Congrats !!!!!!!! Happy investing.

Thanks, @Donald S. I try to be cordial, even when I tell someone they are stupid. But, I agree, the trolling thing got a bit annoying for a minute...I am glad it looks like we've got it under control.

There is a lesson to learn here - some people value their time in this life for so little as to engage in this type of a discourse. That, to me, is unbelievable.

Pay it forward. Do good. Help people. Enjoy sharing the intellectual worth with people. It comes back ten-fold.

@Chris Clothier and I have disagreed more than we agreed over the years. Perhaps because of this, it was especially nice, Chris, when you were the first to step in...thank you!

Congratulations! I love the look of it both in terms of the open courtyard and swimming pool. Also the apartment you show looks like it's open concept which is fantastic. 

Congrats @Ben Leybovich and @Sam Grooms !

Very cool to see how the big boys swing.  Well done

@Ben Leybovich You wrote "Jay, statistically it costs on the average about $1,000 per door per annum less to run multifamily in the South-West than Mid-West."

I'm really intrigued by this. Do you happen to have a study or reference? I'm not doubting it. Up in the Washington and Oregon I get really tired of dealing with mold in apartments. It's difficult to prevent and expensive to fix. It also seems that roofs will last longer in a dry climate. 

We are thinking of investing with the southwest next go around and would love to know that our costs will go down on these line items.

Originally posted by @Ali Hashemi :

Congrats @Ben Leybovich and @Sam Grooms !

Very cool to see how the big boys swing.  Well done

What you don't see, Ali, are the hard knock and bloody knuckles...just keep that in mind :(

I am all for the excitement on this thread. And I am all for the motivation we are spreading. I just want to temper that with a pinch of reality...

What Sam and I are doing today belongs in the big boys' sphere. But, we've eaten a lot of proverbial **** to swing this way :)

Thank you, indeed!

Originally posted by @Rhonda Wilson :

@Ben Leybovich You wrote "Jay, statistically it costs on the average about $1,000 per door per annum less to run multifamily in the South-West than Mid-West."

I'm really intrigued by this. Do you happen to have a study or reference? I'm not doubting it. Up in the Washington and Oregon I get really tired of dealing with mold in apartments. It's difficult to prevent and expensive to fix. It also seems that roofs will last longer in a dry climate. 

We are thinking of investing with the southwest next go around and would love to know that our costs will go down on these line items.

Hah yup. IREM report - google it :) Although, on the small scale it won't do you much good because the numbers are different. These are apartment stats.

@Ben Leybovich

 This is awesome !

Congratulations !

#Goals !

What was acquisition price ?

What is projected disposition value ?

Was 100% of acquisition and improvement costs coming from raised capital?

Or did you have a lender provide lion's share of costs as debt, then raise the remaining capital as equity ?

@Ben Leybovich Congratulations to you and @Sam Grooms ! Officially time for me to book some flights for @Mike Acri and myself to come celebrate in person :)

Originally posted by @Justina Makinen :

@Ben Leybovich Congratulations to you and @Sam Grooms ! Officially time for me to book some flights for @Mike Acri and myself to come celebrate in person :)

Absolutely! 

@Ben Leybovich Congratulations that was a great move

Congratulations!  I'm a native Phoenician and have been investing here for the last 25 years.  It looks like a great property in an obviously hot market, pardon the pun.  Can I ask what part of town and approx. price per unit?  I have been looking for something similar for a while now. On top of a great looking property you bought from a non institutional owner which is fantastic. 

Thanks,

Adam

Originally posted by @Adam Mauck :

Congratulations!  I'm a native Phoenician and have been investing here for the last 25 years.  It looks like a great property in an obviously hot market, pardon the pun.  Can I ask what part of town and approx. price per unit?  I have been looking for something similar for a while now. On top of a great looking property you bought from a non institutional owner which is fantastic. 

Thanks,

Adam, we paid $8.15 for this. 98 units, so a tad over $83,000 per door. I had to break out my calculator because I realized that I didn't know the per unit price...not really important to me all that much :)

Interestingly, I am not bothered by the "hotnes", either temperature or Cap Rates. Actually, I am enjoying both :)

Wow! That's a lot..Congratulations.

@Ben Leybovich I would love to see what that “bug picture” looks like!! I hope it’s colorful. Lol!!! Great job!! Just give me some time I’ll be right behind you or beside you.

Congratulations! My husband just quit his job to syndicate apartments (and by that I mean underwrite deals all day every day...).

Would you be willing to share your thoughts on your exit cap rate? Not so much the specific numbers but your assumptions in forecasting it? I realize that the entry cap rate on a value add doesn't really mean much. But since you're looking out 24-46 months, how did you do that?

Our method (not all that scientific) has been to look at what similar, stabilized properties are trading at and inflate that.5-1% (depending on the market) just to be safe.

Great details on everything about the property, process and expectations  @Ben Leybovich and @Sam Grooms ! Very informative. Thank you for sharing, sounds like a great find. Wish you both continued success! 

Originally posted by @Ben Leybovich :

Originally posted by @Nik S.:
@Ben Leybovich @Sam Grooms Congratulations!! By you being able to have your offer accepted prior to the call for offers is everything!! How were you able to do so? Recently, when I tried to do that the broker suggested I give a non-refundable deposit of $10-20k to get it under contract prior to any other offers.

In hindsight, I definitely should have done it but lesson learned.

Hick - this was $100,000 EMD with NO FINANCE CONTINGENCY.

$50,000 good faith to lender to begin the app. 

$15,000 to the securities attorney.

$7,000 to RE Attorney

If my math is right, I think this is about $172,000 hot on Day 1.

Freaking crazy, but such are the big boys club rules.

Is that about right, @Sam Grooms?

 If you are afraid of deep and you have to stay in the shallow waters.  Congrats on your move. @Calvin Lipscomb Jr

Hey Ben thanks for the great post. Happy you are getting into bigger deals, doing it up Sam Zell style, and appreciate your knowledge. I'm not sure if you posted this earlier but I take it since it's a 5 cap you have around 400K net income on this deal? I've read some of your work so I imagine the roofs are not flat ;). Will you be sharing before and after pictures with us? Does it also follow your 2 bedroom "heaven on earth" criteria? Curious if having the majority of units as 2 bedrooms still matters to you at this scale. I read your website and it says that you buy below replacement cost. How many square feet is this 98 unit and what did you pay per square foot? What's the replacement cost in Arizona now? Many thanks, Carl

@Ben Leybovich

And I thought I was smart.. 👀

I would ask a question but I'm thinking NO SELF promotion Chuck... No self promotion! +the cold & flu meds are kicking in 😷..

Great thread ...great thread. 

This is a great deal. Awesome! I’ve read through several of the comments and i was able to gather a few pieces of information but i want to get a specific answer directly from you regarding the financing structure. I am very interested in sourcing andsyndicating my investments and i am wrapping up my private equity investment model before i begin to pursue investors. So i am curious, can you break down the structure of your financing including any conventional, creative and any private financing? Thanks for your time. I hope we can talk soon

Congrats on this one @Ben Leybovich and @Sam Grooms ! I love the location of the deal and think your investors will be pleased with this project. 

Hi Ben,

Thanks for the reply.  I seem to be very interested in price per unit, it helps me make sense of some deals.  You made a great purchase. Keep up the good work.

Adam

Love it Congrats Ben!

Congrats! Looks like you guys have done the legwork and landed a fantastic deal. Well done and good luck!