Investor · Dallas, TX · Member since 2019 · 86 posts · 123 votes
I've made my career in raising private capital and deploying it unleveraged into C class rental properties and recently for the last 3 years into Mobile Home Parks. Very conservative model that typically pays 12-15% annually to my investors.
I am in the process of raising 5M capital currently for several mobile home parks and have already been turned away by several of my long term investors because they have either:
- taken a recent HUGE loss in the market (many had margin)
- generally terrified of the economy
I'm considering raising my return to the investor to boost it to over 16-20% but wonder if that will even do any good.
I've made my career in raising private capital and deploying it unleveraged into C class rental properties and recently for the last 3 years into Mobile Home Parks. Very conservative model that typically pays 12-15% annually to my investors.
I am in the process of raising 5M capital currently for several mobile home parks and have already been turned away by several of my long term investors because they have either:
- taken a recent HUGE loss in the market (many had margin)
- generally terrified of the economy
I'm considering raising my return to the investor to boost it to over 16-20% but wonder if that will even do any good.
Raising capital is all about relationships. You need to listen close and hear what your investors are telling you I would not recommend raising your returns to that level. You will signal desperation and skepticism and send the red flags flying. The higher the return you offer the less legitimate you appear. You are just going to need to be patient during this time. Continue to build relationships for when this is over. Keep pursuing deals and and sending opportunities to investors to invest when this is over. Some will join you now but the longer this goes the more cautious investors are going to get. You can always ask for owner financing with balloon in 12-24 months. Some sellers will be agreeable due to the environment especially if they are staring to loose rents from struggling tenants.
@Jarrod Pettit most investors are sitting on the sideline for the short term (1-3 months) while this gets sorted out. We'll have a better sense of the investing landscape after that time. Most brokers and lenders I know are putting new deals on hold. Doing a deal right now is like doing a concert performance with no mic, the front row might be able to hear your lyrics, but most of the audience will just hear noise.
I've made my career in raising private capital and deploying it unleveraged into C class rental properties and recently for the last 3 years into Mobile Home Parks. Very conservative model that typically pays 12-15% annually to my investors.
I am in the process of raising 5M capital currently for several mobile home parks and have already been turned away by several of my long term investors because they have either:
- taken a recent HUGE loss in the market (many had margin)
- generally terrified of the economy
I'm considering raising my return to the investor to boost it to over 16-20% but wonder if that will even do any good.
How are you going to simply increase the returns to 16-20% during a time like this? Why weren't you at these returns to begin with pre Covid-19?