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Jan. 14, 2021

Al Keith on buying and renovating his River Heights home

Al Keith on buying and renovating his River Heights home

Al Keith is a kitchen and home renovation expert with TENTEN Kitchens & Contracting. In this episode we talk about his own journey of recently purchasing a 100+ year old River Heights home, renovating it and then reaping the benefits of $160,000 equity g...


Al Keith is a kitchen and home renovation expert with TENTEN Kitchens & Contracting. In this episode we talk about his own journey of recently purchasing a 100+ year old River Heights home, renovating it and then reaping the benefits of $160,000 equity growth.

Transcript

Adrian:

All right. Well, I'm joined today by Al Keith of TENTEN Kitchens & Contracting. I have a personal connection to Al and his business. They actually did some work at our home, which we are still in love with. And Al's got an interesting story that I'm so happy he's going to be sharing with us today. But before we get into your story, Al, obviously you're a self-employed guy, you work on real estate, just the virtue of your business. How has the pandemic affected your business?

Al:

The pandemic is, strange but true, the pandemic's been very good for our business. There's lots of people who have been sitting on real estate that is under-improved, and that through the time they've spent staring at their walls and wishing it looked differently, they've decided to pick up the phone, give us a call and make quality improvements to their homes. So it's actually, I hate to admit it, but the pandemic's been, interesting enough, good for us.

Adrian:

And have you been able to have the manpower and the resources to do the projects that have come as opportunities to your business?

Al:

Yeah. There are definitely limitations on things like manpower and how many people we can have in a project at a time. And we have to take all the safety precautions. The reality is that certain things take more time to get right now than they would ordinarily. Business is not completely as usual, but it's a little bit slower in terms of how long it takes us to build, but it's moving along. So we're crossing our fingers and continuing to build beautiful kitchens for wonderful people.

Adrian:

That's good to hear. I looked at your website this morning to re-familiarize myself with your business. And right on the front, there's pictures of obviously your raving fans, people saying how they love their TENTEN kitchens. So I couldn't be happier to have you on the call on the I Love Winnipeg Real Estate podcast. So let's talk about your story. You recently bought a new or perhaps old home. Tell us a little bit about the home that you bought.

Al:

We're excited. So this is a home that we plan to live in for at least 10 years, so it is our family's home. But we had been looking for a home that would suit our talents, that we could move into, make some improvements to, and potentially improve our financial position at the same time. And we'd pretty much given up on that one. Trudy Turner, our real estate agent, introduced us to the home we're in now, right on Oxford. It's 105 years old and it had been ... I'm going to say, loved but significantly under improved. Which means that the original doors, the original door handles, all the original character wood was here. So it had fabulous bones and we loved it and we did the math on it a few times and thought, it's just too much work. But when we looked at it, we decided, no, we love this. We want this to be our home and we want to make it our own. And at the same time, we think at the end of the day we could potentially see a gain from the money we put into it.

Adrian:

So, given that our podcast has the word love in it, let's get intimate for a minute. Could you tell me the purchase price of the home?

Al:

Yeah. We bought this house for $455,000, which felt like a steal for the fact that we bought a home that's over 4,000 square feet, on a very desirable street. We're in Oxford, in River Heights between Kingsway and Academy. It's a great lot. We have a 60 foot lot, but maintenance has been limited in terms of things that have been done. And I think people were scared to get into it. There's a lot of catch up to do, but the home was loved previously and we love the history of the home. It's been owned by lawyers and judges since it was built, and it was built by a prominent Winnipegger 105 years ago. So we loved the character of it, we absolutely fell in love with it, but we're scared by the size of the checks we'd be writing to improve it. But our story actually looks really good right now. So we're pleased to find out that we're moving in the right direction with it.

Adrian:

We'll hopefully get into that in a bit. Now you said 105, so was it built in 1915?

Al:

1914.

Adrian:

  1. Okay. Did you have any fears about buying this home and perhaps were you aware of the risks that came with it?

Al:

Yeah. One of the issues that we find with old homes is that things typically cost more money than you think they should and that problems that look like an issue on the surface are frequently deeper. So we were scared about structural issues and we looked at it and made an assessment, had a home inspection. I'm in the business, but I wanted to be sure I wasn't looking at this house with rose colored glasses. So we brought in an outside expert recommended by Trudy Turner, who did a fabulous job of going through the home, gave us 55 pages of issues with the home. Lots of them small, but certainly some of them were absolutely significant.

Adrian:

And what renovations did you make to the home?

Al:

Well, initially we knew that we had to upgrade all of the electrical. It had knob and tube wiring throughout it. Some of it had been improved, some of it very well and some of it perhaps not as well. So it cost us about $40,000 to do the knob and tube. We initially got a quote for $25,000, but then when we did the major kitchen renovation with it, that added more electrical costs to it. So the reality was that we got a very big bill and there was a bit of a surprise in the size of the electrical bill. But we've chased out every bit of knob and tube, which as I understand is a little bit exceptional. Even though our insurance agent would have been happy if we chased out about 90% of the knob and tube, but we managed to tear up everything. Which left us with a home full of holes in the walls, all over the place. But at the end of the day, it was the first thing we knew we had to do to build back the base of the house that we wanted to build on top of.

