Building a Legacy with Craig Evans Part 1 #963

In this episode, Joey Romero speaks with Craig Evans, CEO of DBL Capital and The Norris Group, about the values driving the company's mission to create affordable housing while protecting investor capital. They discuss workforce housing, market resilience, leadership through challenging times, and how DBL Capital's integrated approach delivers long-term value for investors and homebuyers alike.

 In this episode: 

• The meaning behind DBL Capital and how faith, family, and legacy influence Craig Evans' leadership. 
• Why stewardship and serving others are central to the company's business philosophy. 
• The growing affordable housing shortage and why workforce housing is DBL Capital's primary investment focus. 
• How infill construction creates opportunities that many institutional investors overlook. 
• The advantages of owning an integrated homebuilding and mortgage platform. 
• Lessons learned from navigating COVID-19 disruptions, supply chain challenges, and multiple Florida hurricanes. 
• How strong relationships with trade partners helped the company overcome difficult market conditions. 
• Why affordable housing has remained resilient through changing real estate cycles. 
• How DBL Capital's fund structure provides flexibility, multiple exit strategies, and added protection for investors. 
• The role of tax strategies, depreciation, and long-term planning in maximizing investor value. 

 Learn more about DBL Capital: 👉 https://dblcapital.com/opportunity 

The Norris Group originates and services loans in California and Florida under California DRE License 01219911, Florida Mortgage Lender License 1577, and NMLS License 1623669. For more information on hard money lending, go to www.thenorrisgroup.com and click the Hard Money tab.

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(Transcribed by TurboScribe. Go Unlimited to remove this message.) State podcast, a show committed to bringing you insights from thought leaders shaping the real estate industry. In each episode, we'll dive into conversations with industry experts and local insiders, all aimed at helping you thrive in an ever changing real estate market, continuing the legacy that Bruce Norris created, sharing valuable knowledge and empowering you on your real estate journey. Whether you're a seasoned pro or newcomer. This is your go to source for insider tips, market trends and success strategies. All right, welcome everybody to the Norris group real estate podcast, we have a special familiar guests sort of. So today we have as our guest is Craig Evans, CEO of not only the Norris group, but today he's here as CEO of DBL capital, because there's some exciting things happening in the fund. And we just wanted to highlight it kind of, you know, we're just throwing this around and like, man, that was a really good meeting we had a couple weeks ago with the investors. We had a private private dinner and some great conversations and just some things even that I didn't know was happening. So it was really cool. So but before we get into what the fund's doing, Greg, how you doing today? Good, man. Very good. It's good to see you. You know, it's been very busy with my family and everything going on. But it is good to sit down and chat with you today. Sorry. So now, the first thing first word out of your mouth is family. So actually, DBL capital and everything you do is framed around family. Tell me why that's so important to you. Well, you know, a lot of people don't really understand where what the DBL stands for. And it's Douglas Brooke legacy. And so Douglas is actually my middle name. Brooke is my wife's middle name. And legacy is all about the legacy we leave behind. You know, we can we can make money, we can do a lot of things. But to me, the important thing is what what legacy do we really leave in this world? And that's that's my big goal as we're working through and developing the companies that we do is how do we leave this world behind us? So that means a lot to me. Now, one of the things is that, and a lot of people kind of not that they hide it, or they just, you know, they wait until it's a comfortable setting. But not for you, faith, faith plays a big part of you in your personal life. And you don't shy away from it in business. So can you talk about that a little bit? Yeah, you know, Joe, we talked about this a little bit before the meeting out in California. You know, I've actually had some friends that tell me, hey, you need to tone back your your rhetoric and this talking about your faith, you know, and I actually started to consider and think about that. And I just was ready to, you know, I was disappointed in myself that I was even willing to consider that, you know. And so you know, that at the last event, you know, I, as always, I'm unashamed about it, I'm gonna, I'm gonna talk about what I believe. I mean, my faith means more to me than anything. I know, the life that can be pushed on us, and the challenges that can come and I know, without my faith in Jesus Christ, I know I'm in a rough spot, you know, and, and we talked about it a little bit that night, everything I do really bases on or spins off of three, three priorities, I really try to focus on what's the priorities in life. And my number one priority is always and always will be my faith in Jesus Christ. You know, how do I live my life? I don't beat people over the head with it. But but I really work hard and try to live the life of saying, you know, God, help me to be a better man tomorrow than I am today. How do I make better decisions and live a life that pleases God more than what I did yesterday. My second priority is always and always will be my wife, Stephanie, again, Stephanie Brooke. She's the Brooke of Douglas Brooke with you know, my wife is always my second priority. I love