Multifamily deal found and can secure funding

1 Reply

Hello BP,

Do you have to get a property under contract prior to pitching the deal? If so, a property selling for 800k-1mil...what are the steps to get it under contract in a multifamily deal, is it a must for a earnest down payment or are these deals typically executed without an edm but an expressed interest given a due diligence period in a reasonable amount of time?

I foresee a common mistake to get excited about a deal and secure potential investors but the property is not under contract. As a "syndicate" or an individual orchestrating the deal with potential investor/partners is this a cost I must be able to provide?

Thank you in advance.

Hi Antonio, I can't address your primary question but I heard of a strategy recently to help you build an investor pool without them getting attached to one deal. First, determine what your "avatar property is" and then work out the NOI, CAP rate, ad other pertinent financial metrics. Then create yourself a sample deal portfolio based off that (maybe with one or two properties where the deal fell through but that you actually underwrote in full). Then you can reach out to prospective investors, tell them about the types of properties you're looking at and get their verbal interest. This can cut down the time it takes to get people to fully commit when an actual deal comes around.

Best of luck getting your primary inquiry answered and I hope this helps a bit. Take care!