All Forum Posts by: Abel Sng

@Scott Skinger happy to see you're starting to analyze deals and taking action! A resource that many new MF investors don't take enough advantage of is partnering with an experienced property management company. They can easily knock out a lot of these questions for you. Most likely you will be using one anyways if you're up in the 75+ range. They will have intimate knowledge of the area and be able to compare this prop against other props in their portfolio.

This is where your relationship building hat will be important to establish repertoire for them to view you as a potential client and not just a tire kicker.

As for college, neither good or bad. Just know if you try to get agency debt, they will not lend on a property with a heavy student concentration on the rent roll.

Good luck!

@Gino Barbaro amen. Listened to y'all's BP podcast and y'all are a hoot! Seem like fun guys to be around.

I think you have a good set up. Most people try to do everything and in the end do nothing well. Crazy how little qualifications it takes now a days to be a "guru" or to be paid to "mentor" someone.

@Dennis Johnson if you want to send over your underwriting I can give you a second set of eyes. We have almost 700 units over 4 properties in ATL so I am pretty familiar with the market. If this is your first MF deal, you want to make sure the #'s make sense first before you get under contract.

Cheers!

@Jorge De Jesus all of the above. Put yourself in your potential investors' shoes. How much would you invest with you with your current experience, skill set, and balance sheet? $5k? $50k? $100k? Be honest with yourself. What would it take for you to invest that much money with someone?

The great thing is that all the qualifications needed isn't set in stone and are able to be gained but can take time. MF is not a race like SFH, it's a marathon.

Also, there is a huge difference between "hacking a 4-plex" and a 100+ unit syndication. Each will require a different level of "qualifications."

Good luck and as long as you take action you'll make it!

@Steve Vaughan off-market in this case means that the broker is marketing the property on a one-on-one basis. They are not blasting the listing to their entire rolodex. Most of the time these deals have hairs on them or the seller is not super motivated to sell unless the broker can bring them an attractive buyer at their strike price.

Since everyone's situation is different... here's one of the best rent vs. buy calcs I've found out there.

https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html

@Dave Homyak dividing in $50k bundles is a great way to diversify and spread risk. Especially across different markets and different sponsors.

Good luck!

Why would you need a broker at this point? Do you have a RE contract atty? Have him draft up a PSA with terms you agree with and now the real party starts.

Good luck!

A large shift in mindset is required for those who desire to transition into large MF investing.

1. What I love about MF is that it's a team sport. It's pretty rare for someone to have the capital, relationships, acumen, and skill set necessary to go it alone. You might be able to do it in wholesaling or fix and flips but not likely if you're trying to transact in the 100+ unit space.

2. MF is not passive if you're a sponsor. It's a business and should be treated like one. You are managing properties that generate millions of dollars in revenue. Would you invest in a company if you knew the CEO was running the business part time as a "side hustle" while employed somewhere else?

3. You have to pay to play in MF. How many of you have/would put up $200k hard day one? That's the world MF sponsors live in. There was a deal last year that we submitted an LOI on where a buyer put up $1M hard day one.

That being said $100k is not trivial but if your goal is to sponsor 100+ unit MF deals then use it to parlay that into a relationship with a sponsors that have good track records, invest in their deals, gain access to how they think, learn from them, and make money at the same time. This will give you insight on whether this business is a good fit or not.

Good luck!

@Hoa Nguyen are you a passive investor yet in any syndications? If not, that's a good way to get your feet wet. I would split up the $100k and invest in two separate deals if you can. This will give you access to see how different sponsors manage their assets.

One thing to keep in mind is that the track record of the sponsor is just as important if not more than the projected returns they are offering. It can be tempting to jump into deals based on the returns alone as a first time investor.

I'm located in DFW and happy to hope on a call or grab coffee sometime and answer any questions that I can! Just shoot me a DM.

Good luck!