Denver, CO · Member since 2016 · 114 posts · 99 votes
I have $2 Million to invest in real estate (part of windfall for selling a tech company). After reading the Ultimate Beginner's guide, I've settled on apartment investing. My question is, would it be better to get multiple properties or invest all $2 million into a single property (down payment on a $10 mill). My goal is to use the cash flow from the $2 million investment to fund my lifestyle and start another company. I would ideally like to get $250K yearly cashflow from this investment. Thanks.
Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
10y
I'd be careful about disclosing such things on a public website ... I can just imagine the sharks starting to circle now that they smell the blood of fresh meat in the water. Your inbox is about to get a workout :)
I agree you should take a measured approach and don't blow your entire wad on a single deal. If you want to invest in apartments, you may consider finding a multi-family apartment syndication deal being offered by a highly reputable provider with a long term, verifiable track record of successful investments and putting $50k-$100k to work in the deal to get your feet wet. Understand that these investments are for accredited investors (which you qualify as), who are assumed to be capable of taking the risk and doing their own independent due diligence (which you should absolutely do); these deals are not generally advertised in the open market and I would not trust those who come to you unsolicited with such deals but rather seek them out through networking and referrals. Local REI meetups may be a good place to start. BP is another place to look, but always remember the saying "Never ask a barber if you need a haircut" and try to figure out who the "barbers" are.
From there, if you want to get active to acquire and manage these assets on your own, you could tag along with your syndication provider and learn from them ... many are open to educating those that invest with them. Otherwise, you can continue to invest passively this way, or some combination thereof.
Jerry, this was a great post and connected you and everyone with many successful experts in the area you are researching. I have only been on BP for two or three months but whenever Joel replies, he is very helpful and on point. You get a lot of nonsense here as well but great help too and Joel, a month or so ago, gave me one of the most valuable pointers I have received on the site, it made joining worthwhile and was a game changer for me on a deal.
yeah Joel has been great. Overall I'm very pleased with the advice I'm receiving on these forums. I think I am going to do a mix of syndication and investing in a larger commercial property.
Denver, CO · Member since 2016 · 114 posts · 99 votes
10y
Originally posted by @Account Closed:
Hi Jerry,
One last thing. Diversification within real estate is best. If you want to avoid complete disaster like 2008, there's only one way. Free and clear ownership. If you want to do some free and clear, and some with leverage, I suppose that's okay, but loans are real estates greedy mistakes. My opinion.
Sincerely,
Jeremy
I appreciate that perspective Jeremy. On the other hand, there's a spectrum when it comes to risk management. Being an entrepreneur, I'm willing to undertake a little bit more risk for higher returns.
Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
10y
Jerry, this post is a bit old at this point, but just read another who is in a very similar position as you but taking a different approach and thought you may find it interesting:
Denver, CO · Member since 2016 · 114 posts · 99 votes
9y
Just wanted to give an update. Been about a year since I posted and I've recently closed my first real estate deal. 2.62M commercial retail strip mall in Atlanta, GA. Got in at a 8.3 cap and put 25% down. Will do about 80K/year in cashflow (11.66% CoC).
Currently looking for a second property and then will put the rest of the capital in some syndication deals, probably with @Brian Burke as I've been reading a lot of what his firm puts out in my inbox and have been impressed. @Joel Owens has also been a great broker in helping me through the process of my first deal. It was very complex and quite scary at times but Joel handled it like a pro. Highly recommended for any beginners looking to get into commercial real estate investing.
I'm starting a new company this year and the passive income from my properties and syndication investments should give me the cashflow I need to not take a salary.
Investor · Santa Rosa, CA · Member since 2012 · 2k+ posts · 7k+ votes
9y
Congrats on your first deal, @Jerry Shen! Sounds like you did really well, which is no surprise given that you were in good hands with @Joel Owens. Best of luck!
Investor/Syndicator · Cincinnati, OH · Member since 2014 · 470 posts · 599 votes
9y
@Jerry Shen Congrats on the first acquisitions! I admire Brian and his company and have only heard good things about Joel. You seem to be on the right path for more success to come. Best of luck on starting the new company this year.
I live in Atlanta. let me know if you ever need a second set of eyes on your property. I am happy to help.
Rental Property Investor · Pasadena, CA · Member since 2016 · 164 posts · 149 votes
9y
Awesome, I didn't realize the original post was so long ago, I was about to make a comment about what you should do. Seems you made some good choices, congrats!
Flipper/Rehabber · Acworth, GA · Member since 2014 · 246 posts · 92 votes
9y
Awesome @Jerry Shen! My father did that with a lot of his money. Shopping strips or sorts. Then transitioned to commercial industrial and single/multi tenant office space. I'm in residential now and will make that transition with time. My wife and I live in kennesaw currently, but are moving out to Colorado for a bit this fall. What was your purchase in kennesaw? The shopping strip? Or something different?