All Forum Posts by: Brock Mogensen

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@Daniel Soyars The honest answer is it's really tough to work your way in front of people they have done business with for a while.  The best way to be first on the brokers list is to show you can close or leverage previous deals you have done to show your experience.  Targeting newer brokers who haven't built up their buyers list yet is a good play too.  LoopNet is the best source for commercial deals, surprising there is none in your market.

I live and invest in the Milwaukee area.  Happy to provide some insight!

7% cap is a realistic number to me but depending on the market, cap rates can be as low as 4%. I suggest spelling out your buy criteria to the broker.  If there is a value add component to the property then maybe a low cap makes sense.  There are good value add deals out there you can buy at a low cap because of the great upside.  Just need to look at lots of deals..

Go on LoopNet and filter to the target market.  Go through the list of all deals that fit the asset class you are targeting.  The brokers contact info will be on the listing.  Make a list of all brokers.  Go down the list calling them.  The goal of the call should be to set up a coffee meeting with them.  Meet with them, follow up with them monthly, don't let them forget about you.  The mistake most people make with brokers is they think one email or call telling them what kind of deals they are looking for is all you need to do.  Top brokers have a list of hundreds prospect buyers.  When they find a good deal to sell, they call the first five people on their list.  The goal is to be in as many brokers "top five" as possible.  That is when you will start seeing good deals. 

Syndication is a great way to scale!  I've done quite a few of them and have enjoyed it.  Learning the processes before hand will help a ton to ensure you are covering all the bases.  Taking on money from other investors adds an extra layer of duty.  Ensuring the deal is truly a good deal is key. 

I'm a big fan of GC but totally agree that he is not transparent on sharing the details of the deal.  All of the questions you listed are great questions that should be asked prior to making an investment.  Building a relationship with a "smaller" syndicator shop may be the best move.  They will be able to answer those questions in depth on each deal and provide you with direct access to the operators. 

Conservative underwriting is a must.  Using the correct vacancy factor, expense ratio, loan assumptions, rent/expense growth assumptions will change the numbers real quick.  Understanding the numbers will increase your confidence on pulling the trigger.  Happy to help out!

@Jason Malabute I personally have not had to bring on a KP, as our GP team had the necessary qualifications already. But I'd say in the initial stages you can just discuss general terms.  If you decide to partner with the person then you definitely want an attorney to draft something up.  The manager operating agreement you create for the deal will likely cover everything you need but to have something in writing before you lock a deal up isn't a bad idea. 

As others have mentioned you'll likely be looking to structure the deal as a syndication.  The structure of syndications (fees, splits, prefs, etc.) can vary quite a bit. Developing a good understanding of how the process works before hand will be helpful.  A good attorney with experience in syndications will guide you through the legal process.