Best way to invest several million+?

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Best way to invest several million+?

Uzi Pablo
Member since 2018 · 17 posts · 4 votes

Hello, I'm very new to Bigger Pockets, but I've had this forum bookmarked forever until I really needed it.

I sold one of my companies some time ago and now have a regular stream of ~1 million per month to invest. So far I'm a very aggressive entrepreneur, but I don't know the first thing about real estate, and that's where I want to divert a lot of my income to supplement my standard investment strategy of stocks, bonds, other companies, etc. I'm thinking maybe 10-30% of that into real estate to start.

To be honest, I know absolutely nothing about real estate. So I have started in the Education section in the beginners guide. I was also considering buying the Bigger Pockets book on real estate investing.


There's so many areas of interest though, that I'm wondering which area(s) one might suggest I focus on first, just so I'm on the right track from the beginning. From there I can study all day long until it starts to click.

My ultimate goal is (fairly) hands off income @ ideally around 10% return. More would be incredible. I'm not sure if that's possible while using a management company to manage properties, so if that's not reasonable I'd love to know what is. I have no problem hustling and doing work, but I'm really trying to find something that doesn't require an immense amount of time per day/week. If that also isn't possible I'd love to know what is a more reasonable goal. In the back of my mind I think "what if I had 10 or 20 properties being managed by a company and I just collect income from them" type of deal. Obviously there's a lot more to it, but that's sort of the direction I was thinking.

I don't know if wholesaling or flipping is a good strategy for me either (still reading about that, haven't gotten there yet). Any insight would be appreciated where to start.


Thanks to you all.

- U

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Brian Garrett
Real Estate Investor · Palm Beach County, FL · Member since 2017 · 3k+ posts · 2k+ votes
7y

Be prepared to get a lot of colleague requests and messages now that you announced you have $1M per month income and know nothing about real estate but want to invest. In the future you should never disclose on a public forum how much cash you have available. You will attract more of the wrong people than the right ones. Be very cautious of those who message you offering their services. With all that being said I’d suggest you keep your money safe and sound in a high yield savings account or something alike while you study various investment strategies and learn which is the one you want to pursue. As you gain more knowledge you’ll start to figure out exactly what direction to go. Welcome to BP and best of luck!

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  • Joseph M.
    Flipper/Rehabber · Los Angeles, CA · Member since 2009 · 1k+ posts · 732 votes
    7y
    @Uzi Pablo You have a lot of good suggestions and ideas so far . Definitely think it’s a good idea to educate yourself even if you do decide to be more passive of an investor . One thing I don’t think anyone mentioned is land. Of course it doesn’t usually generate income .. but land can appreciate very significantly . I’d look into land in the path of progress . Doesn’t make sense for most investors since they need /want to generate income but could be something to look at as part of your re investments
    0Reply
  • Adam Wigdorski
    Rental Property Investor · NY · Member since 2017 · 132 posts · 90 votes
    7y
    @Uzi Pablo I mean it’s your money so your the bank. So you set the terms. You can do 3 month, 6 month, 1 year, 100 years Def get a lawyer who knows his stuff though. Because he will have to do research on just not the state but even the county or parish. He’ll have to come up with a good dead and dot to make sure your covered. I mean everyone’s different. I know a pml who does 80%ltv, 30 year amort, 1500 fee, and max 18 month term. And then I know another guy who does 100% of whatever you want at 16%
    1Reply
  • Adam Wigdorski
    Rental Property Investor · NY · Member since 2017 · 132 posts · 90 votes
    7y
    @Uzi Pablo But I guess I forgot to answer the question. You can charge the principle and interest day one. In the promissory note have penalties. If they miss a month there’s a penalty. If they don’t refi out and/or pay in full in 12 months take the house.
    1Reply
  • Mary M.
    Rental Property Investor · Portland OR · Member since 2018 · 2k+ posts · 3k+ votes
    7y

    As someone who had to invest  large ( for me) sum of money when i had no experience in RE what i did was find someone who could help me at least get my feet wet. I got super lucky and connected with a broker who is a once in a lifetime broker and he has the connections that set me up to suceed...  He helped me sell what i had and get into something more my style (3,000 sqft bldg in SOMA IN SF ( too risky ) for MF in Eugene OR)   This play has allowed me to have a decent income and some stability 

    My point is you need a REPUTABLE team of high net worth brokers, CPAs and Attys.  I suggest Colliers, Marcus & Millichap or similar.  

    Good luck :)

    0Reply
  • David H.
    Madisonville, LA · Member since 2018 · 125 posts · 71 votes
    7y
    If your feeling in a million a month who cares about investing lol
    0Reply
  • Lindel Turner
    Investor · Jonesboro, AR · Member since 2017 · 136 posts · 79 votes
    7y
    @Uzi Pablo I wouldn’t invest a dime in real estate if I had to write a post like that. Stick with what you know
    0Reply
  • Pratik P.
    Flipper/Rehabber · Sacramento, CA · Member since 2016 · 807 posts · 815 votes
    7y

    You're already really good at something, why don't you capitalize on that instead of trying to get into a completely new business? Maybe start another business in your field with the funds you have?

