All Forum Posts by: Allen Meringolo

@Ryan Harwood - here is a map of the area with the most popular amenities.

After our next deal, my group will be going from two to seven units under management in Campton-Thornton area in NH. For this deal and any future deals we want to do, we are going to have to significantly increase operational infrastructure. 

So my thought is if we are doing this, we may as build an STR property management business. It would create a nice flywheel for our business.

I have tons of questions that I am trying to wrap my head around that I am hoping some folks who run such companies could help with:

• What exactly is your value proposition? What pain point are you solving for clients? 
• What is your pricing structure? Do you do any tiers for service levels or customizations for certain clients? What are the most effective marketing strategies?
• What exactly does onboarding a client look like?
• What do you bill clients for and what do you cover?
• What’s your tech stack?
• What does regular reporting look like? What frequency and what do you share?

Any input on any of these questions would be much appreciated and / or any folks who would be willing to chat in more detail for 30 minutes or an hour - more than happy to compensate for your time.

Few thoughts on this:

• These past two years might not be replicated at any point in the next few years b/c it was a confluence of factors that came together all at once (high savings, little international / airplane travel, a lot of time at home for many folks, lots of cheap money flowing into system)
• But to @Alex S.'s point "COVID accelerated a trend that was already growing." In addition to general preference to STRs, COVID accelerated remote work and baby boomers moving to scenic, rural areas
• Both of those trends I think are a boon for regional STR travel in the long-run and reason to be bullish
• Related to remote work, startups are now spending more on Airbnb than offices. 

I think the future is bright although even if macro trends are with you, real estate is a deal by deal game so run the numbers conversatively and see if they work. 

Thanks for the reply, @Alex S. May check out Raising Private Capital, appreciate the reccomendation on that. 

Good point on the backup strategy. The deal we are looking at marginally works at long-term but thankfully is zoned commercial and the town we are has STR by right in all zones so I feel comfortable.

Great question and one I am trying to work through myself. 

In terms of bank / lender, it seems like there is not a clear answer on this and varies lender to lender. 

I asked my commercial loan officer about a BRRRR-type strategy with STR and he said they would want to see 2 years of NOI before they would be willing to make a loan based on income. And that makes the economics of hard money loans a bit untenable.

And when you mention investors, I assume you mean in terms of exit? I think you will have to find a buyer whose strategy is STRs thus knows how to underwrite an STR deal in which case I think STR NOI would qualify.

Hi - my name is Allen Meringolo; I am apart of a group called Pothos Capital that owns and operates STRs in southern White Mountains of NH. My group is syndicating money for our next deal.  

Has anyone else here syndicated for STR? If so, a few questions for you:

1. What is your overall strategy? Buy and hold?  
2. How do you think about your exit strategy if you have one? Who is buying your property?
3. How do you think about regulatory risk?
4. Do you go big on renovations and value add? Say bigger than you might on a traditional MFH investment? 

In general, would love to connect with anyone who has gone through this process. Thanks in advance. 

I am currently looking at lots of automation tools, including accounting, so I'm happy I stumbled upon this thread!

@Joshua Strickland - would you mind sharing more about your experience with Stessa? What have you liked? What have you disliked? 

@Adam Hamilton - how does REI differ from Stessa? Do you have any particular features that are valuable for STR investors?

@Charlie Moore I personally take AirDNA data with a grain of salt. Couple issues:

• In popular vacation areas, you have lots of repeat renters who go back to the same place every year and work off platform
• Similarly - if you have someone who is staying for multiple weeks / months, the owner might take a part of the transaction off AirDNA
• Some people only put their house on Airbnb a few weeks a year (AirDNA notes this) but could still throw off their aggregate ADR and occupancy numbers

A way you can use AirDNA and supplment with your own analysis - use their map feature to grab what look like the five most comparable listings, look at the aggregate data they provide, and also go their actual listing and pick like 5-8 times of year that represent a solid cross section of seasonality (a weekend in the Fall, July 4th, random weekend in February, Thanksgiving, etc) and see what folks are listing for. Maybe you discount that rate 10% b/c it hasn't been booked and then you can weight those times of year according to however representative you think they are. Combine that with aggregate Airdna data and you have something a bit more dynamic.  

Also in regards to influx of supply, I don't necessarily see that as a bad thing so long as demand is somewhat keeping pace. In a crowded market, quality wins so just gets of 5 star reviews and repeat guests.