In this episode of the Ironclad Underwriting Podcast, Jason Williams and co-host Frank Patalano break down the true financial impact of concessions in multifamily real estate. As part of their mini-series on the real cost of vacancy, they explain how concessions inflate economic vacancy, quietly erode effective rents, and can wipe millions off a property’s valuation if misused. Through real-world examples, math walkthroughs, and candid asset management stories, they make the case for using concessions sparingly, strategically, and with a clear exit plan.

Topics Covered

• Economic vs. physical vacancy and why concessions widen the gap
• Why two months of free rent equals a ~16% annual rent discount
• How concessions directly reduce NOI and property valuation
• Short-term “burn-off” concessions vs. long-term/perpetual concessions
• Real examples: free rent, TVs, gift cards, waived fees, parking, and internet
• Concession creep and the danger of always running “specials”
• Competitive pressure and how market behavior distorts true market rent
• When concessions make sense (lease-up, distressed occupancy, seasonality)
• How to think about concessions during underwriting and pro forma modeling

Notable Quotes

• “If you give two months free rent, you’re basically giving a 16% discount on the rent for the year.”
• “That $300,000 in lost rent at a six cap is a $5 million hit to your valuation.”

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In Part 3 of The Real Cost of Vacancy series, Jason Williams and co-host Frank Patalano break down one of the most misunderstood concepts in commercial real estate underwriting: the difference between physical occupancy and economic occupancy. This episode dives deep into why properties can appear “full” on paper yet still bleed cash, how bad debt, concessions, loss to lease, and operational decisions impact true performance, and what red flags investors should look for during due diligence.

Topics Covered

• Physical vacancy versus economic vacancy and why the difference matters

• How a property can be 95 percent occupied and still lose money

• The impact of bad debt, delinquency, and non-paying residents

• Concessions, loss to lease, and how they reduce economic occupancy

• Model units and employee units as hidden drivers of economic vacancy

• Step-by-step examples calculating economic occupancy on a 100-unit property

• Why expenses and debt structure can erase strong occupancy numbers

• Agency debt requirements including the 90 for 90 rule

• Red flags on rent rolls including balances due, payment plans, and eviction notes

• Risks tied to lease expirations during low leasing seasons

• How eviction timelines and local laws affect underwriting assumptions

• What a healthy spread between physical and economic occupancy looks like

Quotes

“Physical vacancy is completely different than economic vacancy. You can be full and still be broke.”

“You don’t underwrite buildings based on how full they look. You underwrite them based on how much money they actually collect.”

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Overview

In this episode of the Ironclad Underwriting Podcast, Jason Williams and Frank Patalano continue their deep dive into the real cost of vacancy by unpacking lease up assumptions. They explore what lease up really means in acquisitions and ground up development, why many investors get it wrong, and how competition, concessions, seasonality, and management execution directly impact underwriting accuracy and returns.

Topics Covered

• What lease up means in real world underwriting scenarios
• The difference between physical occupancy and economic occupancy
• Why 90% occupancy is not the same as being stabilized
• How agency lenders define stabilization with the 90 for 90 rule
• Lease up challenges in acquisitions versus ground up development
• The impact of competition, concessions, and nearby properties
• Absorption rates and how to interpret them without overcomplicating models
• Seasonality and why lease expirations matter more than timelines
• The hidden cost of concessions and how they affect long term value
• Operational realities like staffing, marketing channels, and leasing execution

Quotes

• “Nobody is living in a vacuum so you have to figure out what exactly is going to affect your lease up projections”

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Overview

In this episode of the Ironclad Underwriting Podcast, Jason Williams and Frank Patalano examine the true financial impact of vacancy beyond simple underwriting assumptions. They unpack how turnover costs, deferred maintenance, resident behavior, and property class dramatically affect cash flow, timelines, and overall asset performance. This first installment sets the foundation for understanding why vacancy is often far more expensive than it appears on a spreadsheet.

Topics Covered

• Why vacancy assumptions often underestimate real financial exposure
• The true components of turnover costs in multifamily assets
• Differences in turnover risk across Class A, B, and C properties
• How deferred maintenance compounds vacancy duration and expense
• The operational timeline from move out to re lease
• The impact of staffing limitations on vacancy length
• Pest infestations, pet damage, and extreme unit conditions
• When turnover costs shift from operating expenses to capital expenditures
• Why units you cannot access during due diligence often carry the highest risk

Quotes

• “Vacancy is not just lost rent. It is time, labor, capital, and momentum quietly draining from the asset.”
• “The units you cannot get into are usually the ones with the biggest problems, and the biggest costs.”

