All Forum Posts by: Art Mimnaugh

@Peter Lohmann are you including property management fees in the “professional fee’s” or has that been excluded in this review?

Cheers,
Art

@Robert Hanson so we own a decent number of assets in Columbus all in the Class C areas and the name of the game for us is minimizing vacancy.   The qualification you describe would be great but in this asset class I would say it is almost impossible to find.    For us the qualifications are simple 3x rent and no evictions!   We verify pay stubs and previous landlord and do background checks/criminal checks.   Require one ones security deposit and clear on payments terms, (Due on 1st, late 3rd, post 5th, eviction is filed on the 9th) and we also don’t take any partial payments.   The landlord laws are pretty friendly on Ohio so we can have them evicted/set out in ~45 days and around $400.   So we end up being out a few weeks of rent and repost.   Not saying is great but we haven’t found perfect screening criteria as have seen perfect tenets for 2 years have an event and all of a sudden stop paying and we have to evict as well.   Drop me a line if you have any questions and we can exchange notes.

Cheers,

Art

@Anne Marie Kodama if focusing on Columbus drop me a line and happy to grab a coffee and exchange some notes.  I am Bay Area based with a growing portfolio in Columbus has been a great market for us.

@Layne R. so just did a quick check on a few things in Lawton and I think your rental numbers seem very high.   For population there are A LoT of units listed for rent and specifically of the 1/1 variety staying on market multiple months with rents between $300-$400.   To preface I don’t k ow your market so if you are comfortable with the rental numbers great but be aware should any of your tenets leave there is HUGE competition.    As separate data point there are rent ready duplex listed for $25k which puts market at $12.5k a door possible (area excluding).   That would put your 4 plex in the $50k range.   Anyway hope this helps some and just make sure you confirm and are comfortable with your rental numbers.

Cheers!

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $410,000
Cash invested: $20,000

We bought this with 25% vacancy and an average rent of $500. We done some rehab updating units, implemented utility bill back and new management. With this in place we have raised rents between $700-$750.

What made you interested in investing in this type of deal?

As OOO investor was looking for our first deal to be over 10 units to have impact with property manager. Also building was in a good school district bout rougher area.

How did you find this deal and how did you negotiate it?

Deal came to us through a broker.

How did you finance this deal?

As was parceled as three separate APN’s we acquired with standard residential financing and three loans. After rehab and new leases we refi into a standard commercial product removing all our cash plus more.

How did you add value to the deal?

Rehabbed the out of service units, cleaned out non paying tenets, utility bill back, and general building/parking lot fixes.

What was the outcome?

After rehab we buildings apprised at $660 and we were able to pull cash out while still generating about $2k a month in cash flow.

Lessons learned? Challenges?

Don’t hang on to wrong team for too long. Had to go through a few PM’s to make it work. Class C isn’t passive if you want income no matter how good the PM.

@Nicholas Beale the asset you are looking at in columbus what area and class of property is it.   I ask because have found that some great PM’s become awful and vis-versa when you start moving areas (good class C PM’s are terrible in B class for instance).   Similarly if focusing on university housing there are specialty PM’s. 

Cheers,

Art

@Mohil Prajapati welcome but to be honest there is no way to answer this without context on your goals and strategy. You looking for some cash flow in more stabilized areas or higher potentially cash flow with a lot more work in some of the tougher areas? You could cash flow in just about every area if you are ok with lower CoC returns really depends on goals and strategy. @Brandon Sturgill has a decent neighborhood guide to Columbus that could be a good starting point.

Cheers,

Art

@Titus Capilnean welcome to BP and the growing group of us Bay Area investors that have found Columbus.   Drop me a line as always happy to chat and exchange notes about our experience.   Additionally I host a meetup on just this topic rotating between Bay Area and columbus.    Our next Bay Area meeting is next month.

Cheers,

Art

This is our kickoff event in Columbus and we are looking forward to having similar in San Francisco.   We are a Bay Area investor group that owns a number of small multi-family in Columbus.  Please join us to talk real estate and meet some of the great people on the ground in Columbus making this all happen.

For this event we don't have any real formal agenda but rather just wanted to get a bunch of smart people together in a room to network and discuss the increasingly strong interest from California investors in the market and connecting those with local teams.

@Tyler Durinka nothing in the post to give opinion on.  Grand view as you mention is great but as a cash flow investor numbers are hard to make work.   With that said hard to provide too much insight without numbers.

Cheers,

Art