50 doors in 3 years, Help!

Buying & Selling Real Estate
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50 doors in 3 years, Help!

Tri Le
Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes

Hi BP,

I figured I would appeal to the collective intelligence of my fellow investors.  

Over the last 2 years, I've built a small portfolio of single family houses, duplex, triplex, and 4plexes.  We have done BRRRs, major rehabs, short term, and long term rentals.  

After reading Vivid Vision (Great book!  Highly recommend!), I have come to the conclusion that I would like to focus my energies on scaling our business.

I have set a goal for myself to reach 50 doors in 3 years.  If the average cash flow per unit is $200, I will be financially free.  

Although there are many avenues (ie Mobile Homes, Assisted Living, etc.), I want to narrow my focus towards the purchase of a 40 unit apartment building or a combination of two 20 unit apartment buildings.  

The next step is to make a plan for the following:  

1. Finding the deal

2. then, find the lending/financing (This can be a combo of commercial lending, line of credit, private lending etc)

BP, help me develop this plan and any input is much appreciated.  We only have 30 days to organize a plan and 60 days to put the first offer!

Humbly,

Tri

  

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George W.
Investor · NJ · Member since 2018 · 869 posts · 921 votes
5y

Why not just try to increase the average monthly cashflow to require less "doors" and make the same amount of money?

Cashflowing another $100/mo would cut almost 17 units out of the picture and make the same amount of cashflow. Plus it would alleviate the stress. I'd rather deal with 33-34 units than 50 if that cashflow is gonna be 10k either which way.

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  • Tesho Akindele
    Rental Property Investor · Orlando, FL · Member since 2016 · 135 posts · 145 votes
    5y

    Congrats on your success @Tri Le. I don't know much about investing in medium-sized multi-family, but the one thing I have heard from people who do is the importance of getting a mentor. If I were you, before even looking for a deal or financing I would try to connect with other multi-family investors in your area. They can probably offer some really helpful insight that will allow you to hit your goals faster. 

    2Reply
  • George W.
    Investor · NJ · Member since 2018 · 869 posts · 921 votes
    5y

    Why not just try to increase the average monthly cashflow to require less "doors" and make the same amount of money?

    Cashflowing another $100/mo would cut almost 17 units out of the picture and make the same amount of cashflow. Plus it would alleviate the stress. I'd rather deal with 33-34 units than 50 if that cashflow is gonna be 10k either which way.

    15Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Hi Tesho and George,

    I love the comments!  I'll add finding a mentor.

    In regards to aggregating/consolidating units, I definitely see the advantage of having fewer units to manage and higher cash flow.  This is a very good point.  This works if the plan were to stop at $10k/mo cashflow.  50 doors is the first milestone to 1000 doors.

    2Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    The universe works so mysteriously.  I posted this challenge without seeing that Brandon and David interviewed Cameron Herold, author of Vivid Vision.  Listening to it now!  

    Keep the comments coming.  Thank you in advance!

    3Reply
  • Eric Schultz
    Investor · San Diego, CA · Member since 2016 · 265 posts · 305 votes
    5y

    @Tri Le

    Have you narrowed focus to a specific market?

    Do you have a team of contacts in place (e.g. mentor, CRE broker, RE attorney, lenders, property manager, contractors for rehab / maintenance, etc.) ?

    You can always add some of these team members after making offers, but it will sure help secure more results with some of these team members already in place.

    2Reply
  • Mike Dymski
    Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes
    5y

    50 individual rental properties sounds like a poke in the eye with a sharp stick; so, I applaud the strategy to purchase one or two properties with more units instead.  Profit per property matters (a lot) more than profit per door.

    9Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Thank you Mike and Eric for you comments!  

    I'm looking in the Cincinnati area. This is where I have the infrastructure to manage the apartments. Of the listed members of the team, I still need a CRE mentor, CRE lender, and CRE broker.

    The 4 plex is the closest property in my portfolio to an apartment.   It's provided a glimpse of apartment building investing, but I'm sure that there are factors of scale that make larger apartments different.  

    Although 50 SFH can have advantages, it doesn't fit into my long term thesis or vision map. If I had 50 SFHs, I'd probably be looking to trade up to a large apartment. I'm buying a condo from a landlord with 40 houses, and he seemed stressed.

    Based on the feedback so far, I'm setting an action step to talk to 5 brokers in the Cincinnati area within the next 2 weeks, and I'm going to leverage my current network to find someone already investing in apartment buildings and set up a virtual meeting.  

    Keep it up guys! Thank you for the support!

    5Reply
  • Joe S.Pro Member
    Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
    5y
    Originally posted by @Tri Le:

    Hi Tesho and George,

    I love the comments!  I'll add finding a mentor.

    In regards to aggregating/consolidating units, I definitely see the advantage of having fewer units to manage and higher cash flow.  This is a very good point.  This works if the plan were to stop at $10k/mo cashflow.  50 doors is the first milestone to 1000 doors.

    Must have been an awesome book! LOL

    0Reply
  • Eric Mcginn
    Real Estate Investor · Chico, CA · Member since 2016 · 248 posts · 105 votes
    5y
    Originally posted by @Mike Dymski:

    50 individual rental properties sounds like a poke in the eye with a sharp stick; so, I applaud the strategy to purchase one or two properties with more units instead.  Profit per property matters (a lot) more than profit per door.

    😂 lol! I'm feeling this more this year doing taxes and applying for a refi is getting I credit complicated even with 5 properties and 9 units. The quadplex is as much paperwork as the SFH so this makes sense.

    2Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    A wise man once said, "No risk it, no bisquit."

