Rental Property Investor · Houston, TX · Member since 2019 · 87 posts · 69 votes
I have recently come across a 212 unit apartment complex in Houston. I’ve spoken briefly with the owner and he is considering selling the property. 212 units might be too big of a deal for me to do by myself at this moment, so I am seeking an investor who is able to do this deal in exchange for equity in the property and the opportunity to shadow them and learn from the process. How do I lock up a large deal like this so I can safely pitch it to other investors without them going over my head and snaking it from me?
I have recently come across a 212 unit apartment complex in Houston. I’ve spoken briefly with the owner and he is considering selling the property. 212 units might be too big of a deal for me to do by myself at this moment, so I am seeking an investor who is able to do this deal in exchange for equity in the property and the opportunity to shadow them and learn from the process. How do I lock up a large deal like this so I can safely pitch it to other investors without them going over my head and snaking it from me?
Thank you in advance!
First step is to get a number from the seller and all the pertinent information to support it. The key is the deal itself. The better the deal the better position you are to negotiate with a sponsor. Once you gather the info you can then put together a NDNC and start contacting investors. Make sure to disclose up front what you are looking for. Some may be willing to carve some equity as a funders fee others may only offer a fee.
I have recently come across a 212 unit apartment complex in Houston. I’ve spoken briefly with the owner and he is considering selling the property. 212 units might be too big of a deal for me to do by myself at this moment, so I am seeking an investor who is able to do this deal in exchange for equity in the property and the opportunity to shadow them and learn from the process. How do I lock up a large deal like this so I can safely pitch it to other investors without them going over my head and snaking it from me?
Thank you in advance!
First step is to get a number from the seller and all the pertinent information to support it. The key is the deal itself. The better the deal the better position you are to negotiate with a sponsor. Once you gather the info you can then put together a NDNC and start contacting investors. Make sure to disclose up front what you are looking for. Some may be willing to carve some equity as a funders fee others may only offer a fee.
Apartment Syndicator · Charleston, SC · Member since 2016 · 973 posts · 728 votes
5y
@Hayden Wright the best way would be to get the property under contract if you are a serious buyer. Then bring the opportunity to your network and figure out a way to partner with others to get it closed.
Rental Property Investor · Rochester, MN · Member since 2017 · 224 posts · 323 votes
5y
@Hayden Wright
I have a similar issue and these two guys also answered my question. Thank you @Greg Dickerson and @Danny Randazzo.
How does one go about getting a massive deal like mine or Hayden’s under contract? Will there be some expectation of proof of funds or a earnest money deposit? I wouldn’t be able to provide either. Or, what if we got the deals under contract, take them to a buyer and the buyer doesn’t like the price? Is there ability to renegotiate there? Asking the question here because Hayden may have a similar question.
Rental Property Investor · San Diego, CA · Member since 2014 · 1k+ posts · 2k+ votes
5y
Hi Hayden,
My team underwrites so many deals and 95% or greater don’t pan out on paper etc.. feel free to message me. I have been helping educate people on BP for a while now. I love this stuff. I have 238 units on my way to 1000 and live to talk shop!! I was a guest on BP podcast 238 and featured on the cover of BP’s new magazine too in this past Oct/Nov issue.
Real Estate Broker · Portland, OR · Member since 2019 · 4k+ posts · 2k+ votes
5y
How do I lock up a large deal like this so I can safely pitch it to other investors without them going over my head and snaking it from me?
I guess why would they work with you? You're going to have to show somehow you have an edge over anyone else. If you think you're the only guy talking to the owner, hate to tell you, but probably not. These guys get calls all day from brokers.
Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes
5y
Underwrite the deal and take it to a sponsor that (1) you trust and that (2) meets that sponsor's criteria. Forget about protection...and focus on adding value.
Rental Property Investor · Tallahassee, FL · Member since 2018 · 55 posts · 48 votes
5y
Hey Guys,
Seems like everyone has touched on ways to put it together and then bring it to investors, I would definitely second that you should be using a NDNC. But as Steve said this owner will be getting calls from brokers/other investors. What I would highly recommend is now that you have a potentially motivated seller, create a relationship. Call him a few times a week, make it casual, talk about things other than the deal. If you can create a relationship they may just let you have the last offer if they do get offers from others, or even better they may take your offer even though someone else came in higher or the broker told them they could sell it for them for much more. Relationships are everything and if you can get this seller to like you it may go a long way for getting this deal under contract.
Rental Property Investor · Houston, TX · Member since 2019 · 87 posts · 69 votes
5y
@Michael Swan thank you for taking the time to respond, Swanny! I have listened to your podcast every day this week on the way to and from work and have become fascinated with your story. I find it very encouraging to know that you were able to begin investing while on a teacher salary in one of the most expensive markets in the US. I too am on a salary similar to a first year teacher and have recently had some doubts in myself, but this podcast help turn me back around. Again, I really appreciate you reaching out and will definitely be speaking with you in the near future!
Investor · St Louis, MO · Member since 2017 · 250 posts · 181 votes
5y
@Hayden Wright this is why finding the deal AND finding the capital is important to do simultaneously. Next time you find a good deal that is worth pursuing, you will have the resources needed to close on the deal. For right now, I would get all the information that you can on the deal, and start pitching it to everyone you know. I wouldn't recommend using Earnest money to lock up the deal at this time.