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Show Notes:
In this episode of the Mission Matters podcast, host Adam Torres welcomes back Scott A. Chaplan, Executive Chairman of Del Rey Urban and one of the original contributors to the Mission Matters book series. From his entrepreneurial roots in Los Angeles to leading a nationally expanding real estate investment firm, Scott reflects on the grit, creativity, and character it takes to thrive. He shares actionable advice on raising capital, building strong teams, and embracing growth—personally and professionally.
About Del Rey Urban
Del Rey Urban (DRU) is a full service real estate investment, property management, brokerage, fund management and advisory services firm. Their Executive Team has successfully structured and managed numerous real estate, renewable energy and private equity funds as well as analogous syndication structures over the past several decades. Historically, thematically, these captive funds were either tax advantaged, income and/or opportunity/appreciation driven. Currently, after successfully closing Del Rey Urban Distressed Residential Opportunity Fund I, DRU manages the Del Rey Urban Opportunity Fund, II, Del Rey Urban Income Fund, Del Rey Urban Income Fund II and dozens of other private syndications. These funds are the evolution of respective and collective investment by the Managing Director and Executive Team in distressed urban real estate during the current and previous economic downturns.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest in the show. To set on overtop mission matters.com and click on Be Our Guest to Apply. All right, so today is a very special episode. It’s commemorating the most recent book of mission matters that we launched.
So volume 11 of our bestselling mission matters. Business Leader series and we’re welcoming back onto the show. Scott Chaplin, I like to call him one of our founding fathers or founding authors of Mission Matters. Let me tell you, Scott was supporting us way back when before we had a website, before we had a podcast.
Heck, before we had anything. I don’t know how we talked him into it, but we’re gonna get into more of that in a bit. But first off, Scott, man, welcome back on the show, Adam. It’s a pleasure, man. Nice to see you as always. Alright, so we’re gonna start this episode before we dig in, like we start them all with what we like to call our mission matters minute.
So, Scott, at Mission Matters, our aim and our goal is to amplify stories for entrepreneurs, executives and experts. That’s what we do. Scott, what mission matters to you? I like to help people, Adam. I like to teach as the executive chairman of Delray Urban. We invest in real estate. We advise around real estate.
And we also have an advisory services firm for businesses. So teaching, writing and putting together deals are the things that I like to do. And we do that a lot in the urban core where we help a lot of people around the country. It’s awesome. Great having you back on Scott. And first off, I gotta, I gotta show this.
So the people that are watching the video at home or on YouTube can can see this, the people that cannot, that are in audio and that are watching maybe listening in their car. So I’m holding up a book right now and this book has myself and Scott on it. This is the very. First edition, I can’t say of Mission Matters ’cause it even predates Mission Matters.
This is the first edition of Money Matters, which was the original name of the company. This goes back to 2018. It was our very first project, our first book project that we did, a collaboration, and it became a bestselling anthology series. Think of it. Much like, you know, chicken Soup for the Soul, but for entrepreneurs and executives and experts.
So a different niche. So Scott is now in the most recently released volume 11. And so I think about it. He’s in the, the first one we did, and now he’s in the most recent, and now, Scott, can you believe this man, we published over 400 authors. Now. I, I can’t believe it. Going back to like when we first started, when we didn’t have a website.
It’s awesome. You’ve done a wonderful job, my friend. I’m proud of you. Just awesome. And so, yeah, it’s a, it’s a, well, I appreciate you. I appreciate you. I appreciate all the authors that have really supported us along the way and, and given us the ability to, you know, build a platform and to create a space that, a safe space that entrepreneurs and executives could come tell their story, showcase their work, and know that, you know, there’d be a lot of thought and intent put behind it.
So it’s fun. It’s fun. I feel like it’s like our own fraternity now or this group of authors that have all come together. It’s been a lot from different walks of life, different areas. But Scott, for those that maybe aren’t, aren’t familiar with your previous work or haven’t dug into the book yet, maybe let, give a little bit of your background and really just how you got started in business and in real estate.
Let’s start there. Sure. I’ve been entrepreneurial since I was a kid, so. From college where I started my first business to coming out of college and getting into the wholesale business for automobiles, paying for my law school with that, and then becoming a lawyer, becoming a business lawyer, and starting to syndicate re real estate deals in the early nineties.
So, and I’ve been doing that ever since. And over time. That’s become a concentric to Los Angeles project to now 10 cities, seven states across the country and growing. Yeah, and that’s become our business. We vertically integrated to add consulting and to add design. We have property management and we’re a fully diverse real estate boutique.