    0Reply
  • Uzi Pablo
    OP
    Member since 2018 · 17 posts · 4 votes
    7y
    Originally posted by @Pratik P.:

    You're already really good at something, why don't you capitalize on that instead of trying to get into a completely new business? Maybe start another business in your field with the funds you have?

     Because I was looking for (partially) passive investment strategies that would beat your run of the mill low-medium risk portfolio. Based on what I heard it seemed some aspect of real estate investing would fit this bill. 

    0Reply
  • Pratik P.
    Flipper/Rehabber · Sacramento, CA · Member since 2016 · 807 posts · 815 votes
    7y

    @Uzi Pablo Gotcha. Definitely look up Grant Cardone on youtube and watch his real estate episodes. You'd probably want to get into syndications if you want to stay pretty passive. I don't know about becoming a Hard Money Lender like some have suggested. Because then you'd need to learn about underwriting flips..

    If I had that much cash, I'd be looking for large multifamily deals full time. But that's just me....

    Also, you should maybe make a post about some lessons you've learned during your journey. Lots of us here could use insight from someone as successful as you  :]

    0Reply
  • Robert C.
    Investor · San Francisco, CA · Member since 2016 · 338 posts · 444 votes
    7y

    @Uzi Pablo, I've been having fun watching the responses to your post here because... well, not a lot of people of your financial means ask something like this in the forums. Pretty entertaining!

    I posted this once before, but it sounds like you fit the profile for Tiger 21 perhaps. A friend of mine turned me onto it. I'm not actually a member myself, but he seems to get a lot of value from the network (he's a retired hedge fund guy in his early 40's). I like to follow their quarterly reports, though, which tell you how the members allocate their wealth. Right now, it seems like about 25%-30% of assets get allocated to real estate. You may want to take a closer look so you can ask your peers directly (going along with that theme of talking to people more successful than you). Good luck!

    0Reply
  • Ellis HammondPro Member
    Investor · Leawood, KS · Member since 2017 · 178 posts · 108 votes
    7y
    @Uzi Pablo Los Angelas this weekend! Crazy full conference with some of the best syndicstors in MF and self storage. Let’s connect!
    0Reply
  • Uzi Pablo
    OP
    Member since 2018 · 17 posts · 4 votes
    7y
    Originally posted by @Robert C.:

    @Uzi Pablo, I've been having fun watching the responses to your post here because... well, not a lot of people of your financial means ask something like this in the forums. Pretty entertaining!

    I posted this once before, but it sounds like you fit the profile for Tiger 21 perhaps. A friend of mine turned me onto it. I'm not actually a member myself, but he seems to get a lot of value from the network (he's a retired hedge fund guy in his early 40's). I like to follow their quarterly reports, though, which tell you how the members allocate their wealth. Right now, it seems like about 25%-30% of assets get allocated to real estate. You may want to take a closer look so you can ask your peers directly (going along with that theme of talking to people more successful than you). Good luck!

     Awesome, thanks a lot. I'll take a look at that. And yes, I'm not like your normal person as far as what I want to do / am interested in.

    0Reply
  • Alex Franks
    Rock Hill, SC · Member since 2015 · 1k+ posts · 597 votes
    7y
    @dennis Dahlberg

    Great advice I'm still a little guy but when I do have the capital I get it to work with local flippers as well

    Alex

    Originally posted by @Dennis Dahlberg:

    Dont buy the homes, be the lender.....it took me years to figure this out.

    I use to work very hard flipping homes. 

    Late one, night writing checks for all the hard money lenders, my wife said “what are you doing?” 

    Told her I need to make sure all the lenders get paid, I’ll be in bed soon...

    She said “Looks like your on the wrong side of the business, don’t stay up too late dear.”

    And she was correct.........

    Always listen to your wife......

    0Reply
  • Alex Franks
    Rock Hill, SC · Member since 2015 · 1k+ posts · 597 votes
    7y
    @uzi Pablo '

    First money is not everything and never tell folks what you have. You are going to get flooded, my friend. My humorous side says come to play poker with me texas holdem. World Series Poker coming up here locally. My business side says change this add. Instead of it should have said how to make a solid 10 % return in this business the best ways to achieve this. Promise I am one of the dumb folks here so take what I say lightly.

    Okay to late but on the serious side. If I had to talk to some serious folks.

    I would follow along and see who are the folks helping folks daily here. There are some very smart folks on this site. These are the folks who don't need money but are the ones I would want to be working with. So many ways in this business but do you really want another business. Flipping, wholesaling that is more of a job. Syndications are what I would think or lend locally until you understand the business more. If I was to get in the lending business or want to know more. Type in Lending and you should see certain names come up as they can give more advice then most folks. I would CC one person but again not to wast his time or yours. 

    Alex



     


    Originally posted by @Uzi Pablo:

    Hello, I'm very new to Bigger Pockets, but I've had this forum bookmarked forever until I really needed it.

