By way of introduction, my name is Andrew D Reyes. I am a NYS CPA/Tax Consultant at a Big 4 accounting firm in NYC. I work exclusively in the Real Estate Industry currently and I am looking to start investing in Core+/Value-Add residential properties in the NYC Metro area.
From listening to the BP podcasts and reading books/articles, I believe that C+/B- properties near growing cities would be the best target for my goal of generating passive income and building wealth through capital appreciation.
I have limited funds currently, but may be able to raise cash from friends/family if I find a deal.
A few questions to this group:
1. Any suggestions for target markets?
2. Any suggestions for brokers/property managers/contractors in NY, CT, NJ, or PA? Any other states I should consider?
3. Any deals you recently closed or are working on currently that you are willing to share the details? I am looking to analyse more deals.
Any other suggestions or like-minded individuals looking to connect, please reach out or reply to this post.
My first question would be:
What are your goals? I understand that you are looking for rentals, but do you know what your cash on cash returns and ROI % minimums would be at? Like no less than $300 per month minimum positive cash return and no less than 8% ROI as an example... Also, number of units you want to acquire year 1, by year 5, by year 10?
Most people throw out a wide net and then have a hard time finding anything.
Do you want to look for single family, duplexes, 5 family and above, mixed use?
Do you plan to do any rehab on your own or hire people?
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Ditto @Christoper Phillips. There's a lot you need to answer @Andrew Reyes before anyone can give specific guidance. If you were looking in the 5 boroughs, for a cash flowing property, I'd say look for multifamily (3-4 family) buildings in outer Queens or parts of the Bronx. Be aware that the cost basis versus income potential of most properties will likely require you to keep your LTV below 65-70%.
Regarding cash-on-cash (and depending on your goals) I would say be careful about getting too wrapped up in that number. 1) it changes year on year and 2) it is far less important in most cases than other factors, and the totality of the investment picture OVER TIME. Remember that your total ROI will be the cumulative sum of your pay-down equity, accumulated market appreciation, forced equity (improvement) and accumulated cash flow. The effect of those 4 things together is far more powerful than your 1st year cash-on-cash, and focusing on cash-on-cash can often seduce you into an investment that is riskier and returns less over time, or conversely, make you pass over a great opportunity.
I have a very similar background like you. Worked in Real Estate audit for a Mid Size firm, but now have my own boutique tax and accounting practice as well as a job in finance company.
So be honest NYC market is tough, prices are though the roof.
I'm looking in NYC too but now started looking in PA. In looking specifically in Reading PA.
Good luck and feel free to reach out to me, we might be able to meet up in the city for coffee.
Ahad Ali, CPA
Welcome to BP @Andrew Reyes ! It's great you've got the vernacular down to know what class you're looking at and what type of city though you'll definitely want to narrow down your market. You need to do some personal research to determine what markets fit your interests, where you think you can build a team to your satisfaction etc. Your job likely is going to command a good deal of your time so the quality of your team will be paramount. Someone might tell you to invest in Indy but does their own property management full time. That doesn't help you if you need somewhere with top notch property management to operate on your behalf and can't find it there. Either spend some time developing quality relationships to build a team that helps you determine your market or spend some time to determine a market that really appeals to you and see if you can build a team there to your satisfaction. Best of luck!
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@Andrew Reyes Andrew, I live in NYC and I'm an investor also, would be willing to meet and discuss what I'm currently doing and perhaps there will be a synergy?
Message me if you'd like to discuss?
Hi @Andrew Reyes Welcome to BiggerPockets. Your belief of targeting "C+/B- properties near growing cities" is right on target. You may find markets where the buy-in and ROI is more conducive that other major metropolitan areas. Pittsburgh PA is one of those markets. Big businesses like Google, Uber, Apple, Facebook and Autodesk..even ARGO AI from Ford..have paved the way for Pittsburgh's tech makeover fueled by CMU's robotic, sciences and technological innovations. This has made Pittsburgh younger and more international, and has helped once neglected neighborhoods like Lawrenceville and East Liberty transform into tech hubs. Pittsburgh is also one of the top cities in the running for Amazon's HQ2 which could bring up to 50,000 additional jobs to the area. So anytime you see things like this happen, that's a city on the rise. As jobs are created with an in-flux of people, so does the need for housing increase. And I wish you the best as build your REI portfolio....Thanks, Gary
@Andrew Reyes Welcome to bigger pockets Andrew. I work in Manhattan and network with other folks in Manhattan area. Before partnering up with anyone... do your due diligence... there are many folks who will promise you the world...
I recommend attend several meet up meetings before diving into anything and taking a recommendation from everyone with the grain of salt.
Everyone will pull you in different directions... idea is to find focus. I live in CT work in Manhattan, I am doing research in the field of the commercial real estate multi-family housing and documenting it in my journey.
One thing I learned so far... in my journey... listening to podcasts.. is one thing... taking action is another.
Thank you all for the advice and thoughtful responses.
@Christopher Phillips and @daniel akerman I agree that I have a lot to do in order to fine tune my strategy. I also know that I have a lot to learn about owning a property. For this reason my current finance related goal is to close on a property that produces positive cash flow and upside potential. Based on the responses I got, some folks are looking to PA for this. Have you sold any properties lately that fit this broad net that you might be able to share that I can analyze to fine tune my desired metrics? I understand that all of the financial metrics you mention could vary depending on the market the property is in.
@Paul LaSpina and @Ahad Ali I would greatly appreciate the opportunity to connect at some point soon.
@odie ayaga I agree that my team will most likely be my most important asset. You sound well informed on the matter. Would you be able to connect offline to discuss your approach further?
@gary swank thank you for the recommendation to look into Pittsburgh.
Hey Andrew congrats on your new passion of real estate investing. You have many questions to answer and I'll do my best to help you through this.
1. I'm a NYC commercial broker and would love to facilitate your acquisitions in NY however, NJ is the better bet to invest RIGHT NOW moving forward into the future. NY prices are to high, cap rates are too low, tenants have too many liberties, and when the market finally corrects the property you just invested in will no longer be as valuable. If you need help finding property in or outside of NY I can still help you.
2. Brokers- Brandon Raeburn of Digiulio Group Real Estate. I am also a licensed contractor within NY. And I can quickly find qualified and experienced property managers for you in any area. I also have extensive contacts with private bankers and private lenders who'll give you favorable loans to build your investment portfolio.
3. In 2017 I did 2-3 deals a month in South Florida buying and selling SFR. After relocating back to NY in Nov I have been exclusively dealing with commercial apartment buildings. Fundamentally, MF investing is the best form of investing. Pay less in property management fees when all your doors are within one location. Deals I'm personally working on is a 76 unit $5 million property out in North Carolina. Fully raised funds with 9.67% annual cash yield, 8% preferred returns and a 14.24% IRR on a 5 year holding period.
Please if you have any questions or would like to meet for coffee please connect through private msg.
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