Really a real estate investment bank with advisory services. I. So it’s grown a lot. Yeah. And it’s evolved a lot and I think I’ve learned a lot more through the Scrape Your Knees, lessons of life than any of the books that I’ve read. Although I read a lot of books and write up here. Now were you, were you born in la Scott?
Are you LA native? Yeah, I am. I’m an indigenous creature to Los Angeles. I’ve been here all of my life. Yeah, I thought so. I mean, I know you as an LA guy, but I, I never asked you that. Yeah, I thought so. Huh. Yeah, I spend half my time now in Texas. Mm-hmm. We have a big presence there and a home there, and a daughter there, which is my most compelling reason for doing anything.
And so I love it there. But I also love my roots. I love Los Angeles, my friends, and we have this, this is the headquarters to our business. Hmm. Talk to me about those early days of real estate. Like how did you, how did you originally get into, get into real estate and start doing deals? Like what drew you into that side of things?
I was in law school and I didn’t like the idea of paying rent to somebody else. It just bothered me. And so I wanted to try to put together a deal where I would own a place, and the only way to, I didn’t have, you know, the, the fundamentals I was missing were. Credit, cash, right. Income. So I went, you don’t need any of those.
No cash, no credit, no income. Perfect. It was perfect. So I tied up a deal and then I went to the bank and surprisingly, they agreed to give me a loan, but it wasn’t enough. Wow. So I decided to ask the seller to carry back some of the financing. Mm-hmm. And to my surprise, they did. And I learned an important lesson there, which is the closed mouth never gets fed.
Oh. So if you want it, ask for it and insist upon it and work for it so that they agreed to carry back the second. Mm-hmm. Then the bank said, you also have to show income. So I went to law school and I said, who wants to live with me in my place? And I got a couple people to sign leases, took it back to the bank and said, I have income that made the loan.
We closed the deal and I held that property for 15 years. It’s a rental property and continued to buy. So from that point it went into multifamily, different houses, flipping houses, buying, and. Holding apartment buildings mm-hmm. And everything else. Yeah. Before we get into more, more present day stuff, I wanna stay in those early days a little bit longer now, because there’s some people that are just getting into the business now and they’re, they’re thinking they’re gonna listen to this or watch this and be like, wow, you know, Scott did it.
Like, but he can do it. I can’t. What, what kind of advice would you give to that, that new group of entrepreneurs and or would be real estate professionals that are just getting their feet wet? Like what kind of things would you tell them? The first thing I would tell ’em is to stop. Stop setting your own limitations.
Mm-hmm. There isn’t anything you can’t do. If you wanna be in the real estate business, you wanna put together deals, you wanna represent buyers, whatever it is that you wanna do in that, or any business. As long as you start with a plan, there’s a product market fit, so there’s a demand, and then you start setting out your strategies and your tactics.
Mm-hmm. There really isn’t anything you can’t do. Money is fungible. There are a lot of people out there that have capital that will invest in good projects. Mm-hmm. So it’s about finding the good projects, doing what you say you’ll do, putting together a team of people that are like-minded, that round out the weaknesses that you have in your own learning or knowledge.
Mm-hmm. And going for it simply going. Talk a little bit more about that concept of raising money and, and even in the beginning, like you said, you went to the bank. You you didn’t necessarily know that they weren’t, that you were surprised they gave you some money, right? Or they were gonna, but it wasn’t enough.
So then you went back to the seller. So I, I think I. The creativity and the thought process sometimes around for many is that, you know, you have to have the money, you have to know everything upfront. You’re talking about themes such as bringing the team together, leveraging, using other people’s capital in order to get what you want.
Like talk a little bit more about that. For sure. So when I started, other than the first deal that I did when I started doing larger deals, the second deal was 19 units. The third deal was 36 units, and it kept growing. I went to friends and family. I made a lot of presentations to people about what the cash flow returns would be if they invested with me.
Yeah. And I in, I ensured that they got paid. And they did well. And so they continue to come back and they still do today. Wow. The projects are larger, the investors are larger or they’re putting in more, but it continues to happen and there, there really is capital, which everybody gets paralyzed about, is really not limiting factor in deals.
It’s the ability to find and underwrite intelligently good deals. Hmm. And so anybody can learn it and you have to just believe in yourself. Find something that you wanna execute on, jump in and execute. We write lots of offers all the time. Mm-hmm. We don’t expect to win every one. We win the ones we win, and then we close the ones that make the most sense.
So we have a very high closing ratio. So we do a pretty good job of vetting it, but that’s after a long time of experience, more time than I’m willing to admit. Of experience. Yeah. I’m still surprised by the way that that first bank made me that loan, which is probably the reason that that first bank isn’t in existence anymore.
