Syndicator of Large Apartment Buildings · Glen Mills, PA · Member since 2009 · 1k+ posts · 1k+ votes
I am happy to report that today I closed on a 240 unit apartment complex in Atlanta, GA that I bought for $9.4 million and it appraised for $9.9 million. Capital raise was $3 million and my investors are super excited!!
Congratulations! Would you mind sharing some details, rents, debt service how you put the deal together? Thanks in advance and great to see you getting deals done.
Congratulations Good for you and your investors , I am Atlanta area Investor would you be able the share the name of the apartment complex so i can study your numbers its good for me know what is worth.
Again Congratulations to you and your team and if you have any other deals which you are working i would love contribute financially.
Congrats! That is fantastic!! Can you please share what is your investment expectation from this deal. IOW, what kind of returns are you looking for? It is pretty clear this complex is located in a desirable area as occupancy without improvements is 93%
What is the expected profits for each investor per 50k unit? Eric, I would be happy to discuss this with you as an accredited investor as I don't feel comfortable disclosing profits/returns on a deal in a public forum like this. I hope you understand.
Also how is it paid out--quarterly yearly? Each deal is different, but most deals I have done payout quarterly.
great work Brian! What did the investor marketing/sales package look like? I'm hoping to do some syndication deals in the next 6-18 months in my market and see building one from my prior deals and current prospective deals to secure more investors. What would you suggest?
What did the investor marketing/sales package look like?
My pitch book has evolved over time, but the 3 things you need to answer for the investor are:
How much will the investor get
How will the investor get paid back
When will the investor get paid.
I have some investors who only want to know the high level view, so I include an executive summary of maybe 3 to 5 bullets explaining the opportunity.
For those wanting more details, I include financials, pictures, site map, floor plans, maps, info about the market, age of property, # of units, rent and sales comps, return projections, sources and uses, my bio, to name a few...
Coming at this from a slightly different angle as a newbie investor in the multifamily game who is starting to look at and analyze opportunities as they become available. As a syndicator, in general, do you disclose specifics beyond your top line selling points in your OM? For example, 97% current occupancy is a great top line selling point. However if it is 97% "occupied" but only 1/2 of the tenants are actually paying on time or at all, suddenly that 97% occupied status becomes more of an albatross than a true benefit. Is this deeper dive type of information the kind of thing that you, or most, would typically include in your OM or is it up to the potential investor to really think about these numbers and ask these types of specific questions? I'm just curious to know what the typical approach is as a lot of stuff that has come across my desk is very top line and all sunshine and roses. Great for rallying a lot of support, back slapping and atta' boys but, as a potential investor, I'd put a lot more stock in the operator that really dives into the nuts and bolts, pulls the veil back a little and gets ahead of my objections and concerns well before I think of them myself.
@Drew McLaren, are you sure you are a newbie investor? Great question!!
Yes occupancy is one thing. But what is more important and relevant is economic occupancy, those tenants that are actually paying rent.
When I put my pitch book together, I "bake" in more conservative numbers and as a CPA I love the nuts and bolts of numbers.
To share with you though, when I first started buying large apartment deals, I included in the package some amazing spreadsheets, graphs, charts, etc. and all about the numbers. Most of my investors would look at these reports and get completely data overloaded.
So what I do now is back-off including all the spreadsheets and things in the pitch book. For an investor who wants more, I have it ready and it is available upon request.
Plus, in the PPM (private placement memorandum) many risk factors need to be disclosed to the investor such as financial projections.
To summarize and at a high level view, the most important thing that you need to answer for the investor is how much they will get paid, when will they get paid, and when will they get their money back.