    I feel you Eric.  Let's partner up and take down this 104 unit apartment in Louisville.  The taxes can't be much worse. :)

    1Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Hi Chin, 

    You definitely brought up a good point.  I didn't elaborate on my other metrics, but I'm shooting for a 10% cap rate and around 35-60k per door.  I'm willing to buy a 7 or 8% cap with some value add to get to 10%.  However, these numbers are just a starting point.  Location would be an important metric for me as well.  

    Depending on the deal, it will affect funding (ie seller finance, conventional loan, private lending, hard money etc).  In my limited experience, the funding isn't too much of a barrier as long as the numbers on the deal work.  

    The 30 day and 60 day deadlines are to instill a sense of urgency.  Also, it helps me break down the 3 year vision down to a managable timeline.  

    0Reply
  • Tucker Cummings
    Investor · Raleigh, NC · Member since 2019 · 433 posts · 743 votes
    5y

    @Tri Le congratulations on your success so far! Looking forward to seeing an update when you actually hit your milestone!

    As far as the plan goes, anytime I have a big project or goal to take down, I write down every step that needs to happen between now and the end. I’ll also fill in who I need in order to help me get there. Once the plan is down, I start executing.

    1Reply
  • Paige Hutchinson
    Real Estate Broker · Gulf Shores, Orange Beach · Member since 2020 · 65 posts · 18 votes
    5y

    Congratulations! Your plan sounds great. I definitely believe the less doors and more cash flow is important.  I would like to know what software are you using to keep everything organized?

    2Reply
  • Jon KellyPro Member
    Investor · Bethlehem, PA · Member since 2016 · 929 posts · 951 votes
    5y

    @Tri Le well done. I wish you the best of luck. Sounds like you are committed to taking action. 

    What states/cities are you looking for your 40 or 20unit property? 

    1Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Thank you BP for the outpouring of support.  Inspiring to know that "we" are not all alone!

    Tucker, this is an area that I definitely need to improve.  Writing down and mapping the plan.  Going to start now!  I'll try to upload a pic of the mind/vision map when I can.

    As an update, I did connect with 3 investors in the last 24 hours, so definitely a start to securing funding.  I also made a list of some brokers, I'm going to contact this week for some intell.

    I don't want to get ahead of myself, but dare I say, we shoot for something larger?!

    Keep it coming BP, the plan is coming together.

      

    1Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Hi Paige and Jon, 

    Full disclosure, I will admit that I am still a fledgling when it comes to leveraging technology to monitor deal funnel and track progress.  This should be part of my 30 day goal/plan.  I will start looking into CRM platforms to get more sophisticated.  If you have any recommendation, please share.  So far, a rather archaic method of excel spreadsheets, folders, and using the property manager's ledger sheet has worked well for the 7 property portfolio.  However, if I plan to scale, I need to think in terms of building a business.  Ugh rookie mistake I guess. 

    Jon, I'm looking mainly in Ohio because of familiarity and infrastructure, but this may be a crutch.  I am currently managing my portfolio long distance.  Shout out to David Greene for his book!  That being said, I am open to other markets, such as Texas, Alabama, Missouri, Tennessee, Kentucky etc.  If we can build a team and the numbers work on the deal, it's a green light.  

    Thank you both!

    1Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Hi Chris,

    We will be in touch brother!

    0Reply
  • Cathy Malmrose
    Rental Property Investor · Lapeer, MI · Member since 2019 · 57 posts · 118 votes
    5y

    @George W. Yup. That's what I've done & it's been more profitable + peace of mind.

    1Reply
  • Dustin Letourneau
    Louisville, KY · Member since 2015 · 19 posts · 11 votes
    5y

    Following this story.  Love your energy and push to your goal.  As someone just starting the journey there is so much information, even in just this one post!  Keep grinding!

    1Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Thank you Dustin! Keep moving forward and hustling.  I'll try to post my progress as I can.

    This can be part of my 30 and 60 day challenge to keep me accountable.

    Working on the take no prisoners mentality.  A good book to read about this is Robert Greene's The 50th Law.  

    1Reply
  • Paul Shannon
    Rental Property Investor · Fishers, IN · Member since 2016 · 335 posts · 470 votes
    5y


    @Tri Le

    There are definite opportunities in the midwest for mid-sized, value-add projects.  We just acquired a 40-unit in Evansville, IN that we are starting rehab/reposition on today.  Most difficult piece to figure out with these types of properties is the management.  Too small for on-site, institutional quality management.  So you've gotta do it yourself or hire a local 3rd party company.  Both of which have challenges, respectively.  Challenges you can solve are opportunities, though.  

    DM me.  Would welcome connecting.  

    3Reply
  • Mark Whetstine
    Member since 2019 · 2 posts · 1 vote
    5y

    @Paul Shannon

    I'm interested in learning more about your project here in my hometown. We own, operate and manage a local SFR portfolio and are looking for growth opportunities daily.

    1Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    Hi Paul and Evan,

    Paul, this is great insight! It would definitely be a dealbreaker if I could not find someone to manage the apartment. My goal is to account for property management as an expense calculation towards my NOI. A man has to have time for college football and his fiance. We can debate the order :-).

    Evan, if you are in Cincinnati, DM me, and we can talk more. 

    24 hours into the challenge, and the motivation has not wavered!  Thank you BP!

    1Reply
  • Tri Le
    OP
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 37 posts · 46 votes
    5y

    This is my first draft on my 30 day plan/checklist.  I'm sure it's amateurish, but it's my 1st crack.

    Let me know what you think, but be kind :-)

    3Reply
  • Nahid AlipourPro Member
    Rental Property Investor · Irvine, CA · Member since 2015 · 16 posts · 4 votes
    5y

    @Michael Plaks Thank you Michael..I for sure contact her. Thank you..

    0Reply
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