A BiggerPockets $635,000 Joint Venture
For those of you who have been following me here on Bigger Pockets I'm sure you remember the $625,000 Joint Venture I blogged about a few months ago. If not please take a look at it Here
We recently closed on another deal pretty similar to that one.
This 21 unit apartment building is located on the west side of Cleveland Ohio.
- 9-2 bedroom units
- 12-1 bedroom units.
- 2 separate coin operated laundry rooms.
- Located on a main road right near the Parma/Old Brooklyn border.
- Storage Shed
The building brings in an average rental income of $10,895 per month.
We have a central boiler system so we are paying for water & heat. I expect this building to produce us an annual net return just over 10%.
We had partnered with a Bigger Pockets member. He put up $5,000 EM. Myself & my partner John(G.C.) performed inspections on the building. Everything was a go. Terms, splits etc.
Our partner had to pull out of the deal due another deal he was involved in. I spoke with my sellers & explained that one of my partners would be unable to complete the deal & at this point the deal is dead. I asked the sellers for a couple days to piece it back together. The sellers agreed to give me two days to put the deal back together before putting it back onto the open market.
I presented the deal to one of my biggest partners/clients @Chi Cheung We had met Chi on Bigger Pockets last year & have been busy building him a sizable rental portfolio in Cleveland consisting of single family homes, duplexes, & a small commercial complex. (Perhaps that's a blog for another day) I did blog about one of our first deals with him Here
Chi was interested in the deal. We were back on.
We ended up doing a 3 way split. HWPG taking 1/3 ownership, Chi taking 1/3 ownership & a friend of Chi's (Wing) who had came out to Cleveland with him last year took the other 1/3.
All three parties split cash flow/profits into equal 3rd's.
HWPG performs all property management duties at it's own cost.
Repair costs are split evenly between the owners & performed by HWPG
We assumed the mortgage of the sellers.
The remaining $134,627.11 was paid in cash at closing as follows.
HWPG-$10,770.17 & $12,245.00 After closing.
Passive cashflow. Have helped many Biggerpockets members invest in Cleveland Ohio Real Estate.
Can work with you in several ways.
-Rental Properties from the MLS-
-Secured Loans-24-84 month terms. We pay up to 12% APR-