You know, what kind of loans are you guys making to a kid that doesn’t have income or credit? Yeah. But you’d be surprised, and many people got started that way with mm-hmm. Developing a lender relationship that. Work for them. Maybe a smaller regional bank or credit union and going out and putting a deal together.
I tell people, if you wanna start small, get a duplex. Hmm. Print out the other half. Show that income. Yeah. Get a loan that’s appropriate for that. Hold that property, rent your unit, refinance it. Go buy another property. Mm-hmm. And continue rinse and repeat to do that. And then the other thing that happens is that people get scared.
’cause markets change. Mm-hmm. Oh my God. The market might be going down. How am I possibly gonna make money? Mm-hmm. Well, it’s all about friction. It’s not necessarily about the positive indicators of every market. Mm-hmm. There’s money to be made when the markets go down. In fact, most of mine has been made when the markets went down.
Interesting. We bought distress. So people say, well, what do we do? The deals are trading slower. Okay. Then you go back to the seller and you say, look, I need you to make concessions. I need you to finance this deal for me for the first two years while I put it together and increase the income so I could refinance you.
Yeah. But at least you’ll get cash flow. So there are a lot of ways It’s no different for businesses when I advise small. Medium, large businesses. Mm-hmm. We have a practice area and family offices where we advise family offices. It’s no different. The fundamentals are the same in business. Mm-hmm. Manage the capital, budget the capital, get a return on every labor hour that’s happening.
Mm-hmm. And drive the business forward as you know. Yeah. Yeah. Well, I wanna shift slightly here. We’ll continue on this, and I wanna pick this up. And I also have your, your most recent, the most recent book, volume 11 in my hand. And we’re gonna dig into that a bit as well. But I do wanna take a moment and maybe as an aside, and get into the educational component of what you do as well.
Whether it’s speaking, whether it’s teaching, ’cause you’ve had this whole other linear path that you’ve you know, pursued while. Doing real estate while speaking, while, while doing real estate, I should say, while advising businesses like all these other things, like where does that educational component and that need to give back, where does that come from?
Probably my family, probably the way that I was raised, and a core value of giving back and trying to share blessings that you’ve received. Mm-hmm. So I, I knew how to teach, I knew I knew how to teach because I would help people with the things that they were working on from. A young age and I liked it.
So in law school I got involved and I ended up teaching at the law school at Pepperdine. Mm-hmm. At their Center for Entrepreneurship and Technology Law. And I, and I was an advisory board member. I loved that. Mm-hmm. I went on that center. I was an advisory board member when it was first formed, so we kind of helped get it off the ground.
Now it’s doing incredibly well. Then I went on to teach at Kaplan University to teach people how to get real estate licenses, broker’s licenses, and other core classes. And I love that because you can see the connection, you can see when you, when somebody’s learning from what you’re saying and when they’ve got a true interest and you can pour into them.
And the accumulation of knowledge is interesting. But if you don’t share it, what are you doing? Seems very narcissistic to me. So I really do love to share. I. And then I bring people into the team who have that learning, passion, commitment, hardworking, and want a family atmosphere, but wanna do great things.
Mm-hmm. And people around here recognize that there isn’t anything we can’t do, so what is it we should do? Yeah. What keeps you motivated on that side of things? Like when it comes to mo, to rallying the troops, the team, like all of that, like that, that side of leadership, like what keeps you motivated and going, especially when things, market’s going against you, whatever it is like that, whatever gets you down.
Like what keeps you motivated? Well, there’s a drive to win for sure. Mm-hmm. I’m competitive and I don’t quit. I’m tenacious, so I. I, I haven’t quit anything. Got that dog in you, Scott. Come on. Yeah. Yeah. You know, and I have a lot of people who depend on me. Yeah. And they depend on me to lead. They depend on me to support and protect and provide.
Mm-hmm. And I take that role very, very seriously. As a lawyer, I take it very seriously as an advisor, as CEO. I’m critically and deeply invested in the success of the people around me. And often I’ll be the last person to be paid. Mm-hmm. Because I’m taking care of everybody else. And that’s okay. I still feel like that’s a good day’s work.
Yeah. And everybody that works with me is part of my family. Mm-hmm. And if they’re not, they’re probably not gonna work for me that long because I, and I need it. And now the team that I’ve born needs that kind of connection. That’s how, that’s our DNA staying staying on that kind of train of thought.
When we, when we’re talking about team, and this has been a theme throughout this entire interview of building a team, whether they’re direct reports to you or, or otherwise. Talk a little bit more about your cons around the team in terms of like partners, like whether it’s you know, real development side of things or any of the other things like how do you look to attract and how do you kind of like vet who you feel are the right people to work with and for you?