my children, but my wife will always be my highest priority above my children. I chose her first and she chose me. But then my third priority is my children. You know, I've got Georgia and Addison, you know them both well. And I love my girls. I'm so proud of seeing what they do. And the Georgia's in college in North Carolina and, you know, working on her music degree. Addison has just graduated from high school about to start at USF and her business degree, looking at finance. She's looking at coming on with us. I'm super excited about my family. But, you know, Joey, the thing that that people talk to me about and ask me, you know, like when I talk about these things, they say, well, you didn't talk about your business. My business isn't my legacy. You know, the business isn't who I am. That doesn't just that doesn't determine who I am as a man and what I leave behind. Those are just tools that I believe God gives us to to be a steward within this world. My what I've been given stewardship over is my wife and my family to be able to try to lead the best I can with all my faults and failures as an individual to still try to be a leader that makes them proud and that makes other people proud of the legacy we're trying to leave. Well, a lot of those qualities translate when you're talking about being the CEO of somebody of something you're talking about being the fund manager and taking those that stewardship, you know, that core belief that you have in being a steward for other people and being of service where, you know, you're you're like a dog on a bone, just protecting that that equity, protecting people's money and protecting their legacy that they're trying to build. Well, and, you know, several people have asked me, you know, what is my number one thing that I strive for in business? And, you know, every business has a different value as far as what are we trying to achieve? You know, as a fund manager, obviously, you know, I've got a goal of trying to deliver fantastic value to our investors, to deliver safety to our investors, protect their equity, all of those processes as a builder, you know, we've got to be a good operator and build timely and build quality product, you know, all of those aspects. But at the end of the day, you know, when I turn around and I look and I say, you know, really what what makes us as a company, it's how well do we serve others, you know, and for me as a CEO, I'm not the one building the house, right? I'm not the one doing all the things. So for me as a CEO, really, I have to look at it and how do I serve those that that choose to work for us and work with us? How do I serve them? And I believe that the better the more I can be a servant to other people, that helps in that aspect of me being able to provide that and then as a company, we are better servants to others and produce better products. One of the biggest talking points in the country right now is affordability and, and the crisis that that we're going through as a country is and people just not being able to afford homes. You cite in your presentation that there's 21 million families that are spending more than half of their income on housing, and that there's 7 million, there's a shortfall of 7 million homes in that price point of affordability and affordable, affordable homes. So walk us through why workforce housing is not just as the opportunity for you, but just not just as an opportunity, it's like the one that you're going to focus on and, and everything that that DBL Capital's focusing on right now. Well, to me, it's where to where, again, where do I place my values, you know, and, you know, I think a lot of that goes back to my history, you know, I, Joey, I've built a lot of, I've bought, I've been a part of building a lot of big structures and a lot of expensive buildings and expensive homes and, and those are all, you know, they're good egos that they're fun to brag about. And, you know, the attaboy you pat yourself on the back, because, wow, I did that. But at the end of the day, most of that's just a dollar sign to somebody else. I, part of why we look at the the affordable housing is, you know, as a builder, when we get Christmas cards at Christmastime of people that have just been able to come out of an apartment and have their first Christmas in their own house. That's a big thing for us. You know, we love when we get those. Do we get them every day? No, listen, I mean, we don't sit around and sing Kumbaya on, you know, this is work and people have lives to live. But the knowledge of knowing that we're providing a product that is so needed, because of the affordable nature in our in our country right now, you know, you mentioned it and it's on some of our data and stuff. You know, there's about 84 million families. Well, over 21 million of those are spending 50% of their revenue, their annual revenue, over 50% of their revenue is going to pay for housing. It's no wonder that families are living week to week, trying to figure out how to make it through when 25% of the country is saying, hey, we're spending over half of what we make just to have a roof over our head. I think we can do better than that. I think we can be better than that. And it takes effort. It's hard work to work the pricing like you have to do. It's hard work to, to beat the times and to operate on the schedules that we attempt to work off of. And it is a lot of work to do that. But I think there's great value in that. I think, you know, you asked me, why did I choose this as a fund for our fund? You know, there's a lot of class A projects, there's a lot of high end, you know, luxury product that we could go build. And maybe we get a better yield if we hit right, you know. But there's a couple things there. One is if you look back through history, affordability and affordable housing has