Adrian:

Now, you're a pretty calm guy. Did you and your family live in the home while all this was going on?

Al:

Yeah, this was a significant burden. And Barb, my wife, still loves me, but there were times when I wasn't sure she would. We literally plasticked off part of the house and lived in eight out of the ... part of the living room while the renovations were going on, because we tore out the remains of two sets of butler stairs that were in the home to expand the kitchen. And there was significant dust. This went on for a long time. And what Barb told me, what she really wanted for Christmas last year was running water in the kitchen. So we got her her Christmas present and Christmas was saved. But when we got the kitchen working again, life became a lot better in the home. But for a while there, with all the baseline work with renovating, carrying out plaster and lath, ceilings that were falling down, structure work that needed to be done, there was a lot of dust, there was a lot of debris. There was definitely some tears, but we're very happy with what we've done.

Adrian:

What other major things have you done to the home so far?

Al:

The kitchen was the big thing. Now, we're in the business of interior renewal. So we do rate homes full insides, rate basements, kitchens. We will do bathrooms and stuff, but we typically do them along with kitchens. People regularly phone us and tell us they want to do the whole inside, two bathrooms, the whole main floor, everything. So we knew what we were in for with this house. And we knew when we built the kitchen, we wanted to build a stunning kitchen because we really like kitchens. Now, it's hard for Barb and I to agree on what something will look like and I think that we have this tension that comes out positively in the end because we challenge each other on what this can be. And so for months, I drew pictures of what the kitchen should look like and Barb was doing the same thing.

Al:

And at the end of the day, we agreed on what we thought was what our opinion, stunning kitchen that absolutely fit the character of 106 year old home. And it's gorgeous. It's beautiful. We've done some fabulous stonework. We challenged people to do their very best work on this and we asked them with respect to ogee curves on the edge of the stone and pattern layouts and things like that, that they don't usually do. And at the end of the day, when they carried in the island slab of granite, it took six people and it weighs about 875 pounds because it's over two inches thick. So anyway, we think it fits the character of the home. In my opinion, it's gorgeous and the feedback we get from everybody who sees it is that the kitchen is stunning.

Adrian:

And after all of the work that you did, did you tally it up and take a look at the bottom line, what you've spent so far?

Al:

I think we're fairly careful with that. And we were curious because we were putting more money into it than we were initially hoping to put into things, but we allowed for that in the process. So yeah, we've kept a bit of a tally. But then, we looked at things and there was a certain level of uncertainty with what's going on in the world today.

Adrian:

Mm-hmm (affirmative).

Al:

And we decided, you know what, we should get the home reappraised. We would like to continue to do improvements to it, but we want to be sure we're being smart with it. So we might've phoned our friends at Cambrian Credit Union, and they sent out an appraiser who reappraised the home for us. And we're very pleased with what he came up with. He did a very good job of going through the home. He also recognized the value of true character improvements. We paid $2,000 to have crown moldings and original baseboards remade out of real wood for the home. We recognized when we bought the house that we thought there was a depth to the character in it that we needed to make sure things were maintained, the original integrity of the home.

Al:

So even while we opened up the kitchen and stuff significantly, we still wanted to maintain all the original moldings that had been there and nobody had molested them in 106 years or whatever. So we did that. And the guy who did the appraisal recognized that we'd taken design inspiration for the kitchen, right from the stunning fireplace mantle that we fell in love with. And we joked that we paid half a million dollars for it when we bought the house. This is all Trudy Turner's fault, we blame her for this. But yeah, we love the house and we are delighted with how it's going. We love Winnipeg Real Estate.

Adrian:

So you bought the home, you have made significant improvements to it, you had the home reappraised, what's your upside so far? How are things looking as to your equity growth or your win?

Al:

Yeah. It's come up really good and we're delighted, as I said, with it. So we paid 455,000, we put, we think 175,000 in, and then we recently had it appraised at 790,000. And so we've got a gain currently of 160,000. And the appraiser went further than that and said that with the improvements we're looking at, we've still got two bathrooms we want to renovate and that he thinks that there's a further $200,000 just based on the market today.

Adrian:

Now, did you and your wife do all the work yourselves or was good portions of it outsourced?

Al:

Certainly the plumbing and electrical was outsourced. And I have people who I work with who came in and did things like painting. And we had to work this out with our accountant as to how actually this would work. And yeah, so that's part of what I've put in. But I may be underestimating how much sweat equity I've personally put into the home in working on it. It's not unusual that on Saturday afternoon I'll pick up my tools and do four hours worth of work on the house, checking off things off of the original list of to dos.

Adrian:

But you got Barb her running water for Christmas.

Al:

Yeah. So apparently I never have to buy her anything for Christmas ever again.

Adrian:

And based on what you've told me, $160,000 in equity growth, along with running water, I think that's a pretty big annual gift. How long did this go over? What's the timeframe?

