime Venice by the beach,

and you can attract higher-end renters here.

Sure, a second story could be great,

but that'll just add time and cost to your project.

Yeah, it's not as clear-cut and, like,

"Oh, let's just build a second story."

That also is gonna take a lot of time

and ripping apart a lot of things

that you've already completed.

Can we all agree

that if we can bump out, we should do that?

[all agreeing]

[Drew] That alone allows us to start to draw floor plans.

[Lee] Yeah. That bump-out gives you more flexibility.

We could turn this into a gorgeous suite.

Another bathroom in here.

[John]I'd like it to double as both

a living and entertainment area

as well as a flex space.

[Lee] You can have a small refrigerator.

It elevates entertaining for sure.

-[Drew] Yeah. -[John] You guys really think

that's something that will add more value?

[Lee] I think it would.

If we're not doing the second story addition,

right now, the only way to get you to that sweet spot

where you're maximizing your return

is to do a two-bedroom two-bathroom main house reno,

extra flex space in the garage

and a beautiful outdoor space.

[Drew] Your money would be better spent.

The value added, you could get into a whole other property.

And at the end, you're going to net out

better than you would with this house and a second story.

That make sense. Yeah.

You've already wasted $150,000.

Let's not waste another penny, right?

-Okay. -[Jonathan] If you want to add value in this space,

I think it's about creating zones.

-Yeah, I agree. -We could create an outdoor dining space.

I like the idea of doing, you know,

a water feature, a hot tub back in that corner

because you can make it a little more private.

[Jonathan] I like that idea of the water and the hot tub.

[Drew] 'Cause a lounging area,

that's going to get you a premium for rent, right?

[John] Mmm-hmm. Absolutely. I think you guys have a great plan.

And I think you guys see the vision.

[Drew] We are here to back you, to support you,

but you are the leader of this project.

-But this is gonna be great. -This is gonna be good.

Congrats on the property.

-Thank you so much. -[Lee] Thank you so much.

Bye, guys.

[Jonathan] All right. See you later.

[John] Today is a huge day.

Today is the first day of this project.

I've just been super-excited to take a big step

towards making my dream investment.

I'm digging into the home myself

and doing some demo on the wall.

You know, it was a little bit bittersweet

to see all of my...

what I thought was, you know, amazing

just get messed up.

But it's a first step towards a blank slate.

And it's going to make things better.

[Drew] This is one of the more ambitious projects that we've ever backed,

and it is going to take longer than most.

It's been two weeks just to get the demo finished for both buildings,

as well as dig the trench for the footings for the addition.

The addition will add square footage to the main house,

which means John can charge more rent.

[John] Oh, my goodness, you guys are hard at work.

So, basically, this is all of your addition.

This is what we're excavating for.

[John] Okay. It all looks great.

But I do have some concerns with the project.

-Okay? -What would we need to do

to set things up so that I can add a second story

if I wanted to down the line?

"To set up for a second story."

Is that something you've run by the brothers?

The last time we talked about it,

they advised against it.

No, it's not. But I'd like to, you know,

build whatever infrastructure we need to do now

to have that option open for the future.

I think they'd understand the bump in revenue is so high

that there's a huge ROI on it.

I mean, look, the conversation

that you're going to have to have with them

is timeline and then budget, right?

Because we didn't we didn't account for this.

So, um, I mean,

that's going to take different foundation work.

Because, as of right now what we have approved,

is for just the one-story addition.

If you did want to build a second story,

we'd have to go through planning with an engineer.

-Mmm-hmm. -Make sure that we bolster everything up

a little bit more.

-Mmm-hmm. -Um...

He's probably gonna require

steel incorporated into the framing.

And then steel posts and whatever

in order to hold the second story up.

I would probably say we're in the ballpark range

of like $30,000.

Yeah, I mean, I'll come up with the money.

I'll-- I'll dig into my savings.

And how would that affect our timeline?

That's another thing to take into consideration, right?

I would say probably around three weeks

of added timeline to this project.

I mean, are you okay with waiting

that amount of time?

I am. I mean, you know, I want to own this home for decades.

So a few weeks isn't gonna matter much.

-Okay. -Let's just try to, you know, iron out the details

-and see how it all works out. -You got it.

[John] At the end of the day,

regardless of what the brothers tell me

for setting this house up to add a second story,

it's something I want to do. So I'm gonna go for it.

[John] We've been digging out here,

getting things ready for the addition.

Great, great, great.

I like this. This looks good.

You guys must be ready to form and inspect them for--

What the heck is going on in here?

Holy smokes!

Did you guys come across a problem or something?

-Or what's-- what's... -[John] New details.

Oh, no. No, you didn't. Did you?

I want to put a second story on it.

[groans] Ah, I thought we talked about that.

What was the hit on this?

[Orr] I had estimated 30 grand,

but this ended up costing us 40 grand.

[John] I mean, it's a small lot,

so if I want to add more capacity,

the only way to go is up.

