Commercial Investing Without Syndication

[Royce Hodnett]

Hey, everyone!! I’m interested in hearing some stories about people investing in apartments of 5+ units without syndication. I’m pretty sure Jake & Gino started that way but would love to hear more stories about how people successfully invested in the beginning without syndicating. Thanks!!

[Brian Burke]

Mine was a 16 unit building that I bought with a 1031 exchange and some seller financing. 

I owned a SFR and a condo and sold both. The proceeds from both sales went to my exchange intermediary. Then I found this property through my broker.

The funds in my exchange weren’t enough for the down payment.  So my offer was bank financing for 70%, seller financing for 20%, and 10% down. 

After about 2 or 3 years I refinanced the property and not only lowered my interest rate but also got enough proceeds to pay off the seller loan. Now I had permanent financing with a 20 year amortization. I owned that building for 14 years and then exchanged out in another 1031. 

That was a great learning experience for me and taught me many lessons.  After doing a few more similar deals and a decade of experience I built the confidence to start syndicating deals. I wouldn’t have crossed the 2,000 unit mark this year if I hadn’t started with this one little 16-unit...