We finally closed today on our first multi-family apartment complex! Seems like such a long road after making the decision to transition out of SFH last Fall and selling off our portfolio in the Spring. I ramped up my education quickly as I knew nothing about cap rates, NOI, due diligence, etc. The pressure was really on when we elected to do a 1031 exchange. We were under contract on a property pretty quickly but after numerous extensions the deal fell apart. Thankfully, we had a good backup plan and used what we learned in the first deal to nail it on the second. Much hard work in front of us but we will celebrate tonight!
How many units and is it in your hometown?
Congrats @Tony Castronovo !
@Tony Castronovo , You moved through that like a champ. The forward planning and ability to adapt to that first closed door was the key to your success. Way to go!
Congrats @Tony Castronovo !! Were you able to use a broker to find the 2 deals you went after or were you lucky enough to find something on Loopnet? We would love to hear some more of the numbers if you are comfortable sharing?
@Tony Castronovo that is great news, man! Cheers!!
@Paul Choi Thank you! 20 units and not my town. It's a sub-market of Houston. Bryan - College Station, Texas. It's about and hour and 15 min away.
Thank you @Grant Rothenburger !
Thanks for all your help @Dave Foster ! It was great working with you on this deal. At the end of the day I am paying taxes on a little over $1000 capital gains on the sale of a $1.2M portfolio. Not too shabby.
Thanks @Jon Crosby ! I did use a broker and he helped me find some off market deals. But both deals were also on LoopNet....just can't recall if we found them first. On the eventual deal we definitely got in on that right away. The first deal was on the market for several months before we found it.
Happy to share numbers....just let me know what you are interested in knowing. PM me if you want to know more.
Curious why your having to pay taxes? Was the new project under the amount you needed for the 1031? Is the project in Bryan or CS?
Congrats @Tony Castronovo !
Is this a stabilized or value-add property? Are you planning to "buy and hold" this property?
Congratulations! Best of luck with your new complex.
Thanks @Mark Sewell !
@Steve Pittman the proceeds from the sale of our SFH portfolio ended up being greater than what we needed for the MF. We ended up getting 80% LTV on the loan, which reduced our down payment requirements. The property is in Bryan (very close to A&M...although we do not plan to market to students)
Thank you @Keisha Andrew . I sure hope so!!
@Jeffrey Almonte Thanks! It's a bit of both. It is stabilized at 90% occupancy. But rents are way below market and we will be renovating and driving rents where they should be.
@Tony Castronovo Great work Tony. Nothing like being able to drive market rents up and really get full value out of the place. Congratulations
@Brian Mcmenamin Thank you. Check back with me in 6-9 months to make sure the plan is coming to reality.
Congrats @Tony Castronovo. It seems like commercial broker sends only their lising (off-market) in e-mail so they can get deserved commission both sides. so is it ok to connected with more than one broker ? and how many deal one need to look before purchase contract, if any? I would really appreciate your answer.
Thanks @Johnny Bravo !
@Kinjal Patel Thank you. In single family I seldom used agents. But I chose to work with a commercial broker that I have known for many years (but never worked together). It was really great because not only was he an agent/broker, but he's also an investor. So I got a real good education as we talked about everything from due diligence to negotiation strategies, operations, property management, tax strategies, lenders, financial analysis, etc, etc. He never sent me "his" listings. He knew my parameters and searched for me and networked with other brokers. Very much worth it.
I don't know how many deals other investors have looked at before making a purchase. For me, I probably looked at a couple dozen on paper, toured about ten, analyzed six or eight and made offers on two.
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