You know, I like to, it’s, it’s what I call the agnostic dissenter. Mm-hmm. So when I’m talking to people, maybe I’m talking to professional athletes who need advice, and we’re talking about how to put together a team. Well, everybody on your payroll is getting benefited by the dollars that you make. That’s how you’ve set up your construct.
So they’ve got their own incentives, which way may not be in line with your overall life goals. Mm-hmm. So who’s that person that’s smart that you trust and is gonna tell you exactly what the truth is with no upside at all? Listen to that person. Have somebody like that close to you? What is it that you don’t know?
What is it that you want to know that you don’t know that you need to know? Yeah. And where’s that seat being pulled? It’s like the, the book Jim Collins Good to Great. Yeah. You need to put the right people on the right seats in the bus. You really do. And you need to be self-aware enough to recognize that I’m not great at that.
Mm-hmm. I need somebody who is, ’cause that’s a core element of this machine. Mm-hmm. And if we wanna expand in that direction, maybe we want to go into the design business, which we’ve done because we design our own properties. Mm-hmm. So we’ve expanded that beyond our own properties. Well, we need an exceptional designer with great interpersonal skills, which happens to be my partner, Consuela.
Mm-hmm. And that gives birth to that business. And then I put energy behind it. We ral the right troops to undergird it and off we go. And it’s been that way throughout my career that there was a point in time where one of the businesses that I had was to go in with. Asset based financial institutions mm-hmm.
That were foreclosing at that time on companies that weren’t paying their loans. Mm-hmm. I would go in as the friendly buyer, hired by the bankers, turn the business around, and then have the option to either keep the business by guaranteeing the debt or spring out of the business, roll it up and sell it.
Mm-hmm. And that was my job. I did that for about 10 years and it taught me a whole lot about different businesses. Different management styles. Mm-hmm. The nature of what happens when people get into control, what are the correlation or in trouble, what are the correlations between those activities and getting in trouble.
And it helped me to guide my own businesses thereafter. And I kept a couple of those businesses, built them up, sold them, and that became a further part of my more, more specific focus into real estate. And now when we take interest in companies, it’s usually start up to just when they’re making revenue.
Mm-hmm. And we’re advising them. We take a piece, we continue to help them grow with the idea that they’re gonna sell much like venture capital. Mm-hmm. Yeah, let’s switch it up a bit here. I wanna get into the most recent volume of mission matters and let’s get into your into your content. So voices and choices, the human variable in the success equation.
Lots of different, I know, I know your content or I know some of your content I should say. And I know you got a lot lots of different angles you could have taken. Why this message? Why now? Because it really is all about people. It doesn’t matter how smart you are, unless you wanna be a sole proprietor, if you wanna build an enterprise mm-hmm.
You have to attract wonderful people, and you have to recognize who your constituents really are. Mm-hmm. It’s one thing to say, my constituents or my customers, or my clients. Or my investors, but they’re also your lenders and the building department and every other aspect of what’s happening in the ecosystem for your business.
Mm-hmm. That’s the tactical, practical on the ground today. Yeah. But the truth of how you build up to that is who’s in your life as you’re growing, who’s in your life as you’re learning who you attract yourself to, or who you attract to you. And often for me, I, I was more intrigued by people that were really smart, that knew things I didn’t, and I wanted mm-hmm.
Yeah. And I wanted to bring them close to me. And many of them I brought along with me through those companies and into my business now. But those were advisors, those were friends, family. Mm-hmm. And where do you pick up the characteristic traits? Which ones do you wanna emulate and imbu? Which ones do you wanna repel and say, well, I can see that.
Doesn’t work. Get that outta my life. Yeah, so it really is about the voices. And then the choices. So what are they saying to me? Who am I gonna listen to? Who do I need to get away from? And how am I filling in my plate so that I’ve got all the right pieces to make the machine work? Hmm. Now obviously there’s a lot in this chapter in what you wrote, but if there were just kind of like one thing that you hope your readers for your, for this takeaway from it what would that be?
Don’t be afraid of creativity. Hmm. Don’t be afraid of taking chances at all. Yeah, don’t be afraid of it. And don’t be afraid of losing. It’s not a battle, it’s a war, and it goes on and on forever. You can make it fun, you can make it exciting, but be creative, be bold, be tenacious. Have character and integrity.