In Venice, the price per foot is so high

that adding another 800 or so square feet on top,

even if it doesn't bump the rent that much,

it adds a tremendous amount of value

in terms of equity.

If you're committing to this,

does that mean in the finished space down here,

are you going to get some rental income on it

over the period of time while you're waiting for the...

Yeah, exactly. I'll probably run it for a year or two

while I wait for the permit approval.

What's going through your mind?

This probably added, like,

I would say three weeks to a month.

Oh, my gosh. Okay.

I mean, to think that we're just gonna remove a wall,

and then you're going to, you know,

add the second story...

is-- it's much tougher than that.

I mean, look at the damage we've done just in doing this.

You'll have your footings, your foundation,

your framing ready,

but you're still gonna have to open up a lot.

You're almost gonna have to redo your whole first floor.

[Jonathan] He's spending a lot of money for footings

that are sitting there doing nothing

for a couple of years,

while he gets permits for a second story.

How much more is that gonna get you for rental income?

Zero.

Is there anything else that has been added

other than this? Or is this...

[John] On the north side wall, we want to put a slider

and then put like a waterfall behind it,

so that we can have some, you know, running water--

-[laughs] What are you talking about? -...for people to listen to.

-A waterfall? -Yeah. I want to make it Zen.

-You gotta show me this. -I'll show you.

I have know idea what you're talking about.

So this is where we're talking kitchen, open area,

entertaining space.

You're saying here on this wall?

[John] Yeah. I want to put a slider here and just, you know,

drop a nice Zen waterfall right behind it.

A slider with a Zen waterfall.

This is-- I was not expecting that.

-[laughs] -I mean, the way I'm thinking about this

is that, you know, it's a short-term rental,

and so the most important thing is, you know,

stopping the scroll

when people are looking through websites

to book something.

So I want something that really, really catches people's eye.

I think the waterfall is well worth

5 grand or 10 grand, or whatever it is.

Oof.

Hey, or-- you know what you should do

is before you go spending a ton of money,

let's wait and see if anything else comes up

as we get these footings poured and we start to frame out

just so we can figure out

do we need to save?

The real focus is gonna be looking back this way.

Yeah. I know we were originally thinking about

likely doing bifolds out to the backyard.

But I'm thinking that sliders are probably a better option.

It just lets you see a lot more of it.

Because part of the big sell is going to be

all the cool stuff that's in the backyard.

Have you priced it yet?

It's going to be more. But...

If you're spending and spending and spending now,

I'm already warning you,

you're going to hit a point where you're like,

"Oh, no. I overspent early on."

You always need to be looking

for little opportunities to save money.

That's the only way to maintain a healthy return.

Let's get Lee back in the conversation,

because I feel like she might have some input.

I feel that John is a bit of a loose cannon

because it'll just be in one ear, out the other,

and he'll keep doing what he's doing.

Hopefully, he'll take a little bit of our advice

and save himself some headache.

Another change order.

And even new costs are being added on to this.

[Jonathan] Every new change order that comes in

makes me question more and more

did we back the right investor?

You didn't tell me about Mr. Moneybags.

I'm like this. Reel it in.

Anyway. Okay. I want to know about this space.

Has anything been added or changed? What's the plan?

Yeah, we're trying to make it, you know,

as livable as possible.

You still want to have doors that open up?

Yeah. We want to do a big slider here

and then probably a main door on the side.

I want it to be more visible, you know,

when you're looking out.

Um, and then I also just want to keep the theme going of sliders

that we're doing in the primary home as well.

Right. So what's the plan for the ceiling height?

Because right now, with a little bit more work,

you could take it all the way up to that height

and keep it at that height.

Is there any way to potentially like flatten it, you think?

So we could put like a little second rooftop deck

up there, or something.

-Oh, my God. -[all laughing]

Are you effing with me?

Maybe down the road it is.

Stop spending on things that you're just gonna have to rip back out.

He's got these lofty ideas.

I like this guy,

but I want to strangle this guy.

Right now, when everything is open,

this is the time to do the things

that we know we're going to do.

[John] My goal with this is to make it like

the best stay in Venice.

So I feel like, you know, there's no way I lose money

making the best product.

[Jonathan] Ay, ay, ay.

Just make a decision on a lot of this stuff

so we can move in a direction.

And, like, for the love of all... [laughs]

Let's not plan on putting anything in

that we're gonna rip back out.

-It's a waste of your money. -Yeah.

All right. I'll see you guys later.

[John] Thank you, Jonathan.

I'm gonna see if I can get a couple vendors that can help, at least,

-with like the sliding doors and stuff like that. -Yeah.

But, uh, like, I'm starting to actually have second thoughts

about whether or not we should have backed this project.

-But... Anyway, you're my eyes and ears. -Okay. You got it.

All of my fears have been realized.

We all looked at the same plans.

We approved it. John approved it.

And now he's changing it.