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Overview

In the first episode of 2026, Jason Williams sits down with Frank Patalano and Angel Williams for a wide ranging and honest conversation about the realities of investing, rising costs, and what it actually feels like to operate in today’s economy. From grocery store sticker shock to refinancing stress, personal health goals, travel plans, and long term strategy, this episode blends economics with lived experience. It’s a grounded discussion about cash flow versus equity, patience in investing, and setting intentional goals for the year ahead.

Topics Covered

• How everyday price increases reveal the real state of the economy

• Why feelings at the checkout line matter more than headlines

• Cash flow versus equity and why both matter at different stages

• Refinancing challenges and navigating lender conversations

• Liquidity stress and feast or famine cycles in real estate

• Setting realistic business and personal goals for 2026

• Travel, conferences, and building relationships in the industry

• The long timelines and hidden costs of development projects

• Balancing ambition with patience in a shifting market

Quotes

• “You can’t eat equity. You can feed yourself with cash flow, but equity only works if you can actually access it.”

• “If you don’t feel like you’re paying a fair price when you’re shopping, you probably aren’t, and that tells you more about the economy than any report.”

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Episode Overview

In this episode of the Ironclad Underwriting Podcast, host Jason Williams is joined by Frank Patalano for a deep dive into refinancing in both residential and commercial real estate. Drawing from real-world deals, investor experience, and underwriting realities, they break down the three primary reasons to refinance, when it makes sense, when it doesn’t, and why refinancing should rarely be treated as a guaranteed part of a business plan. The conversation covers leverage, equity extraction, loan maturity risk, and the hard lessons that come with refinancing in volatile markets.

Topics Covered

• What refinancing really means in residential vs. commercial real estate
• The three core reasons to refinance: equity, better terms, and loan maturity
• Pulling equity to redeploy capital or return investor funds
• How refinancing impacts cash flow, returns, and leverage
• Fully amortizing loans vs. balloon notes and bridge debt
• Why refinancing should not be assumed in underwriting models
• Cash-out vs. cash-in refinances and when each makes sense
• Interest rate risk, cap rates, and refinancing in changing markets
• Real-life refinance case studies, wins, and costly lessons
• The role of banks, lenders, and why switching lenders can be a valid reason to refi

Quotes from the Episode

• “There are really three main reasons to refinance: to pull out equity, to get better terms, or because your loan is maturing.”
• “Refinance when you can and when it makes sense, but don’t build it into your business plan, because you can’t predict interest rates or loan terms.”

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📌 Episode Overview

In Part 3 of the Vetting Sponsors series, Jason Williams and Frank Patalano dive deep into one of the most overlooked, but critical, areas of passive investing: fee transparency and sponsor communication. This episode breaks down common fee structures, how they’re sometimes misrepresented, and why clarity matters more than ever in today’s market.

🧠 Topics Covered

• Why transparency around fees is non-negotiable
• Acquisition fees: what’s reasonable vs. misleading
• Asset management fees and how they’re actually calculated
• The dangers of raising multiple years of fees upfront
• Disposition and refinance fees explained
• Capital calls: legitimate reasons vs. red flags
• Dilution vs. investor loans during capital shortfalls
• Common communication breakdowns between GPs and LPs
• Why “everything is in the portal” is not an answer
• Red flags when sponsors avoid direct questions
• Green flags that signal strong, trustworthy sponsor teams
• The importance of underwriting access and investor education
• Why experienced sponsors openly discuss past failures

💬 Notable Quotes

• “Fees are okay. Hiding them is not.”
• “Over-communication is always better than under-communication.”
• “There are no failures, only feedback, if you’re honest and willing to improve.”

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Overview

In this episode of the Ironclad Underwriting Podcast, Jason Williams and cohost Frank Patalano continue their deep dive into how investors should vet real estate sponsors and operating teams. Building on Part One, this conversation focuses on common misdirections, inflated track records, communication breakdowns, and excuses investors often hear when deals underperform.

Topics Covered

1. Why vetting the sponsor is as important as underwriting the deal
2. Inflated track records, door counts, and misleading asset claims
3. The difference between being active in a deal versus passively listed on a team
4. Red flags around distributions, delays, and vague explanations
5. How poor communication erodes investor confidence
6. Property management failures and why operators must take responsibility
7. Refinancing delays and how sponsors should communicate challenges
8. Due diligence on teams, social media research, and reference checks
9. Why investing in a deal is like entering a long term relationship

Quotes

1. “You’re not just investing your money. You’re investing everything. It’s almost like a five year long marriage.”
2. “Over communication is always better than under communication, especially when a deal isn’t performing.”

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