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Mike Bator
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Why aren't real estate investors proactive?

Mike Bator
Posted Feb 17 2024, 04:54

I'm genuinely curious – why aren't real estate investors proactive? For instance, with STRs, why won't an investor spend an hour on AirBNB for their area to identify listings that:
1) rank the highest
2) occupancy 95%+
3) ADR $750+
4) hosts have 2+ properties
5) listings are branded with 20k+ Instagram followers
etc

Then, reach out to those top operators; as many don't have the time or gave up on cold outreach, yet they've done the hardest 90%, have skin in the game, and outcompeted thousands of listings nearby.

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Jay Hinrichs#1 All Forums Contributor
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Jay Hinrichs#1 All Forums Contributor
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Replied Feb 17 2024, 05:28
how do you find the owners ?  do they post their personal phone numbers on A BNB ? and are they going to share all their secrets.  in addition not every investor wants to get into the lodging business. I know i tried for a few months and no thank you..

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V.G Jason
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V.G Jason
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Replied Feb 17 2024, 06:09
Quote from @Mike Bator:

I'm genuinely curious – why aren't real estate investors proactive? For instance, with STRs, why won't an investor spend an hour on AirBNB for their area to identify listings that:
1) rank the highest
2) occupancy 95%+
3) ADR $750+
4) hosts have 2+ properties
5) listings are branded with 20k+ Instagram followers
etc

Then, reach out to those top operators; as many don't have the time or gave up on cold outreach, yet they've done the hardest 90%, have skin in the game, and outcompeted thousands of listings nearby.

 Pause.

This new era would rather buy into a guru, a program, an app, or anything in between or something similar to do this work for them. This isn't STR, this is any form of investing or daily work(non REI related). As bad as that sounds, the other side is you have people selling things like STRs are recession proof. So it goes both ways.

To say some have not done that would be wrong. I've done that in 2-3 of the spots I have STRs in, with that said it made me learn some different areas I needed to protect myself in once I got in contact with the operators. 

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Robin Simon#1 Classifieds Contributor
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Robin Simon#1 Classifieds Contributor
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Replied Feb 17 2024, 08:26
Quote from @Mike Bator:

I'm genuinely curious – why aren't real estate investors proactive? For instance, with STRs, why won't an investor spend an hour on AirBNB for their area to identify listings that:
1) rank the highest
2) occupancy 95%+
3) ADR $750+
4) hosts have 2+ properties
5) listings are branded with 20k+ Instagram followers
etc

Then, reach out to those top operators; as many don't have the time or gave up on cold outreach, yet they've done the hardest 90%, have skin in the game, and outcompeted thousands of listings nearby.


 First of all - most people (including real estate investors) are lazy and will always gravitate towards promises of quick returns / passive income promises.

But also - what you are describing is something that AirDNA does extremely well and automated - it can be a little pricy, but way way more effective and accurate to do this with that tool - highly recommended

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Conrad Legé
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Conrad Legé
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Replied Feb 17 2024, 08:40
Quote from @Mike Bator:

I'm genuinely curious – why aren't real estate investors proactive? For instance, with STRs, why won't an investor spend an hour on AirBNB for their area to identify listings that:
1) rank the highest
2) occupancy 95%+
3) ADR $750+
4) hosts have 2+ properties
5) listings are branded with 20k+ Instagram followers
etc

Then, reach out to those top operators; as many don't have the time or gave up on cold outreach, yet they've done the hardest 90%, have skin in the game, and outcompeted thousands of listings nearby.


Agree, however you can’t reach out to the operators via Airbnb. That’s considered soliciting and can get your listing/profile removed. 

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Mike Bator
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Mike Bator
Replied Feb 17 2024, 12:53
Quote from @Jay Hinrichs:
how do you find the owners ?  do they post their personal phone numbers on A BNB ? and are they going to share all their secrets.  in addition not every investor wants to get into the lodging business. I know i tried for a few months and no thank you..

Since having a "brand" and an "Instagram" presence is fifth on my list, owner-operators can be reached through their website, social media, etc. Their guests do this all the time to save on AirBNB fees and book directly. There isn't a need to message through AirBNB at any point.

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Jay Hinrichs#1 All Forums Contributor
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Jay Hinrichs#1 All Forums Contributor
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Replied Feb 17 2024, 13:06
Quote from @Mike Bator:
Quote from @Jay Hinrichs:
how do you find the owners ?  do they post their personal phone numbers on A BNB ? and are they going to share all their secrets.  in addition not every investor wants to get into the lodging business. I know i tried for a few months and no thank you..

Since having a "brand" and an "Instagram" presence is fifth on my list, owner-operators can be reached through their website, social media, etc. Their guests do this all the time to save on AirBNB fees and book directly. There isn't a need to message through AirBNB at any point.


well I dont see where they post their website on air bnb  and I dont have instra gram or know how that works. so to me they are quite anonymous.. I only use Airbnb as a last resort. so not really anything I look at more than maybe once a year for a fishing cabin.

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Chris Seveney
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Chris Seveney
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Replied Feb 17 2024, 14:00

@Mike Bator the good ones are, but just like in a baseball, there are those who are proactive and excellent at it just most of us play in a beer league on the weekend

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Aditya S.
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Aditya S.
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Replied Feb 22 2024, 11:57

Reach out to them to do what?

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Mike Bator
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Mike Bator
Replied Feb 23 2024, 14:16
Quote from @Aditya S.:

Reach out to them to do what?


I was mainly referring to providing equity-based financing to those top operators to scale from 2+ to 100+ more quickly. Like VCs do all the time in Silicon Valley. Considering the figures of 95% occupancy and $750/night, it's akin to a software business having 2+ customers on a $21,500/month subscription EACH.


Unlike software startups, real estate offers "easy" bank loans, so each dollar invested effectively becomes $2-4. With the numbers provided, such STRs operate at 50%-60% margins like software companies. So, with some cash for fuel and board-seat-like guidance - oh boy.

Seed-stage startups in Silicon Valley have an average valuation of $10m, a 90% failure rate, and are often unprofitable for many years while hoping for the next round. All that valuation is based on some basic MVP, yet VCs are okay with it since they only need one out of a hundred to achieve a 100x return to make it all worth it. Then, they double down on winners in Series A, B, etc. I might be wrong, but it seems that many in real estate failing to learn from Silicon Valley's success. Everyone is looking for a short-sighted win of getting a monthly dividend or payout, instead of becoming deeply involved to help the company 100x the revenue in 5-8yrs while maintaining 50-60% margins. With 100 properties at those margins, the public markets would assign a 10x multiple on revenue, equaling a $258m valuation (100 properties * $21,500/month * 12 months * 10x). In any case, perhaps I'm just wrong and don't know it yet.