Al:

Our timeline is slightly screwy because of the pandemic, but this really is almost a year and a half that it took us to reach this point. But the reality is that when COVID struck, we had a moratorium on spending on the house. So we literally decided, until we really knew what was happening, that we would not spend more money on the house. So we did that for a while. Yeah, so things got parked for a little bit. And then when we realized that the business was good, we were deemed essential. And moving forward, subsequently we've just been so busy that it's difficult to get a spare day with somebody, like some of the fabulous craftsman we work with, to come into our house and do a little bit of work.

Adrian:

So based on your experience of what you've done with your own home, obviously you provide some or many of these services that you provided to yourself to others through your business, TENTEN Kitchens. Can you tell me a little bit more about your business and perhaps what makes your company different from others that are also in the kitchen and contracting business?

Al:

Sure. We love our business. We started this business about 14 years ago and we put a lot of thought right into ... initially it was just me and my wife. Barb was added to it at some point after we started. But we love the idea of improving things, we love real estate and we love the fact that we can take something that ... a kitchen that's well past its best before date and turn it into a home that's stunning, that is the backdrops for people's lives. That it absolutely improves people's life, not just their home. So we regularly, we're in there when demo starts and you see what the kitchen, what the home looks like before. And then as we're walking out the door, I exaggerate this only slightly, but we can sometimes be in tears because we've loved this home, we've invested in this home.

Al:

We have fabulous Red Seal carpenters and Red Seal cabinetmakers who work on homes. We hire people who are top 5% of their trade. And that at the end of the day, with the work that they've done, we're leaving people with these stunningly beautiful homes that absolutely improve every day of their lives. I'll tell you a story quickly about my last home. That when I used to get up in the middle of the night, I'd walk by the kitchen right on the way to the bathroom. And I used to get up in the middle of the night, do my business and I'd think, every time I walked by, that's an absolutely fabulous kitchen. And it just injected me with pride and appreciation for the work that I do and that it made having a beautiful home, improves your life, not just your real estate equity.

Al:

And I think in Winnipeg, we can absolutely do both. You can improve your life and build the space you want to live in and see a fabulous return on it. Because it's not just the 7%, we've seen people have stunning returns. We've seen about three homes in the last couple of years, where we've redone their interior and the return on it ... I couldn't tell you dollar for dollar what it is, but what I get back from the homeowners is that their returns have been exceptional.

Adrian:

I can speak to that from personal experience when you did the work at our home. You did the kitchen, you did a bath and some other significant improvements. And I know, even for insurance purposes when it was appraised, our wins were unbelievable. So I think it just echoes what you're describing that you can invest in your home, which improves your family, your life. And because we're in Winnipeg, grow that equity and that home. So I think you answered my next question of why you love Winnipeg Real Estate right there. You summed up wonderfully. I guess what I'm curious about is, no matter how beautiful a home is, why does everyone always end up in the kitchen?

Al:

It's a fabulous thing, and it wasn't always this way. We're told that mothers slaved away in the kitchen and people didn't want to see her or whatever, but now it's absolutely the heart of the home. That people want to live in there. The kids come home from school and they want to put their laptop up on the island, plug into a USB port and start doing their homework. They want to hang out there. You go to a party, the best part of the party is always in the kitchen. So it provides a giant social return to improve your kitchen as well as a significant economic return. So yeah, I think the best parties are in kitchens. And in Winnipeg, I think the return is particularly because I think our real estate is typically under-improved, that the opportunity for giant upside and financial social improvement is huge. So I love what we do.

Adrian:

What's TENTEN?

Al:

TENTEN? TENTEN, we were looking for a name for the business and we had ... on our mind, we were doing business under it's Al Keith contracting for a while. We were walking around, coincidentally in Suits, Washington, which has been in the news recently. And we were literally walking around the mall, not far from the Capitol building and we came across a building that was named the TenTen something building. It wasn't Pennsylvania Avenue, but it was just around the corner from Pennsylvania Avenue. And we put it in our head that all the connotations off of 10 are excellence and we have a business that does excellent work. So we thought it was, at the same time, unique and brandable and common. So people would know what it was, but recognize that it is a little bit different than just calling it 10 or something like that. So anyway, we like our name and we think that we believe in the values that it instills, build beautiful kitchens for wonderful people.

Adrian:

Great way to end. How do people get in touch with you, Al?

Al:

Most people find us through Facebook. We're on Instagram as well too, and certainly house. And you can call Barb directly at 955-9716. For the most part, people don't want to talk to me, they do want to talk to Barb. She'll help them get started, come out, visit with you, determine what it is that you want to do. Also, Jillian Hansel is an interior designer who works with Barb and is a dynamic duo. Give them a call and they'll come out and take a look at what you want to do and build you something that will make us proud and you proud.

Adrian:

Al, congratulations on your acquisition, on the work that you did and on your equity growth. I think that equity growth hopefully will benefit you and your family. And I'm very grateful that you took the time to answer some very personal questions that I think will be of benefit to many Winnipeg homeowners. So thank you, Al.

Al:

Thanks, Adrian. Greatly, we're a big fan of yours and are delighted to have the opportunity to speak with you today. Best wishes to you and your family. And you got to keep loving Winnipeg Real Estate because it's fabulous.

Adrian:

Thanks, Al. Talk to you soon.