I've never seen this before.

John is just spending.

The end goal is not to just do something

that creates an incredible experience, and that's that.

The end goal is to build a business.

I mean, you know what?

It might be one of those tough love things

where he's gonna learn the hard way,

because he just doesn't listen.

Are we able to have a large glass slider

in place of a garage door on this side of the garage?

[Orr] So another change?

John is aware and unaware of our timeline.

Like, he's aware, but he kind of doesn't care.

The glass garage door is gonna come on time...

I hope.

I see him as more of you when you were younger

than he is of me when I was younger,

-because you were-- -Because I was good at faking it before I make it?

You would fake it till you make it,

but you were also a little more ego-driven.

I want him to succeed,

but, I mean, he's got a lot of learning to do

if this is going to actually become a good investment.

[John] I need the brothers

because they have the potential

to add a ton of value to this project

and save me a ton of time, a ton of resources,

and to set a really positive trajectory for this project.

[Orr] Hey, John, how you doing?

It looks like you blew up half my house.

Yeah, right? Took off half of it.

[John] Although we have maybe different mentalities

on how much to spend on certain things,

I have a very clear vision

of making a really incredible experience for guests.

And so, I need to push back on their feedback

and move forward with the things that I think are important.

[Lee] I have some stuff over here to look at.

-[John] Let's do it. -For the kitchen cabinets,

these are just like some white oak samples that I had.

We can go darker if you want.

But like this is almost like a white oak or birch.

[John] Okay.

So this is an option for the flooring.

-[John] Mmm-hmm. -And this is a LVP product.

It's waterproof.

It's really good for rentals.

Um, you know, durability. Excellent.

I really like this one.

Yeah, it's really good.

And then these are--

I just wanted to give you a variety.

But these are engineered flooring.

It's super-durable as well.

[John] Okay, I definitely like the lighter color.

Okay. So if we want to use LVP as our base,

then I would go a little bit darker on the cabinets.

And not go so...

You know, I wouldn't go so light.

-Mmm-hmm. -Because then you can really get the different levels.

[John] Okay.

The countertops, this is a new product that's coming out.

It's a printed surface.

But then there's a clear coat on top of this

that makes it waterproof, stain resistant,

and it does make it look like natural stone.

Amazing.

I'm not a big fan of the brown or the gold.

-Okay. -The lighter one right there in the top left...

[Lee] With the less veining.

[John] Yeah. I think that one just looks like the cleanest.

-Okay. -Um, I think that with this LVP flooring...

-Mmm-hmm? -...those are like some of the big items

-that I really like. -I got it.

[John] The one thing I'm definitely realizing is

design is this ongoing, fluid, ever-changing process.

And talking to Lee,

she definitely sees things that I don't

and brings a lot of super creative ideas to the table.

You know, I love that people are gonna be able to walk in through the front

and then, you know, see all the way down to the garage.

So, are we able to potentially do, you know,

kind of similar to how we have a slider

on that side of the garage?

Also have maybe like a large glass slider

in place of a garage door on this side of the garage.

That way, when you walk in,

you can see from the front of the home

all the way to the back of the property

and through the garage.

[Orr] So another change.

[Lee]John wants to do so much,

and he is aware and unaware of our timeline.

Like he's aware, but he kind of doesn't care.

So it's a recipe for disaster, really.

So, basically, it's gonna be framed

-a 16-foot opening? -Correct. Yes.

The thing with that is we'd have to now

get a custom-made sliding glass door that's 16 feet.

Mmm-hmm. I'd say maybe if it's under 12 to 15 grand,

it's worth doing, and I'd like to do it.

Yeah. I mean, for me,

it's adding more work.

You know, that's what's gonna push us back.

So it's gonna delay the project.

I know. We absolutely cannot push.

My team can't stay on longer than what we have allocated

for this project and timeline.

So if you're serious about this slider,

then we need to find someone to do it

within the next three weeks to stay on schedule.

If it's even a week later, we can't do it.

Let's flash back to the mid-'90s,

when we did our first project.

We were John. Like, we did exactly what he did.

We put so much money into that

that at the end of the day, we didn't make any money.

We overspent.

So I get where he's coming from.

He's going to learn by mistakes.

But hopefully we can save him

the most costly of those mistakes.

If we could go back and tell ourselves, "Warning.

Don't do this. You're overspending."

Would we have listened?

I don't know if we would have listened.

To be honest, I don't know.

[John] I'm really excited to put a big glass slider

instead of a traditional garage door.

I completely believe that spending a premium on certain things

is going to earn a return.

And I think that sliders are the obvious choice

to put in as doors in this home.

You know, when you walk in the front door,

you're gonna be able to look all the way

to the back of the property through the sliders.

And given how constrained we are with space,

I think anything we can do

to expand the feeling of largeness and openness

is something that's worth pursuing.

[Jonathan] This job was supposed to take 16 weeks.

Based on what I'm hearing,

I'd be shocked if we make that.

