Jumping from Residential to Commercial and How to Scale

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Jumping from Residential to Commercial and How to Scale

James Carter
Member since 2022 · 9 posts · 1 vote

My wife and I closed on our first true investment property. It was a four-plex that we financed with a VA loan as a primary residence. We are looking for other avenues to invest in and have considered commercial properties. We are trying to nose dive into real estate and make this a success. What are good ways to scale the business without having to wait a year just to move into another primary residence funded by another VA, FHA, or conventional loan? I've been looking into a DSCR loan option for buying larger apartment type properties, but also for commercial properties that are leasing to businesses. The properties that I'm currently looking at are selling between 2.5M - 3.9M. I'm leaving the military and I will not have a source of income for a while. My wife does work and receives a W-2, but does make more than 35k a year. Our current investment is $3,750 - $4,350 gross monthly income. How can we take off on this venture and make this a viable business?

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Paul MoorePro Member
Commercial Real Estate Fund Manager · Lynchburg, VA · Member since 2015 · 1k+ posts · 1k+ votes
4y

Hi @James Carter! Congratulations on your success so far! I am in my third decade as a real estate investor and I spent the first decade plus, in residential. I often wondered how to make the leap into commercial real estate. I did not know where the on-ramp was or who to trust. 

I ended up hiring a paid coach and I highly recommend you do that. A coaching plan and mastermind will give you opportunities to partner with people, learn a lot and accelerate your investment program. I just spoke with Kevin today at the Active Duty Passive Income Podcast. He was telling me that they have a program for people who want to do exactly what you are doing. They put together cohorts of a dozen or so investors, most of them from the military, and they learn together, grow together and do deals together. I highly recommend you check this out. Good luck and happy investing! 

Podcast Guest on Show #533
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  • Jim Pellerin
    Real Estate Consultant · USA · Member since 2014 · 1k+ posts · 751 votes
    4y
    Quote from @James Carter:

    My wife and I closed on our first true investment property. It was a four-plex that we financed with a VA loan as a primary residence. We are looking for other avenues to invest in and have considered commercial properties. We are trying to nose dive into real estate and make this a success. What are good ways to scale the business without having to wait a year just to move into another primary residence funded by another VA, FHA, or conventional loan? I've been looking into a DSCR loan option for buying larger apartment type properties, but also for commercial properties that are leasing to businesses. The properties that I'm currently looking at are selling between 2.5M - 3.9M. I'm leaving the military and I will not have a source of income for a while. My wife does work and receives a W-2, but does make more than 35k a year. Our current investment is $3,750 - $4,350 gross monthly income. How can we take off on this venture and make this a viable business?

     @James Carter I think you have to start looking beyond your own income. The best way to scale is to become a syndicator. You need to go out and raise funds from other people to fund an apartment building purchase. 

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  • James Carter
    OP
    Member since 2022 · 9 posts · 1 vote
    4y

    @Jim Pellerin Thank you for the response. I'm new to everything outside of buying primary residences. I will be looking into the information you shared to gain better insight. Is there any information on becoming a syndicator that you could provide that would help me in that direction?

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  • Jim Pellerin
    Real Estate Consultant · USA · Member since 2014 · 1k+ posts · 751 votes
    4y
    Quote from @James Carter:

    @Jim Pellerin Thank you for the response. I'm new to everything outside of buying primary residences. I will be looking into the information you shared to gain better insight. Is there any information on becoming a syndicator that you could provide that would help me in that direction?

     @James Carter It depends how you want to raise your funds. There are a lot of articles on the subject but here is one I found to get you started.

    https://www.appfolioinvestment...

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  • Paul MoorePro Member
    Commercial Real Estate Fund Manager · Lynchburg, VA · Member since 2015 · 1k+ posts · 1k+ votes
    4y

    Hi @James Carter! Congratulations on your success so far! I am in my third decade as a real estate investor and I spent the first decade plus, in residential. I often wondered how to make the leap into commercial real estate. I did not know where the on-ramp was or who to trust. 

    I ended up hiring a paid coach and I highly recommend you do that. A coaching plan and mastermind will give you opportunities to partner with people, learn a lot and accelerate your investment program. I just spoke with Kevin today at the Active Duty Passive Income Podcast. He was telling me that they have a program for people who want to do exactly what you are doing. They put together cohorts of a dozen or so investors, most of them from the military, and they learn together, grow together and do deals together. I highly recommend you check this out. Good luck and happy investing! 

    Podcast Guest on Show #533
    2Reply
  • James Carter
    OP
    Member since 2022 · 9 posts · 1 vote
    4y

    @Paul Moore thank you!

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