Commercial Real Estate Investing

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Cee Williams
  • Brooklyn, NY
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50+ units without being rich or partnering?

Cee Williams
  • Brooklyn, NY
Posted May 15 2022, 21:40

Is it possible to acquire a 10+unit property (cash flowing) with $100k savings, a six figure salaried job, good credit but no assets nor cosigner?

I keep hearing in these BiggerPockets videos that these guys are acquiring 50+ units and saying "hey, you can do it too!" but how do you actually do this if you're not rich, don't have rich friends to partner with, etc.?

Am I missing something or are the videos misleading and not giving us the details? I've watched dozens of these videos over the years and still don't seem to get the answer how to move to the bigger properties with more doors. Anyone have any solid insight on this? 

New York City, New York

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Kushaal Malde
  • Lender
  • Redwood City, CA
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Kushaal Malde
  • Lender
  • Redwood City, CA
Replied May 15 2022, 23:04

Why not? Depends on each deal - who is the seller and is there a lender and will that lender approve? Can the seller finance?

Most traditional lenders will want to see track record or balance sheet. In fact, track record holds so much weight, some times you need not bring any of your money into a deal. 

I think for a first time buyer with your profile, looking for a stabilized property is more appropriate than looking for a value add property. My assumption here is that your time is better spent at your salaried job and you're looking for extra cash flow (stable) instead of another job. Please correct me if I am wrong

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Cee Williams
  • Brooklyn, NY
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Cee Williams
  • Brooklyn, NY
Replied May 16 2022, 04:09

This is news to me. Every commercial and hard money lender I spoke with wants atleast 15%-30% down. Some are even asking for additional savings or assets as collateral. 

The properties I've found seller doesn't want to finance. Lender will approve if I have 20%. Some lenders are even asking that I have 2 years of experience dealing with tenants, and if not I need to bring on a partner who does. 

Yes, first time buyer here. Stabilized or cash flow property is fine for now until I work up. I need to get my foot in the door. I'm fine with staying at my salaried job while working on this. Totally fine with a potential property becoming a "second job" as I find this enjoyable to be honest. 

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H. Jack Miller
  • Lender
  • Delray Beach, FL
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H. Jack Miller
  • Lender
  • Delray Beach, FL
Replied May 16 2022, 06:00

If its a good enough deal, you can get it done. I don't think I can self promote on here. But we do JV equity deals all the time where we put up the debt and the equity. It really all comes down to the deal

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Ryan Howell
  • Rental Property Investor
  • Hendersonville, NC
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Ryan Howell
  • Rental Property Investor
  • Hendersonville, NC
Replied May 16 2022, 06:50

@Cee Williams - It will be difficult. Most likely at that size property you need to carry personal liability which means you need assets. Most lenders want to see experience. Can it be done? Yes. Seller financing and getting creative, you can make this happen. My suggestion is to consider starting smaller...buy 1-4 units that is a good deal and start growing your net worth. Do that a couple times and you'll start looking more attractive to the bank. I did 6-7 BRRRR deals before I went beyond a 5 unit building. 6-7 good deals can build your assets quicker than you think and give you a lot of experience that banks will like. It begins to snowball quickly.

Real Estate Agent North Carolina (#317060)

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Cee Williams
  • Brooklyn, NY
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Cee Williams
  • Brooklyn, NY
Replied May 16 2022, 07:22
Quote from @Ryan Howell:

@Cee Williams - It will be difficult. Most likely at that size property you need to carry personal liability which means you need assets. Most lenders want to see experience. Can it be done? Yes. Seller financing and getting creative, you can make this happen. My suggestion is to consider starting smaller...buy 1-4 units that is a good deal and start growing your net worth. Do that a couple times and you'll start looking more attractive to the bank. I did 6-7 BRRRR deals before I went beyond a 5 unit building. 6-7 good deals can build your assets quicker than you think and give you a lot of experience that banks will like. It begins to snowball quickly.


 Totally agree that the 6-7 units can build assets quicker. This is why I'm aiming for more than 4 units for the first purchase but encountering the down payment and experience issue. 

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Cee Williams
  • Brooklyn, NY
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Cee Williams
  • Brooklyn, NY
Replied May 16 2022, 07:23
Quote from @Kushaal Malde:

Why not? Depends on each deal - who is the seller and is there a lender and will that lender approve? Can the seller finance?

Most traditional lenders will want to see track record or balance sheet. In fact, track record holds so much weight, some times you need not bring any of your money into a deal. 

I think for a first time buyer with your profile, looking for a stabilized property is more appropriate than looking for a value add property. My assumption here is that your time is better spent at your salaried job and you're looking for extra cash flow (stable) instead of another job. Please correct me if I am wrong

This is news to me. Every commercial and hard money lender I spoke with wants atleast 15%-30% down. Some are even asking for additional savings or assets as collateral.

The properties I've found seller doesn't want to finance. Lender will approve if I have 20%. Some lenders are even asking that I have 2 years of experience dealing with tenants, and if not I need to bring on a partner who does.