[John] Today I'm gonna check in with oar

on everything that he's working on

and iron out some stuff that we're trying to solve.

[laughs]

-Wow, Orr. -[Orr] What's up, man?

How are you doing?

Those are the biggest doors and windows I've ever seen.

-[laughs] Yeah. -Wow.

[Orr] It wasn't easy to get them in,

but it makes a big difference, right?

[John] It's gorgeous.

[Orr]The inside-outside feeling

that you're gonna be getting is a lot better.

So, yeah, we're moving.

We got guys working on drywall,

soffits.

We've passed pretty much all inspections,

so we're pretty much locked and loaded here.

But let's head over to an area that's not as finished

and is holding us up.

So we spoke before, and I said,

As long as this door gets here at the same time as these,

I'd be good on timeline.

I'm not. I'm stuck now, just waiting for this door,

which I didn't want to happen.

And, uh, now it kind of like pushes everything back.

Do you know what's going on?

It wasn't something stock.

So it's something that needed a lot of customization.

And it took them a bit longer than expected,

but this will be here early next week.

Early next week. Okay.

This is stuck, and I need to start closing up walls.

The most I can wait is maybe, max,

another five days.

I'm gonna get on the phone. I'm gonna make some calls.

-I'm gonna try to push people as hard as I can. -You want me on those calls?

-Do you need me to-- -I can take care of it.

-I can take care of it. -All right.

You know, I was probably being overly optimistic

with him previously,

but the glass garage door is gonna come on time.

I hope.

I looked at some of the higher-end rentals in this area

and I was thinking more about the driveway.

You know, if we were to do all concrete,

it still feels like it's primarily for cars.

So would we be able to modify it

to something more like a rectangular strip

with turf in between.

I feel like it would make it a little bit more...

you know, part of the backyard and the entire property.

[Orr]You want to be able to see a little bit of greenery?

[John] Exactly.

Um, I mean,

it was just going to be the single pour here,

and we were good.

Now we're gonna have to add the turf

and take that into consideration,

which kind of deviates from the plan. Um...

It's something I want to do.

-Okay. Yep. -So let's do it.

[John] I'm definitely throwing a lot of changes at the team.

Yes, I'm spending more money.

But the return will make up for that.

If this renovation goes wrong,

I stand to lose all of the energy

and immense effort and sacrifice

that I've made over the last decade plus.

-[Jonathan on phone] Hello. -[Drew] Hey, how you doing?

You got a minute to chat?

[laughs] Yeah. Is this about John?

Who else would it be about? [laughs]

I was talking to Orr,

and he's stressed.

Both him and Lee are stressed.

Every two seconds, John is changing something.

There are 13 new change orders,

and that alone is about $50,000 to $80,000.

-Hmm. -I mean, it's affecting our budget,

-our timeline.-Yeah, that's not good.

Orr and Lee need to get over on to other projects.

You know, if we delay this,

then we're going to delay the next job.

We can't leave John to his own devices.

He needs a voice of reason.

He's got Orr. He's got Lee, you, me.

He's not listening to any of us.

And I don't understand how to rein him in.

Well, he's an entrepreneur.

He's in college. He's busy.

I mean, he's young. He's learning.

At this point, I would say we have to see this through.

You know, it's going to be frustrating.

But at the end of the day, I do think he has potential.

So we can't give up on him.

No, he has potential. And I want to see it through.

It's just how do you get through to somebody

who doesn't want to listen

to all the experienced people around him?

With patience.

-Yeah. -[Jonathan laughs]

Well, I'm gonna swing over there in the next few days

just to have a peek and see what's happening.

All right.

-All right. I'll see you later.-Bye.

[Drew]I'm heading to John's property to see everyone in person.

Thirteen change orders is pretty unbelievable.

I need to chat with Orr and Lee

to get a better handle on this.

Plus, John is meeting us later,

and I definitely have questions for him.

Man.

All hands on deck.

-[Orr] Good to see you. -I see a lot of glass.

Yep. All these doors are in, so.

[Drew] And it looks impressive.

But I just can't believe

that the budget blows.

What other change orders could there potentially be?

From what I know, I think maybe he just wants to add a fountain on the side.

-But-- -[Drew] Oh, yeah. Jonathan told me about that.

I think he also wants to do a cold plunge

and then I think some more carpentry work.

-Okay. Well, that's a lot of-- -[Orr] Changes, yeah.

And... And expensive changes, too.

-Correct. -[Drew] There's a tipping point...

-Right. -...where you're just spending way more

-than you're gonna see back any time soon. -Exactly.

[Drew] Can we look inside the garage?

-[Orr] Yeah. -[Drew] Okay.

So is this the door that you're...

-you have been waiting on or-- -Yeah.

So, we're still waiting on the glass or what?

[Orr] Uh, yeah, right now, it's just a custom fabrication

of the iron here,

and then the glass will be coming in as the second part.