always, always been a seller. There's always a buyer that needs affordable housing. That's not going out of style anytime soon. You know, I mean, let's look at what's happened over 24 and 25. You know, we reached appreciation in this country and appreciation levels to where the markets just couldn't sustain that even at middle price points and higher end price points. And we've had in some markets, you know, 10, 12, even more percent of price damage, right? On some of those higher end stuff, when you look at where affordable housing is, we've had appreciation, but we really haven't lost back in that. So affordability sustains, typically sustains its pricing model. You know, as long as the neighborhoods that you're building in and everything, as long as they're sustaining in their schools, as long as the crime models not getting out of control and going crazy, it's a process that affordability is always a winner. So that's really why we look at it. We look at it from one, from a dollar and cents perspective, it's always a winner. Two, it's a thing that is needed so badly in our country. And quite frankly, it's a lot more fun to see the smile on somebody's face when they know they've just gotten their first. So you call the infill construction messy and slow to scale. Why does that scare off the big players? And but how does it actually work for you? Yeah, you know, I'm, let's say I'm over 35 years of history in construction, and most of my residential experience has been all infill. And, you know, the difference between infill and and, you know, community development and construction. Community development is a lot easier to build in, you can scale at that. Now the timing on that can take play, you know, or take, you know, to have an aspect of how you deal with that, from a turn of capital, but because you can have a year and a half, two years of pre development before you ever get to start breaking ground and going vertical, you know, and starting to build vertical on the homes. So there's a cost factor there that you got to take into play. You know, obviously, as our fund continues to grow, and the cash flow, the fund allows that we will start to develop in communities as well. But from the aspect of under, if you really understand how to build infill, it is a niche that most institutional level funds don't look at, because it is exactly that it's messy, you got to know what you're looking for, you got to know how to manage through entitlements, you got to know how to manage through permitting. And it takes an expertise and a knowledge that most companies just don't have. There's been a few that's been somewhat successful in it. But it is it is a harder process to manage. And so that's why a lot of builders really prefer going and building in a community because it's just easier. So most funds are going to go and try to acquire existing assets, you know, existing companies, existing buildings, existing apartments, you're building from the ground up, and you're affecting the shortage by doing so. But how does what does that distinction matter with your returns? Oh, well, the biggest aspect is one, you're you're able to get a brand new product with virtually no capex needed for the next, let's call it five to seven years, right. But the biggest aspect in doing that, we now get that at a truly wholesale rate. You know, most companies, when they're buying, they're just what, you know, Douglas Brook, our home builder has been approached by several institutional funds to build. And, and in that aspect, you know, what they are willing to pay is typically is a higher number than than what we than what Douglas Brook or within what DBL pays Douglas Brook homes. Now, we do that specifically for a reason. And we've kind of geared ourselves to where, you know, for the most part, Douglas Brook homes, our home builder only builds for DBL capital. Now, we have a few investors that we build for on a private side. But for the most part, Douglas Brook homes only builds for DBL capital, you know, so. So in that aspect, we're able to manage through those costs. We don't subsidize the cost DBL, Douglas Brook homes still has to stand on its own. But but in managing through the numbers of that, you know, we're able to deliver a lower cost product by staying streamlined and running lean. And again, knowing the markets, right, if we try to go go into markets too quickly, and don't understand the market, we've, we've had scenarios where that didn't work well, you know, and so that's some of the things I've had to learn through life is, you know, you've really got to understand your markets before you start trying to go horizontal and vertical. One of the newest and a lot of people don't know about this in your vertical stack is is kind of be your secret weapon is DBL home mortgage. How does that create an advantage, you know, when you're going to exit some of these affordable homes? Yeah, so DBL home mortgage, we are we are super excited about that that is going that's a been a great model for us. And in that when we're able to offer rates that other people can't, before buy downs, anything like that, you know, now we're able to come in and, and literally help people buy their houses. For instance, last Wednesday, we had a young man that was moving down from Jacksonville, needed a house looking to buy a house. And, you know, we said, Well, listen, if you're going in and use our mortgage company, DBL home mortgage, if you use our mortgage company, we can get you things that others can't, we're able to help you with some concessions, some closing costs, things like that. So we started working through. And what we started seeing was, you know, he he made plenty of money, on and on and on. But his debt to income was still affected because he had some debts out there, that really, he could affect pretty