Do what you say. And go after your goal and don’t listen. The more that people tell you that’s not doable. Yeah. Should be a defining moment in how you know it’s right. Yeah. Like when you’re uncomfortable. If, if it’s uncomfortable, if it’s like, it’s like, okay, then this is growth, right? Like to me, that’s the way I look at it.
I agree with you a hundred percent and, and it should be uncomfortable. Mm-hmm. And growth should be a perpetual thing throughout your life. It is for me. So that’s back to. Teaching. I learn as much from my students as I teach. Mm-hmm. From mentoring, from having juniors become seniors, become leaders, run a division, run a company.
You know, my partner was at first, my executive assistant. Mm-hmm. Mm-hmm. Anything can happen. There are no limitations except the ones we place on ourselves. It’s just, just true. Amazing. Well, Scott first off, it’s been great having you back on the show. This is exciting. I’m excited to continue to, to to promote the book with you and your team.
I have to ask, I mean, what’s next? What’s next for you? What’s next for Delray Urban? What’s next? What do you got on the agenda? Well, we’re launching funds now. We’re gonna be doing more flipping of homes in Southern California and in Houston, Texas. We’re gonna be doing more acquisitions across the country.
We’re moving into new markets. Yeah, we’re looking at multiple deals right now. When we’re out of state, our projects are typically larger. Mm-hmm. So we’re gonna continue to do that. We’ll see how things shake out in California with the regulatory environment and the pressure. California’s become a much harder place to do it, but mm-hmm.
That also deters competition and makes the good deals great. Mm. Less competition. Yeah. So we’re gonna be watching the market and see how it resettles and continue to grow. The objective right now is to double the portfolio over the next five years. Hmm. That’s great. Our goal is to exceed 10,000 units.
And to continue with the other parts of the business. Mm-hmm. And I’m also getting involved in a couple of more of the venture opportunities that are growing that are enjoyable and helping people. That goes back to the teaching and the mentoring and all of that. Mm-hmm. Plus learning new things. I’m enjoying my deep dive into AI and bringing those tools into our business because it’s so helpful, isn’t it?
Spectacular. We can analyze skills, we can with granularity mm-hmm. And all sorts of different inputs. It’s, it’s really a wonderful, wonderful tool. Yeah. And, and we just, we’re gonna keep doing what we know how to do, and in some cases go back to what we know how to do. Mm-hmm. Sometimes as we’re growing, we go on a departure and all of a sudden we look back and say, you know, we haven’t done that many deals this year because we’ve been so focused on this.
Yeah, and deals make us more money and we enjoy them and their long-term wealth creation. So there’s a balance between cash flow and wealth creation, and you’ve gotta always keep that balance, especially if you reinvest in your business all the time. Yeah. So that’s really where we’re going. We’re gonna continue to grow Amazing.
We’ll continue to grow the law firm. We’ll continue to grow the consulting firm. We’ll continue to build out these funds. And Delray Urban will continue to be a leader in these spaces for mm-hmm. Many decades to come. Scott, if people are listening or watching this and if they wanna follow up and they wanna learn more and connect, how do they do that?
Delray urban.com is one way they can do it. Mm-hmm. 3 10, 3 1 5 7 2 2 6 is the other way they can do it. Call the office if they wanna speak to me. Reach out to me. We’ll find time. Mm-hmm. And if people really want to know, how do I do this? How do I get in this business? How do I increase my space in this business?
How do I use my passive income to get a better return? How do I structure tax advantage deals? How? Whatever the questions are, we’ve either documented it when we represented banks. Mm-hmm. Lent on it as lenders bought it, litigated it there, there isn’t a piece of it that we haven’t touched, so I’d be happy to share that knowledge with with anyone.
Been doing it a long time. That’s awesome. And for everybody listening, just so you know, we’ll definitely put the links to the website, all that good stuff in the show notes, so you can just click on it and head right on over. And speaking of links as well, we’ll have the links to the most recently released book that Scott’s part of, of course, volume 11 of Mission Matters business Leaders Edition.
And so definitely pick up a copy of that. And if this, if you’re a first time viewer or listener and you haven’t done it yet, hit that subscribe or follow button. This is a daily show. Each and every day we’re bringing you new content, new ideas, and hopefully new inspiration to help you along the way on your journey as well.
So again, hit that subscribe or follow button. And Scott, man, it. Thank you so much for coming back on the show and thank you for being part of volume 11 holding up volume one Again, I cannot believe that many years have flown by and all that’s happened since then. Man, I’m just so proud and happy to see your business continuing to grow and thought and thrive, and thank you for all you do.
Thank you, Adam. I’m proud of you as well. You’ve done an incredible job. I love working with you and we’ve got a lot more to do. We’ve got a lot more to do.
