A personal message from Sunny Dharod:
First off, I’d like to thank the people who have helped me to grow and be in the position I’m in today: My dad, Harshad, for his undying support for myself and so many others around him to chase their dreams and to ALWAYS think BIGGER; my little brother, Shan, who’s inspired me to push myself to be better and reach new heights in so many different aspects of my life; and to my hero, Kobe Bryant, who’s Mamba Mentality has given me a blueprint to structure my life around so that when things are going good or bad, I have a reason to keep pushing forward. Also, a big thank you to Joe Leon, who helped our company take a step into a different stratosphere.
Known for his inquisitive mindset and friendly disposition, Sunny Dharod is driven to produce returns for his investors through the investment vehicle he and his family have created. As principal of Silver Star Real Estate, he sources deals, secures financing, establishes renovation plans, and projects each property’s current appraisal and estimated exit value. Friends, family, banks, partners, and institutions are then offered the option of investing in the real estate opportunities through his company—a private family office with properties located throughout central and Southern California as well as Arizona. Since its founding in 2006, Silver Star Real Estate has acquired nearly 50 properties valued at $600 million. Since assuming the role of principal and acquisitions lead in 2015, Sunny has continued expanding its portfolio, driving $300 million in acquisitions over 20 different properties. He is also responsible for dispositions and the portfolio’s daily operations.
We recently met with Sunny to learn more about his real estate journey, accomplishments, and plans for the future.
How did Silver Star Real Estate come to be?
In the late 1970s, my dad came from India to California, and the first job he found was working in a fast-food restaurant. He got a job at Jack In the Box and over time, he worked his way up and ultimately bought his own franchise. From there, he learned the system, worked smart, and eventually built up to a portfolio of about 20 stores in the late 90’s. By 2000, he had sold the JIBs and purchased a franchise of 70 underperforming Carl’s Jr. restaurants. In 2001, by implementing some of the things he had learned at JIB, such as opening 24 hours, he was able to boost AUV from $1.1MM to $1.7MM per store. This led to lots of cash sitting at our banks, achieving very low returns. Eventually, by 2006, we made the decision to invest the excess cashflow from the restaurant holdings into apartment buildings, thus the beginning of Silver Star. We get a healthy profit from the franchise and can add more cash by refinancing, which we roll into more real estate. Since the company has grown a lot in recent years, we now offer investment options for other people to use as a vehicle to increase their wealth as well.
Is the company still in expansion mode today?
Definitely. For the past couple of years, we’ve been working with institutional partners and other private family offices to build our portfolio. We currently buy one to two institutional buildings per year and are projected to grow fivefold with partners in the near future.
What kinds of services do you provide your clients, and how do you add value?
Our tenants are the most important people we serve, and our mission is to make their lives better by improving their homes and communities. We provide great value for our institutional partners as well—much more than just returns. For example, we own all of our buildings, so we have skin in the game. We manage almost everything in-house because management companies never take care of properties the same way the owners do. We also bring operational expertise with which few other companies can compete. Compared to the restaurant industry, real estate is a lot simpler—we renovate, fix things, and collect rent. The key is to be organized and to have good managers in place to take care of the tenants. The restaurant business has taught us how to keep our fingers on the pulse of every building, and that’s how our institutional partners benefit—in addition to receiving a great ROI.
Tell us more about the institutional partners you work with.
One of our partners is The Related Companies. They are currently developing the Hudson Yards, a $25 billion project in NY. The owner of the company submitted a proposal to build a platform above the city’s 30 acres of train tracks and it was accepted. So, Related is now building skyscrapers, office parks, and art structures comparable to the Eiffel Tower. They’re really amazing. We’re managing and renovating a property for them now on Long Beach—a $78 million deal and the largest thus far in our company history. The goal is for Related to make back 135% of their investment.
Who have been your biggest sources of inspiration?
My dad has an incredible mind that I’m tapping into every chance I get, not only has he been a great example and educator, but he has also given me access to many other great minds and resources as well. The vast network of people I have been able to learn from, my uncle, principals of other very prominent businesses, high level brokers and lenders, prestigious institutional partners, and many other interesting people I’ve met through my own work. Just observing and conversing with them has taught me so much about who I want to become—a role model for my brother, sister, and nephews, just like my dad was for me.
Kobe Bryant is another person who inspired me. He was my neighbor and I would many times hear all these great stories about the things he did for others and see him at the community center coaching his daughter and her team. Even though we didn’t personally know one another, the way he treated me whenever I ran into him left its mark on me; he was much more than a basketball player. Kobe taught me that no matter who you are or what you do, true character is what’s most important.
Do you have a motto or philosophy that you live by?
This quote, a Kobe quote, has inspired me to keep going no matter what the circumstances: "What I'm most proud of isn’t the championships but about the down years, because we didn't run—we played through all that stuff.”
You’ve already accomplished a lot, so what do you have envisioned for the future?
What I’ve achieved so far is just the beginning. As a result of my father’s hard work and success I have been given numerous advantages—but instead taking these things for granted, I take pride in my work ethic and in my ability to make the most out of what I’ve been given, when it’s all said and done, I want them to say, “He didn’t waste too much time and he didn’t get bogged down with things that didn’t matter. He stayed focused and did everything he could with what he was given.” My number one focus right now is keep my head down and stay focused and methodical and see where I can take this thing, I’m excited to see where the chips land.
Silver Star Real Estate