Best Way to Break Into Apartments After 20+ Years in SFR?

Question

I’ve been in real estate since 2002, owning and self-managing SFRs. My team and I handle all rehab and maintenance in-house, keeping costs 40–50% below market. I’m now shifting into apartments — looking for mismanaged or value-add deals where I can force NOI growth through efficient operations and reduced expenses.

• Buy a 20–40 unit on my own
• Partner with a multifamily GP
• Raise private capital

Question:
What’s the best way for someone with deep ops/rehab experience but no MF resume to get into apartments without giving up too much control?

Arn Cenedella · Answer

@Chris Howell

Excellent being able to bring down a $2M with your own capital and perhaps up to $5M with partners.

Two thoughts:

1. Whatever capital you think you can raise cut it in half.

In my experience helping new operators get into syndications, the first capital raise often falls so short of expectations.

2. Based on your capital etc I’d suggest look for $2M to $5M deals.

If you find a great $2M buy it for yourself.

If you find a larger great deal, bring in lrtners.

Gives you options.

Denise Supplee · Answer

Hi @Chris Howell nice to meet you here on BP! You're in a great position with your ops and rehab background! To break into multifamily without giving up too much control, consider buying a small 20–40 unit solo or JV with one trusted partner, that builds your MF resume fast. You could also co-GP on a deal where your operational value justifies a meaningful equity stake. Raising private capital for your own deal is also solid, especially if you can show a clear path to boosting NOI. Start small, prove the model, then scale!

Deon White · Answer

@Chris Howell

Hey Chris, as mentioned, partnership is a powerful strategy. It can increase 1:1 returns to 1:1.X returns (if that makes sense). Partnering can increase upside disproportionately because you can look at larger deals that fewer people feel comfortable attempting.

My team is also in the process of scaling with partners, feel free to message me sometime if you'd like to talk through the concept.

Chris Howell · Answer

@Denise Supplee

I would love to ask you a few questions about you investment group.  If you can message me that would be great.

Thanks

David Briscoe · Answer

Nice meeting you....dm me. I have an excellent idea on how.

Allan C. · Answer

If you can get into 20-40 units on your own, why would you want to take on partners? Yes you can increase NOI, but you're giving up equity, which comes with partnership risk down the line.

partnerships are good if partners are bringing something to the table. I would question your motivation to find a capital partner just to get into larger assets. As you get beyond 50 units you're competing against other folks with deep pockets, so they're likely to be as sophisticated as you are.

Chris Howell · Answer

You’re right — I’ve built my portfolio solo and can still take down 20–40 unit deal on my own. But my long-term goal is to build generational wealth, and doing that one smaller property at a time is slow. I’m bringing in partners not out of necessity, but because it lets me scale faster, take down bigger assets, and multiply the impact of what I’m already doing.

I don’t mind giving up some equity — because if I make my investors happy, they’ll keep coming back. Money follows money. That momentum lets me grow at a pace that would take 2or 3 timed as long if I did everything solo. And with my edge in operations and rehab — consistently 40–50% below market — there’s still plenty of upside left for everyone.

I’m looking to bring in investors to help me scale quicker, (so i believe they are bringing something to the table especially on my first deal)  while offering them double-digit returns secured by income-producing real estate. It’s a win-win — I grow the portfolio, and they get strong, steady returns without the burden of management.”

I still might go solo but none of the smaller 20 to 40 units ive found in my area make sense to invest in at the moment where as there have been some larger ones that make complete since with margins being terrible and bleeding cash from contract labor  and repair cost of goods.

love the question helps strengthen my beliefs and structure explaining my reasoning!

Chris Howell · Answer

@Arn Cenedella

thanks for your feedback and advice.  I have started doing some of the things you recommended.   I feel comfortable that I could do 1.5 million to 2 million deal on my own without outside capital but would like to scale a little faster so figure on bringing in limited partners to go after a 2.5 to 5 million project that meets my specific requirements to increase noi.

Arn Cenedella · Answer

@Chris Howell

First let me say I think you have the necessary practical hands on experience in real estate to make the jump.

Far too often I see folks with pretty much no investing experience want to scale and buy a 150 unit apartment building. it’s crazy in my mind.

You have put in the time and paid your dues. 👍

If you don’t want to give up control, then you need to start small. It’s unlikely an experienced investor with $500K to invest will give a relative newbie MF person control. Not trying to offend just level set expectations.

Here’s how I would go about it.

1. Reach out to your personal and professional sphere - reach out to people you know and who know you. Reach out and let people know you are going to start buying MF properties. NO hard sell. Don’t ask for money. Just let them know. Interested parties will self identify themselves. “Hey I’d love to own some RE or MF but I don’t know how or have the time to find and operate them”. They will say “let me know if you find something good.” Just plant the seed.

2. Look for property you can actually buy. That’s realistic given your financial situation. Doubtful you can buy a $20M deal right out of the gate so don’t waste time looking at stuff you can’t buy.

I’d work backwards and calculate as follows:

How much capital can I personally invest?

Is it $50,000? $100,000? $250,000?

I’d go after properties where you could come up with a 1/4 to 1/2 the cash required AND then you’d only need 3 or 5 investors to make up the difference.

So it your amount was $250,000 then I would go after properties that you would need $1M cash to buy. This would mean maybe a $2M to $2.5M property.If not $250,000 adjust accordingly.

Keep talking to people as you look. Identify investor partners.

Get that first deal closed, run it well and deal number 2 will soon follow.

Good luck?

Best Way to Break Into Apartments After 20+ Years in SFR?

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