All Forum Posts by: Alan M.

I've heard GC on several podcasts. Here are my thoughts:

-You can tell he's a great speaker. He was a sales trainer (and a good one) before getting into capital. The guy never has a filler word, he's engaging and for sure entertaining.

-None of these qualities mean he puts together deals you should invest in. As others in this thread have referenced, his returns are far lower than other sponsors as is the portion of the deal that goes to investors.

-I promised myself I'd never invest with him when he said this on a podcast: "I know I'm going to invest in a deal before I even run the numbers." Wrong. Running numbers should have you running away from deals, not ignoring the numbers to still get the deal done.

You can learn a lot by listening, but you can also start to tell he does a LOT of things that no one should ever do, and makes up for it by having huge volume. 

Ashcroft is like this too....HUGE marketing arm, deals (especially recent ones) aren't all that attractive.

Agreed that something doesn't add up. Could be your spelling is throwing people off?

Nearly any real estate investment won't return 15% in cash, most would be in appreciation or debt paydown. Both of which are locked and not accessible unless you refinance or sell.

$25M? I think you meant $25k, no?

Really helpful perspective. I don't think I did a good job of framing the root of my question, but I think you savvy contributors got what I was trying to say. Much appreciated the perspectives!

Would love thoughts from @Todd Dexheimer, @Ivan Barratt, @Brian Burke, @Brian Adams, and @David Greene on this one

I've been looking to invest in some real estate syndication deals. I've met with 15+ sponsors, guys who do deep value adds (low if any initial cash flow in the first few years, but higher IRRs upon exit) to more management optimization or repositioning plays (cash flow from Day 1, but a much lower IRR after exit) and everything in between.

I've just assumed that the total risk adjusted IRR is the same whether the deal cash flows early (small repositioning) or is a deep value add with a higher IRR. In other words, if the repositioning has zero risk and an IRR of 15% but that the deep value add has an IRR of 25% but fails 40% of the time (and assuming failure means I just get my capital back), the two investments are equivalent.

Thinking about it more, I think I've been thinking about this all wrong. 

While I understand that the deeper value adds naturally have more risk with them, I feel like the risk from a deeper value add is more that the investment might not cash flow for a while and then might only be a 17% IRR in total (instead of the 25% in the example above) because they can't get to the rents they want or otherwise can't live up to the pro-forma. There's also a risk premium that someone has to put on the deal for something that doesn't cash flow for a while - investors need to be paid for that delayed gratification of having their capital tied up for years with no cash flow coming in.  But, in general, these are better ways to grow wealth than more conservative repositions of assets that already cash-flow.

So, assuming the above is right, if you don't need the capital back for a while and don't need the added cash flow in the short term, are the higher IRRs associated with deeper value adds just simply better risk-adjusted deals for building long-term wealth?  I know it's far fetched to say "eh, I don't need the equity back and I don't need the cash flow for years, I just want the best long-term return", but, if that really is the case, then what am I missing here?

I'm looking for a real estate attorney in Brookline MA for some help in navigating the process for getting a zoning variance approved

Curious - how is this going now? Just found this post and, given it's been about a year, curious how it's going @Kyle Kovats.

I'm in a similar position, so curious to learn from your experience.

I'm looking for to take a loan out on an investment property I just inherited in Boston - looking for $1.25M or so on a property value of $2.5M. Looking for a 30-year fixed but would do a different structure if it meant the rate was a lot better.

I live in the Bay Area and have a similar amount of capital to invest. I wouldn't invest anywhere around us.

I can loop you in on some syndication deals, PM me. Passive income, good returns.