Yes, first time buyer here. Stabilized or cash flow property is fine for now until I work up. I need to get my foot in the door. I'm fine with staying at my salaried job while working on this. Totally fine with a potential property becoming a "second job" as I find this enjoyable to be honest.

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Cee Williams
  • Brooklyn, NY
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Cee Williams
  • Brooklyn, NY
Replied May 16 2022, 07:26
Quote from @Jack Miller:

If its a good enough deal, you can get it done. I don't think I can self promote on here. But we do JV equity deals all the time where we put up the debt and the equity. It really all comes down to the deal


 Sounds like we need to talk. It's NYC so the deal is reasonable given the location. What are typically the terms and rate of this type of financing? 

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Ronald Rohde#4 Commercial Real Estate Investing Contributor
  • Attorney
  • Dallas, TX
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Ronald Rohde#4 Commercial Real Estate Investing Contributor
  • Attorney
  • Dallas, TX
Replied May 16 2022, 09:47

If its a good deal, you can find partners. But yes, in short, commercial real estate is not cheap. It takes capital to enter the market.

Either partner or build your own equity first.

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Mike Dymski
  • Investor
  • Greenville, SC
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Mike Dymski
  • Investor
  • Greenville, SC
Replied May 16 2022, 19:21

Get rich and get rich friends/investors...that's how you do it.  For real.  You either build your portfolio with your personal savings or you network and build it with other people's money (or some combination).  $100k may not get you in a 10-unit building but it will definitely get you in the game and it can grow from there.  Adding value can allow you to scale faster.

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Mohammed Rahman
  • Realtor
  • New York, NY
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Mohammed Rahman
  • Realtor
  • New York, NY
Replied May 17 2022, 05:27

I agree completely with @Mike Dymski - we hear a lot about how the rare few have been able to acquire a building with '$0 down out of pocket' and other click-bait titles, but at the end of the day we have to work our way up to bigger deals. 

What I've noticed is after I acquired my first couple of properties, and I was more intentional about investing in real estate, I started networking more openly with other real estate professionals/investors. One conversation leads to two, leads to a friendship, leads to analyzing deals and partnering up together, etc. 

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Jay Hinrichs#3 Starting Out Contributor
  • Real Estate Broker
  • Lake Oswego OR Summerlin, NV
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Jay Hinrichs#3 Starting Out Contributor
  • Real Estate Broker
  • Lake Oswego OR Summerlin, NV
Replied May 17 2022, 06:02

the Formula I have personally seen work when starting small  100k  by your self no partners is:

1. take the first steps

2. buy in a market that actually appreciates significantly over the shortest period of time.

3. Appreciation is where its at  .  cash flow holds the asset appreciation lets you scale.

4. once the first one appreciates signficantly sell 1031 and buy bigger

5 . Rinse repeat.

I used to compete with and partner with ( on courthouse foreclosures) with a mom and her daughter here in Portland and that is how they did it took 20 years. 

but they started with a simple duplex sold that got a 4 plex sold that and bought a 12 unit sold that got a 25 unit sold that bought a 80 unit sold that bought a 350 unit in OKC

now that OKC purchase was solid C class looked great on paper but they ended up moving there as the property was in danger of going in foreclosure the on site PM's stealing from them tenants not paying etc etc.. they then sold that once we had this run up about 5 years ago and came back to PDX paid cash for a 20 unit bought a condo on Maui  again all cash and called it a day this over the course of 25 plus years..   this sort of thing. you NOT going to do it if your property does not appreciate over time significantly.. If it does not you need to be making big bucks somewhere else so you can add equity to scale your rental business.

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Greg Henderson
  • Flipper/Rehabber
  • Hattiesburg, MS
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Greg Henderson
  • Flipper/Rehabber
  • Hattiesburg, MS
Replied May 17 2022, 07:53

"Is it possible to acquire a 10+unit property (cash flowing) with $100k savings, a six figure salaried job, good credit but no assets nor cosigner?"

Very unlikely. You need a high net worth or a lot more cash than 100k and experience to get financing by yourself. The question I'd ask is why would you want to start like that? The reason so many start small is to learn what you can't from a podcast or book and then build a plan. If you started rich or with rich friends, then yeah go for it! If not, you're one bad decision from a six figure salaried job, terrible credit, and $0 in savings. If you just want to slam 100k down and hop aboard the good times express, someone is going to rob you.

Those that have made it always preach passive appreciation and that is the ultimate goal, but its slow. If you start with 100k, you want that to double in a year or two. Not double in 6-10 years. If you start with 5 million, doubling in 6-10 years with no effort is the ticket. I'm pushing forced appreciation because I started with far less than 100k. I value add +25% to each property I purchase. Look for ways to amplify your investment with more time and effort in the deal vs looking for a lottery ticket to turn 100k into retirement. Start with one SFH that needs work. You will be rewarded with experience and higher CoC returns.

or its always possible I'm an idiot and finding a golden ticket is where your effort should go.