quickly, just because he had some cash laying around. So not only were we able by far, beating the every rate he was getting by over half a point. I mean, we were beating everybody's rates that he was seeing so far over half a point, which allowed us then to be able to say, Okay, now we can work in and do more concessions for him, which helped him get into the house. And on top of that, our our processors, our agents that are working on the loan closings, were able to help him work through his debt scenario to clean up some of the debt that actually even got him down almost another full quarter of a point than what we'd originally quoted. So having that in our pocket was really has been extremely beneficial at being able to get product moving and making sure that we can always provide the best product at the best price. And that's a lot of what we're trying to do is when we talk about affordability, the price may be good, but if the person can't afford the monthly payment, that's that's the problem. So you've done over 100 million projects in projects through multiple market cycles, even you you were a builder through through Ian, and then, you know, you continue building after that. What is what has been the one thing over your your career of building that has tested your model the most? I would say without a shadow of a doubt, those two years back to back years of Ian, and then right after that Helene and Milton. Those two years were some of the most trying years that I've ever seen as a builder. You know, and especially because we're, we're, our headquarters is down in southwest Florida. At that time, we were spread into four markets, we were in two states. And we got pounded in both states by both storms. It was a rough, rough time to be a company the size that we are, right? We're not a Lenore, we're not a Dr. Horton. So as a company this for our size, which we were growing extremely fast, you know, 2022, we were listed as the 10th fastest growing contractor in the entire country. And that's got its own ups and downs and challenges and everything. But with that growth that happened right at the time that that Ian hit, and then Helene and Milton hit the next year. And we went from where, you know, one of the fastest growing contractors in the country to now nobody can get blocked. Nobody can get trusses. Nobody can get anything. You know, we go from I'm getting trusses in three days to now I'm getting trusses in 12 to 14 months. You know, that was that was coming on the heels of all the disruption from COVID. All of that came through, you know. And you know, there's a lot of sectors in the in the country where, you know, everything is stick build where it's all wood frame, you know, wood frame construction. And because of the wind borne storms and things that we get down in Southwest Florida, you know, most everything here is built out of concrete block, you know, and it's the cells have steel in them, and they're poured with cement and, and it was down to so many things transpiring that we couldn't even get the fly ash to make for the plants to make concrete coming out of COVID. So that's one of the things that slowed it down. So obviously, the costs were an animal at that point that that everybody was dealing with. But, but in the process of our cycle times and budgeting that, you know, we were a very fast builder pre COVID, extremely fast. You know, we went to after COVID, we were 12 to 13 months, where but for us, that was just demoralizing. But, you know, we would also then turn around and look and say, Okay, well, hey, we got national builders that are building in 21 months. So we were still delivering far below where where other builders were delivering at the time. So while it was one of the most difficult times ever to build through, it was a time that I'm proud to say we built through it was the time that we survived through that, you know, Joe, you know, me and my dad are like, we're like best friends. I love my father, you know, and I never forget, I was taking my dad to lunch one day. And he just looked at me, he said, Greg, he said, you know, I've been building since I was 18 years old. You know, he's 82 this year. So at that time, he would have been 78 79. And he's literally looking at me says, if I had to go through anything like you guys are going through right now, he said, I'd have never been in this business. It was just insane. It was crazy. But at the same time, Joe, I'm grateful, because when you go through hard times, you figure out who you are, and you start knowing what you can achieve. And so as hard as those years were going through those two storms, not just what it did physically to the people that work for us and their homes, and your communities and seeing what people have to deal with. But how do you then keep a business flowing? When you've got, you know, investors to respond to when you've got developers to respond to when you've got trade partners to respond to. And then when you've got the people that come in your office every day that are working for you, and they're saying, Hey, we want to produce all this, but I haven't had power in three weeks. You know that those were tough times to work through. But man, I'm glad that we, as we've come through that we know who we are. Well, and that's one of the things that people don't understand, they see a Lennar. And they're like, Oh, well, they just handle everything from A to Z. They see this. So they think every builders like that, you know, you're talking about over 150, you know, trade partners that you have to deal with to make all this magic happen, right. And, and as we were talking about this before, that could be a double edged sword. You know, sometimes the there's some trade partners that you got to be a little tough on. And then sometimes the trade partners that will absolutely lift