-Okay. Is Lee inside or-- She's there? -Lee's inside?

-Okay, I'll be back. Yeah. I'll talk to you in a bit. -Yeah, awesome.

[Drew] You know, with the original scope of work we talked about,

he was already at the top of the market.

He could ask a premium rent for this property.

If you keep trying to push the ceiling,

you're the most expensive house in the neighborhood,

you're not gonna keep going up.

There's only so high you can go.

-Hey. -Oh, hi.

[Drew] I just heard, uh, from Orr all the change orders.

Oh, my God, I know. It's crazy, right?

[Drew] Is there anything to you,

like, in your mind, that is a little ridiculous

that he's adding?

Specifically, this whole thing with the fountain outside,

I do like the idea of having a water feature

and being able to open up the doors when you're in the space.

That feels okay to me.

But then he took it to a whole other level with this.

He really wants to sort of replicate

the Venice Canals in this space

along the back wall.

[Drew] I don't understand all that.

He also wants to bring in the... this big, like, a metal "Z"

that sort of, like, supports the counter over here.

Wait, what do you mean, a metal "Z?"

[Lee] So when you walk in,

it... it'll be, like, the first thing you see.

[Drew] We're not even finishing on time.

Cabinets aren't done.

We haven't even painted.

The flooring is not in, the garage is nowhere near finished.

Oh, I know there's a lot to do.

He's pushed the envelope on every single thing in this house.

He's gone custom wherever he can.

[Drew] He's draining his bank account

with all these extra features he's trying to throw in.

I know, and it-- it's a fine line--

-Oh. -Hey, hey.

-[Lee] Hi. -[Drew] I've just heard about

some of your fun add-ons that you're doing.

-I made some upgrades, yeah. -[Lee chuckles]

What's the deal with the "Z?"

It's the Zen in Venice.

We're for building "Zenice."

Are the-- Are these custom fabricated?

-Yeah, they are. -[Drew] Tell me, honestly,

how much are they costing you?

A few grand.

I think we're taking things to new heights.

That's... That's what I think.

These Z's, I don't get it.

We already had the plan.

You can't keep changing the plan

just because you have a new cool thing

that popped up on social media that you wanna spend on.

I'm sure they're amazing,

and it's nice, but it's still a few grand

when you think we're already around $60,000 to $80,000 over budget.

-[John] Mmm... -Because the original budget was $480,000.

I think we're about to $40,000 over budget.

We were... We were about that over budget

because of the... doing the footings, right?

Original budget, then there were the footings,

- and then you had about $35,000. -[John] Oh. True.

If you add that on, too, yeah. If you add that--

-Oh, no, I add on all numbers. -[laughing] You add--

An-- Any numbers that are over and above what we originally talked about,

-that's an add-on. -But then what's three grand,

-what's three grand if it's that much? -[Lee laughs]

Oh, man.

[Jonathan] I'm not even sure where the extra money is coming from

to cover all the change orders.

But it's frustrating 'cause you're mentoring somebody about

being financially responsible,

and then they're turning around and just pulling money

out of thin air from everywhere.

Well, even if these changes seem like small expenses right now,

it's gonna catch up with him.

I'm thinking of your budget and... and your return, right?

But at the same time, I think that going the extra mile

and spending more than other hosts

will earn high enough reviews to where the return will be worthwhile.

I mean, I hope you're right. I really do.

You are making a lot of the same mistakes that we made early on,

and it bit us in the butt because we realized,

-hopeful thinking is what you're saying... -Yeah.

...and it didn't pan out.

And the added amount of time to... to gain back

-what we were spending, it wasn't worth it. -[John] Mm-hmm.

[Jonathan] He's making rookie mistakes.

[Drew] And he needs to start listening

to the people around him who have more experience.

We're here to help him.

It's almost as if he feels he's the only person that can accomplish this.

What worries me is the fact that in the yard,

I personally think it's a bit busy.

Where... Where are you putting in the cold plunge?

That's the latest I heard, is the change.

So the cold plunge, we'd put right over here, right next to the sauna.

So, you know, are there any other costs that we still don't know

that are on top of the extra 75,000?

-No. -Well, that... Blow up the fountain,

we didn't really figure that out yet.

Yeah, that's potentially another eight grand.

Wait, you literally just said, "No. That's it for costs."

And then you have $8,000 for a... a fountain feature.

So the extra $80,000 in overages. That's it, right?

I'll try, I'll try.

It's-- Again, it's your money at the end of the day, so that... It's up to you.

But the one thing that bugs me is Orr told me

that we're now gonna be about five weeks behind.

I have Orr going on another project within that time frame.

That means you're now delaying my other projects,

and I need to make sure that we can do anything we can

that is not gonna be an add-on

-that's gonna delay him even more. -[John] Okay.

Because then you're costing me

more money on other projects, right?

-Definitely. -So please rein in whatever else we can rein in.

