24 y/o Agent wants to get into Development

8 Replies

Hi everyone, I've been a "ghost" member for a few years soaking up as much knowledge as I can from the experienced members.

I'm 24 years old and have been a licensed agent for 3 years. I was able to build my network of investors and builders who work with me as I find them the deals off market.

My question: Ultimately I want to be a developer (land/property value in my area and city starts at approx $1M to $4M for a good lot.) 

What angle can I pitch the investors I work with to bring me into the deal as an equity partner (NOT a commission) given they are all seasoned and have all the pieces to the puzzle.

I appreciate everyones advice in advance. 

Well if you have found them deals off market in California then you should be sitting on some great cash to JV on something.

If you have no cash and want to learn the ropes there is no reason to bring you into a development deal.

Look up Will Barnard on here. He might have some ideas.

I'd echo @Joel Owens  sentiments. Since you are finding the deals, you have a good deal of control over what happens to the deals you find don't you? If you have cash on top, it shouldn't be unreasonable to negotiate yourself into the deal as an equity partner and the member in charge of acquisitions and lease up or exit.

Do you generally represent the builder or investor as the buyer of land and as a seller?

I would recommend finding a investor and builder who have worked together and would be open to adding a member to the team for a future project.  If you can bring some capital to the deal, that will make it a lot easier.  I would focus on finding a project with a high degree of success vs. getting the maximum personal return as you are learning the ropes.

I would plan to find multiple potential properties and letting the partners decide from the options.  If you don't bring capital you need to make sure your arrangement will not get you in trouble in terms of a "net listing".

The deal is half the battle so brining that portion is step one. Since you have no development experience and the developers do, there is not much additionally you bring to the table beyond the deal itself unless you bring money to the table. If that is the case, then you are in a position to negotiate some equity terms. If not, find the deals, represent the buyer and ask to be in the planning and development stages to learn.

Another thought, take yr commission earned and kick it back to the developer, getting that commission, pls perhaps some interest or equity on the backend which the provision that you stay as part of the deal to learn the ropes.

Originally posted by @Will Barnard :

Another thought, take yr commission earned and kick it back to the developer, getting that commission, pls perhaps some interest or equity on the backend which the provision that you stay as part of the deal to learn the ropes.

 It may take a couple deals on commission on both sides to get them to want to bring you on as an involved partner.   If they are interested in selling before completion, just being the listing agent on the exit side could give you a fair amount of insight into the development process.

Originally posted by @Will Barnard :

The deal is half the battle so brining that portion is step one. Since you have no development experience and the developers do, there is not much additionally you bring to the table beyond the deal itself unless you bring money to the table. If that is the case, then you are in a position to negotiate some equity terms. If not, find the deals, represent the buyer and ask to be in the planning and development stages to learn.

Another thought, take yr commission earned and kick it back to the developer, getting that commission, pls perhaps some interest or equity on the backend which the provision that you stay as part of the deal to learn the ropes.

 Great insight, would love to pick that brain out. I'm now thinking of this deal structure. Bring the deal and do the ground-up/rehab. Is financial partner hard to come by in LA County? Some say its the least of my worries, some say its hard if I don't have prior experience (not sure if its investing side or residential rehab side). Kind of confused with that. Thanks.

@Manolo D.  To do the deal yourself would require the money so finding a partner to fund is part of the battle. Anything is obtainable with enough insight, hard work, and dedication. Finding money is not easy, but it is not rocket science either. Since you also lack experience, doing such a deal will prove to be difficult. It would be my recommendation that you start smaller and do a smaller deal on your own, if you mess up, it should not be too big. Trying to start with development deals can be difficult without experience, capital, or know how.

Originally posted by @Will Barnard :

@Manolo D. To do the deal yourself would require the money so finding a partner to fund is part of the battle. Anything is obtainable with enough insight, hard work, and dedication. Finding money is not easy, but it is not rocket science either. Since you also lack experience, doing such a deal will prove to be difficult. It would be my recommendation that you start smaller and do a smaller deal on your own, if you mess up, it should not be too big. Trying to start with development deals can be difficult without experience, capital, or know how.

Thank you Will. I do have what it takes to get into the game, I might need more time to find those deals and funds. What would be the best way to go with if my experience is only self-performing contractor? Not that I do the hammer swinging but have handled a crew of 20 most of the time. JV? Partner with wholesaler and funding partner? I would take your advice as not to go into development for the moment. Thanks again for taking the time to answer the post.

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