you up, right? Yeah, we, you know, the the 24 and 25, I would look at and say, while while the times of let's call it 2020, when COVID hit up through about 23, when we're coming out of all the storms and the hurricanes and everything that happened, those were extremely hard times, right. But those were hard times just as as people and because you're trying to figure out how this is working in life, right? Because there's so many nuances that were new to the world, right? There was things that had never really happened before. Then all of a sudden, you get into 24 and 25, and especially the 25. And let's face it, I mean, we're talking about the real estate market did things comparable to 2008. Now, not as bad, but you know, we had price damages in some markets of the country, 12 and 14%. You know, those were price damages that nobody saw coming, you know, 22 and 23. While it wasn't hot, like it was in 21 and 22, the market was still very, it was still somewhat climbing and, and just an easy, steady climb, if not plateauing a little bit. I don't think anyone saw what happened starting in 2024, when the uncertainty of the markets due to inflation and it was happening so quickly, there was so many, so many markets and so many sections of the market, they just really didn't know how to read that. So in that process, you had a lot of trades, you know, different skill sets, that were just grabbing work wherever they can grab. And all of a sudden, you're going from a trade that shows up for you every day to now all of a sudden, they're telling you, hey, we'll be there when we can, but they've already started your jobs. And while they're the contractor of record, and you're trying to work through that, because you'd have longer to change a contractor of record than you would to work it out and work through it with them. But yet the one you'd worked it out with had already gone and grabbed 20 other jobs. And, and they were just starting them all to get them on the books. Now, the flip side of that is, you know, so obviously, we had some trades that were were, and that's a part of construction. But we had some trades during that time, that were could have been a detriment to us, you know, to a lot of builders, it would have been a detriment to. But on the flip side of that, we have a lot of trades that looked at it and said, wait a minute, we're all in this together. Let's figure out how to work through these trying times, right. And a lot of them have come back with, with pricing, with better service models, with things that said, hey, we want to be a part of the success of these companies, like Douglasbrook homes and DBO capital, they understand what they're we're trying to achieve. And quite frankly, they all know our model of what we're looking at as affordable housing. And that's why we have a lot of the trades that we have right now, is because they are passionate and love the fact of what we're building, just like we are. So let's talk about that a little bit where things are in 2026. We've already talked about how 25 was really tough. But now you did build some homes. And, and it's interesting that some of them you sold and some of them you kept. And so how did that, you know, how did you, you know, make that pivot on the fly? And and how did that work out for the fund and the investors in the fund? Yeah. So in that process, you know, I will say this, but in answering that question, a lot of the reason not a lot, the main reason that we ended 2025 and came in at 26, like we did, is because of the structure that we set up within the fund. So when you read our PPM, when you read our fund docs, and you read our operating agreement, you know, a lot of people look at it, it's just it's 120 pages or so on a PPM, and it's riveting. It's Yeah, it's some of the it's some of the best I always tell people it's some of the best bathroom reading you'll ever have, you know, but it's in that process. You know, we spent a lot of time developing how the fund will operate. And I was very intentional about that, because there's a lot of companies that when they start their fund, that they're just running out, and they just want to get it going as fast as possible. So they get their docs put together, they don't spend a lot of time at really looking at what is the docs going to do for how you operate? Because in a fund, everything is based on how what are your fund docs say, we have to go off that, right. So so in that process, setting up our structure, the way we've structured it provides a lot of security and protection for the investors. But it also it does that because it gives me as the fund manager, a lot of options of how I can move through and protect people by, I can choose, you know, I've got multiple exit strategies, I've got multiple hold strategies available to us because of the way we wrote the docs, I've got a lot of limitations put on me. So I can't just go off and do anything we want. So in that it really allowed me and started saying, Wait a minute, because of how our fund is set up, we can structure this to be available for 1031 exchanges. So in doing that, holding them and now selling a lot of these off that we've chosen to hold into the 1031 market has been a very valuable process for for the fund. And it's providing a great source of doors, if you want to call it, you know, for for people that need to do 1031. You know, so it's and it's giving them good cap rates. So in doing that, that's really I base all of that all back to the structure of the fund and how we set it up. Well, and the one thing that that people don't understand is that the way the the fund docs are set up in the way you've set up, you were able to get some massive depreciation. Because, you know, everybody talks about the best way to do that is to, you know, cost segregate. Well, because you're a builder.