We don't wanna take away from other homeowners

that we made a commitment to them

to make sure that we're gonna get their project done.

-Definitely. -[Drew] All right, thanks, guys.

[both] Thank you.

[Drew] Oh, man! It's a great property.

I know he's gonna get a great rent for this,

but at the end of the day, he's spending so much

on all these extra little things that are not gonna get him

any more money for the property.

It's just eating into his return.

Plus, he's not accounting for any last-minute problems that could pop up.

You know, honestly, this is a complete example of diminishing returns.

This is quickly becoming the most difficult project that we're working on

because our investor is changing things last minute

or adding things on that throw everything into chaos.

Every time we think we know where this build project is at, it changes.

He's so focused on making this the best property anyone has ever seen,

he's not even paying attention to the stress

that he's causing to us in our trades

and everybody who's trying to make this happen.

And he's... he's definitely got the blinders on,

and he's focused on something that he gets in his head.

Not every good idea is a good idea.

[cell phone chimes]

[cell phone chimes]

[cell phone chimes]

[John] This is incredible.

You know, as you're renting the place,

one thing that's important is how it's going

to uphold with the renters,

-it's this. -[John] Yep.

[Evan] This is gonna uphold, for sure,

with scratches and chips.

[John] The brothers have been a cheat code.

They've introduced me to a lot of amazing suppliers and vendors

who have provided us with a lot of really incredible products.

[Orr] Any type of rentals,

the biggest thing is the low maintenance, you know.

Not having to deal with anything here.

It's just, once we install it, it looks great.

We're in, and you know, we're... we're moving.

[John] Part of the drawback with the bathroom

is putting so much glass in it, you lose some privacy.

So, we're trying to solve that by adding electric glass

to where it can, you know, turn opaque with the flick of a switch.

All of the decisions that increase spending and make change orders

are to improve the quality of this home

and greater guest satisfaction.

You know, I'm all about, like, calculated strategy and calculated risk.

I think we have a little bit different definitions of that.

[Drew] Early on, we told John that creating a beautiful front deck

is an important part of the overall design.

[Jonathan] What if we extended a deck across

and moved the front entrance to the far side?

My end goal is, can we open up the entire back side of the house

so that we have as much glass as possible?

I think that makes sense to do.

[Drew] Having a scenic outdoor space off the front of the house

is gonna give potential guests a good first impression

and really take this rental to the next level.

[Orr] So, we ran into a little issue with the deck.

Inspector came by after drywall inspection

and basically was saying that he did not want the deck,

like, extending out as far as what the plans say.

We have it extended per the plan

all the way to here, and we left about 20 inches

for... for the trees...

But he doesn't want it extending out past six feet.

So we gotta cut this whole thing back

and meet that six foot.

We need to be six-foot setback,

-or six foot off the-- -Six foot off the, yeah,

-off the front of the house, yeah. -[John] Okay.

We can only extend out six feet

and then do our stairs.

We built it as per the drawing,

just as planned, but it doesn't matter.

The deck's gotta be smaller.

Basically, we undo a lot of what we're doing now,

-which is what we're working on. -[John] Wow. Okay.

It was a little bit disappointing

that we had to, you know, trim it back and change it up.

Once we start wrapping this deck up,

we'll start wrapping up the back.

The inside?

Great, we're moving in there.

We have all the finishes, so that's... that's moving pretty quickly.

But we do have that issue with... with the garage door.

We're still waiting for the glass panes.

I mean, this is starting to get to that finish line,

but I don't know if we can make it with the timeline on the garage, so...

[John] You know, I was probably being overly optimistic

about the garage door coming on time.

But, uh, they're finally here,

and, you know, I'm supporting Orr in any way I can

in meeting his timeline.

Hey, you know, and the one thing I would say is, well, John isn't lazy.

He... He's a hard worker and he's a go-getter.

I think his mind is a mile a minute all day long.

He just needs a little bit more of an infusion

of the right knowledge and the right things to focus on

to make sure that he's going down the right path,

because he doesn't have that experience yet.

[John] I'm just buzzing with excitement right now

on the progress of the project.

It's like every day, a little piece of the puzzle gets put together,

and the vision gets a little bit closer to reality.

[Drew] John is obsessed with the most expensive features in this house.

He's obsessed. That makes me nervous.

[Jonathan] I am conflicted with John.

I see this guy who sees this big dream

and he's willing to put in the work.

On the flip side,

he's not working with real numbers

and he's way too optimistic.

[John] This finally coming to reality is like a dream coming true,

and, you know, I just wanna, like, pinch myself over it.

So we're all focused, wanna make sure

that we knock these last items out.

[Lee] I really can't believe we're at this point.

[John] It's definitely coming together.

[Lee] It is coming together.

I think this sectional works perfect in this space.

[John] And this is resistant fabric, right?

[Lee] It is. Yeah, I know the white's a little scary

for rental properties.

The brothers are backing John with a professional real estate photographer

to take photos for his short-term rental.