    I sold one of my companies some time ago and now have a regular stream of ~1 million per month to invest. So far I'm a very aggressive entrepreneur, but I don't know the first thing about real estate, and that's where I want to divert a lot of my income to supplement my standard investment strategy of stocks, bonds, other companies, etc. I'm thinking maybe 10-30% of that into real estate to start.

    To be honest, I know absolutely nothing about real estate. So I have started in the Education section in the beginners guide. I was also considering buying the Bigger Pockets book on real estate investing.


    There's so many areas of interest though, that I'm wondering which area(s) one might suggest I focus on first, just so I'm on the right track from the beginning. From there I can study all day long until it starts to click.

    My ultimate goal is (fairly) hands off income @ ideally around 10% return. More would be incredible. I'm not sure if that's possible while using a management company to manage properties, so if that's not reasonable I'd love to know what is. I have no problem hustling and doing work, but I'm really trying to find something that doesn't require an immense amount of time per day/week. If that also isn't possible I'd love to know what is a more reasonable goal. In the back of my mind I think "what if I had 10 or 20 properties being managed by a company and I just collect income from them" type of deal. Obviously there's a lot more to it, but that's sort of the direction I was thinking.

    I don't know if wholesaling or flipping is a good strategy for me either (still reading about that, haven't gotten there yet). Any insight would be appreciated where to start.


    Thanks to you all.

    - U

    0Reply
  • Scott Morongell
    Investor · Charlotte, NC · Member since 2017 · 791 posts · 479 votes
    7y

    @Uzi Pablo Thanks for the info. Honestly I wouldn't invest any of it until you have educated yourself on the risk/reward involved in each sector of real estate. That being said, if your looking for more of a hands off approach have you look into being part of a large deal with others running it (syndication). This will allow you to have scale and leverage while being hands off. Looking forward to hearing where your leaning and choose to invest.

    0Reply
  • Account Closed
    Investor · Milwaukee, WI · Member since 2013 · 1k+ posts · 1k+ votes
    7y
    Originally posted by @Uzi Pablo:
    Originally posted by @Account Closed:

    Goodness. Why not just retire? Live comfortably. Give the rest away to family or charity. Volunteer at an old-folks home? Take up fishing or painting? All of the above?

    Seriously. What is the point of creating the largest pile of cash you can if you never intend on using it for anything?

    The lottery got up to like 1.5 billion the other week. As I dreamed about what I would do with my winnings, I came to realize it was more money than I could ever spend and it would actually become a liability to a normal life. The only rational choice for me would be to give it all away (ok, most of it).

    But, I suppose if you want to be as famous as Rockefeller, Morgan or more recently Gates or Buffet, you just keep on keeping on. The thing I love about Buffet is he helped a whole bunch of people get rich right along with him.

    But seriously, be the lender if you want the best returns for the least amount of actual work. There are firms that do that out there for you to invest in. No? Well then, I'll take your money and build a portfolio for you, but the cost will be an interest free loan. I can deliver your 10%.

    Everyone always has an opinion on what people should do with their money. Quite literally I do almost every thing you mentioned with the exception of volunteering at old-folks homes. And, I am not retiring because I'm not even half the age of retirement yet. It's not in my DNA to sit around idle (maybe later in life). A life of learning, creation, failure, and texture is what excites me.

    And thanks for the suggestion about lending, I'll research more into it. It seems several people have said that.

    No one really ever retires do they? Well, if texture is what you are looking for, maybe simply lending would be too boring. I do this stuff yes, because I see it as a decent investment, but it is certainly not the best investment out there to be had by a long-shot. What I really love is the art of the house and being part of creating/reviving the art form - the texture of it all. Some people see studs and drywall and square boxes with roofs. I see thousands of years of human beings contemplating, trying, succeeding, failing and revising each molecule of our domiciles. It really is one of the most designed innovations of the human existence. LOL - Deep thoughts for thin walls...

    I wasn't kidding about building a portfolio for you, but this is not the appropriate way to initiate something like that.

    Peace out rich man and keep on enjoying the art of the world like only you rich folk can afford!!! For now I will enjoy at your level vicariously only but I tell you what...it's the little things that really count sometimes. For instance, like when a small business owner will let the crazy cat guy post a flyer of his missing cat on the front door without a second thought while conversely, the big corporate stores have thought-out and decided-on policies and protocols against such small community interactions/sentiments...found that out this week. Walmart and Walgreens get zero of my dollars from now on because..they can FO. I would blacklist Menards too...but...I love houses too much...lol.

    1Reply
  • Odie Ayaga
    Specialist · Delran, NJ · Member since 2016 · 2k+ posts · 951 votes
    7y

    I know this thread has died down a bit, but with those kinds of funds you should have access to a number of high net worth individuals in your network. You can trudge through various real estate books blindly, but I'd think working within your network to expand it and finding out who those people know and trust in real estate then using those connections to sit down and talk with actual people would beat trying to self-educate. They would be able to both provide education and their experiences as well as provide a potential source to invest in as well as offer some recommendations on what you might read to supplement their information.

    For instance, I know @Dave Van Horn runs a group for high net worth individuals. Groups like that are what I'd be looking to in your situation. Best of luck!

    0Reply
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