It's gonna make the property stand out,

and it's a nice way to finish this project.

[John] I think that the presentation of my listing

is gonna be make or break

for making sure that it's a success.

This project has been a long, long road,

buying it a year ago now. You know, we've...

we've worked so hard on this for so long,

which is kind of crazy to think about.

So the stakes are high.

I'm definitely nervous to show the brothers,

but I'm feeling pretty confident.

-Big day for him to finish this. -It is.

Walking up, I am a little nervous

because we've had many walk ups to the property,

and almost every time we start on a positive note, and then there's been

-something that he's doing that's-- -A surprise.

And not a good surprise.

We learn of a new add-on, something that's changed,

-something... -So, you... you walk in with optimism

and you leave with...

-I'm walking in with trepidation. -...frustration.

-I'm walking in with trepidation. -...frustration.

That's what it is.

Hey, how's it going?

-[John] ... -What's happening?

Oh, my gosh, you have been busy.

[John] Welcome to the Zenice Beach House.

-[Drew] Oh, my God. -[Jonathan] You have some curb appeal.

I will say, looking at it from the street

just the approach alone,

-it looks great. -[Drew] It's great.

[Jonathan] When you rent a place,

-you're judging everything you see. -[Drew and John] Yeah.

[Drew] It's simple, it's clean, it's modern.

The first impression is awesome.

[Jonathan] Oh, oh! [whistles]

Oh, my goodness! Look at this.

You killed it!

-I mean, it's nice. -You did good.

-It looks-- -[Drew] It-- It is nice.

Incredible, wow!

-The architectural doors, the sliders are incredible. -[John] Yeah.

-They really, really look nice. -Yeah.

[Jonathan] I love the natural light.

I love the canopy of green all the way around.

[Drew] Okay, hold up.

-Let's discuss your backdrop, your Zenice backdrop. -Yeah.

-[Jonathan] Mm-hmm. -[Drew] I wasn't getting your picture.

I didn't realize you had something that you could

-see through, like this. -Yeah.

Can I actually stand on that?

[John] Yeah, go ahead.

-It'll take my weight? -[John] Yep.

I tracked down a bridge that has similar dimensions as the Venice Canals.

I can see people coming out here and just, like...

-[mimicking camera shutter clicking] -[John] Yeah, I know,

this is the selfie spot, for sure.

[Drew] It's... It's cute.

You... You spent extra money in the areas where you wanted

to make a huge impression,

because at the end of the day, you wanna have a certain feel.

-Definitely. -So now that you're all done,

those decisions that you made, how does it feel?

It feels like they all paid off.

Well, I can tell you, you won't know yet.

It will all come down to the price

-that you rent it for... -[John] Mm-hmm.

...and it'll all come down to the availability.

-But, uh, this is very nice. -[Drew] Well-- Then also, when you think function,

tons of seating, the island is massive.

So for entertaining and serving platters, this is great.

All the things you would not typically have

in a renovation house, in some of the small houses

that you get in this area, you have it.

Looks amazing.

[Jonathan] I love the vibe. I love the layout.

But from a business perspective

and more about, what are people just gonna pay for?

-Yeah. -You'll find out if you ended up getting

the bang for your buck with all those extras

after you start to see that people rent.

[Jonathan] I would say, living room, kitchen, 10 out of 10.

[John] Yeah. Let me show you the bedrooms.

-So, this is the primary bedroom. -[Jonathan] Okay.

-Ooh, I love the-- -[Drew] Oh, the fire pit's turned out really good.

[Jonathan] So much better than the rustic original fireplace.

[John] Yeah. Yeah, I think that was a huge step up.

Wait, wait, wait, wait! What?

That's it for a closet?

[John] It's a micro-closet.

-Because the primary use isn't long-term... -[Drew] Yeah.

...I think people can deal with it.

-Oh, well... Well, you will see. -Okay.

[Drew] I mean, when you start getting feedback.

-Hold on-- -[Jonathan] I wouldn't be happy with that, but--

-[Drew] Yeah, yeah. -A little peek here.

This is weird. What is this?

[John] It's a Unishower.

[Jonathan] Yeah, I'm very confused by this.

If somebody is showering from over here,

somebody could walk in and see everything.

Yeah, we're gonna get some electric auto-frosting glass.

-[Jonathan] Okay. -[John] And so people will be able to kinda, you know,

toggle and configure what level of privacy versus openness they want.

And so that will be ready before renters show up.

-[Drew] Yeah. -[Jonathan] Okay.

Well, so there's still... still stuff to happen.

-Uh, let's take a peek, yeah, at the other bedroom. -Wanna look at the bedroom?

-[John] So, this is the second bedroom. -[Drew] Okay.

[Jonathan] It's a nice size.

I love that it opens to the yard as well.

Pretty much every door and window in the home

has motorized electronic shades,

-so you can press a button, tap something on app... -[Drew] Yep.

-[Jonathan] Okay. -...turns totally private.

[Jonathan] This is great.

[Drew] Oh, this is amazing. It's gonna sell the place,

opening these doors. Look at that yard!

-That's the view. -[Jonathan] Wow.

And better than the dirt pit concrete pad thing

-that was already here before. -[Drew] Oh, yeah.

-[John] Yeah, yeah. let's not talk about that. -[Drew] All right.

-[Jonathan] Yeah. -[Drew] Look at this.

Cold plunge, sauna, a hot tub, fire pit,

whatever you want, we got it.

We check every single box as far as amenities.

[Drew] I like you're checking off all the boxes.

However, there's a certain point where you're just eating into your own profit.

It's like when you tell someone

don't sell what's already been sold.

[Jonathan]You don't need to spend all that extra money.

[Drew]We'll see if that actually turns into rental dollars.

This looks amazing.

[John] The... The goal was to make this, like, a total flex space.

-I mean, it can be a movie room. -[Jonathan] Yeah.

[John] It can be maybe a photo studio.

-It can be somewhere you take naps. -[Drew] Yeah.

[Jonathan] It was definitely worth putting the Murphy bed in here.

-I mean, that's making a huge difference for you. -[John] Yeah.

[Jonathan] I mean, this... this is great.

I love the fact that instantly you have

-that multifunction that you would want. -[John] Mm-hmm.

It's got its own bathroom...

laundry. I mean, you've got everything out here.

I love how this opens up on both sides.

[Drew] This is great.

Anyone looking at this would say,

"I hit the jackpot with this rental."

I feel all the weight off my shoulders,

given the scope and scale of this being such a massive project.

Obviously, there's still the unknowns

of how it's gonna perform on the market.

But, you know, I have a high degree of confidence

that people are gonna love this place.

This actually looks even better than what I had envisioned in my mind.

-Yeah. -So, I do think you're gonna stand out

as a premium property, which is gonna get you a premium rate.

-Yeah. -So originally, you bought this place

-for what, $1.3 million? -[John] $1.35 million.

[Jonathan] Yeah. And then you had your renovation

that you had previously done, which was about $150,000.

You had to redo a lot of that stuff.

When we came onboard,

that renovation budget was about another $480,000.

So all in...

So, you're just shy of $2 million,

but you were almost $90,000 over what the budget was.

[Jonathan] Which brings your grand total to well over $2 million.

You said you figure you can probably get,

what, about $680 a night, 80% occupancy?

-Correct, yeah. -[Drew] Let's be a little conservative,

say we get 600 bucks a night, $170,000 a year on this place.

-I mean, that's not bad. -Amazing.

[Drew] But because of your overages,

now you're gonna make that back over a longer period.

I don't think it's gonna matter...

at the end of the day.

Well, I mean, it matters

because it's bringing down your return a little bit.

If you think of what our contribution was for you,

I mean, it was $150,000 of value

-between labor and material, right? -Mm-hmm.

So that was the cost of all the mistakes you made in the beginning,

spending $150,000, that you had to redo anyway.

-So, it's a bit of a wash. -[John] Yeah. Yeah.

-Lesson learned. -Definitely. Yeah.

You know, working with you guys has definitely

reduced the risk of the project,

saved a ton of money,

accelerated how fast I've learned.

[both] Yeah.

I'm kinda just mind-blown.

Not everyone gets to be backed by the bros,

to have their guidance and input and mentorship and resources.

This place wouldn't be anywhere close

to where it is today without them.

I think this whole project could have been a massive trip up,

but you've got yourself through it.

You've got the drive,

you've got the ideas, and now you're ready

to actually start to generate that revenue.

My hope is, this is gonna do so well

that you'll forget about your plans to add a second story

-'cause it's just not gonna be worth it. -Could happen.

But who knows? For now, I think it's a short-term rental.

If you get the price right, you're gonna have a really great return here.

I think you could have listened to a bit more of our advice.

It would have helped him down the road,

but at least he's still in a position

where it's a good investment, and he's done well.

This is gonna be a successful project,

and I do think where it counts,

you were listening and you were learning, and that's important.

But more importantly,

he's now gonna have an incredible career in real estate

because of these little learning moments that he's had early on.

He's 22 years old,

he has a long career ahead of him.

There's one thing we have to do...

and that's celebrate.

-[Drew] Yes! -[Jonathan] I wanna have drinks

in front of that Zen wall.

[John] This project gives me stability and security,

which is something that when I was younger,

I didn't have. I'm incredibly grateful

for the help that they've given me.

It's made all of the difference.

You know, I couldn't be more thankful.

Shortly after completing the project,

John posted his rental online

for a minimum booking period of 30 days

and a range of 25 to 30 grand, depending on the month.

Wow! That is a bold and unexpected move.

Actually, I would expect nothing less from John.

But if this pays off, that means that the slider,

the waterfall feature, the big Z's,

this was all worth it in the end.