All Forum Posts by: Charles Carillo

@Andrew Joseph

I would suggest speaking to a US based CPA and/or attorney that works with Canadian investors. We have partners who are foreign investors. DM me and I will send you contacts for; attorneys, lenders and accountants that they have previously used. It is important that you hire professionals that have experience working with foreign investors.

@Ellie Narie

Yes, you can quit claim a property into a LLC. Check with your attorney before doing anything. Usually the main issue here is the Due on Sale Clause with the loan.

I believe the larger issue here is possible fraudulent conveyance. I am not an attorney (so speak to one first) but in Florida; a fraudulent conveyance (also called a fraudulent transfer) is a debtor's transfer of legal title of non-exempt property to a third party with the intent to hinder, delay, or defraud a present or future creditor.

As mentioned twice already; call your attorney today and explain your situation.

Ivan Barratt is a real estate operator who has acquired over 6,000 units to date. His dad gave him the book, "Rich Dad, Poor Dad” which got Ivan thinking and in his early 20s, he started as a landlord, which wasn't ideal for him. He had graduated business school with big dreams of becoming a developer. Ivan then went on to acquire multi-family units, and he started building a team. He was syndicating these deals and it was a lot of trial and error.
At first, Ivan hired property managers to manage his properties. However, he decided that it was more efficient to handle management in house; in addition to it allowing for accurate underwriting when it comes to acquiring new properties.
Ivan focuses on acquiring A class properties with his team and works with individual investors to raise capital for the deals. Ivan believes that daily discipline will help anyone succeed. For him, he's at it all the time and never quits. This is probably why he is so successful.

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@Mike L.

You can pull lists in your area of buyers who are high equity buyers (cash buyers). You can then reach out to them about adding them to your list. You could network locally as well and before accepting an offer; require proof of funds.

@Matthew Conner

I have owned 3-family properties since 2006. It really comes down to figuring out who is really causing problems at the property. Once you find the problem tenant; offer them the option to break their lease and move out.

Some tenants have legitimate complaints but then I have found that some tenants complain just because someone on a floor above them is walking in their apartment early in the morning. That is what you signup for when you live in a 3-family property and you live with other people under the same roof.

@Vinh Nguyen

You are trying to throw away items that they will not collect. I would contact Public Works and ask them for details.

@Kolton Gutierrez

When you purchase a property and you inherit tenants; you are inheriting their leases as well. You are unable to force the tenant to sign an addendum to their lease. I guarantee you they are not going to sign an addendum that says they need to pay for damages caused from smoking (or pets or anything else) that was not mentioned in the current lease and I do not blame them. They have a contract and they want it honored; just like you want to be paid rent as outlined in that lease.

The renewal however might be a different story; speak to your attorney about the wording in the new lease.

@Luke Baumbach

I would have her complete a new application, provide pay stubs, pay the fee, perform a background check and then sign a new lease. If she does not want to do this; you need to speak to your real estate attorney.

Honestly, I would be very wary of what is happening. They are lying to you already. I would probably give a call to my real estate attorney first before doing anything else.

@Branden Yang

Start networking at your local meetups. I would suggest doing a deal with your own money before partnering with an investor. The knowledge you will obtain from actually doing a deal will assist you throughout your real estate investing career. Also, it is much easier to raise money for deals after you have done one.

Today we’re going to be discussing why are large investors acquiring smaller properties. An approach that is becoming more and more popular in today’s market is large investors purchasing smaller properties. Charles’ company has utilized this same strategy several times over the past few years and in today’s episode, Charles discusses why this becoming more relevant along with the pros and the cons.

Talking Points:

➡ Our firm started purchasing smaller assets a few years ago in one main market, Tampa. In recent months though we are seeing other investors take this same approach. So why is this happening when every syndication/investment course/coach out there is preaching to anyone that will listen to only buy 100+ units?

➡ The main reason is price.

        o It is typical that complexes with 100+ units will sell at a premium when compared to smaller complexes. This is something that we are seeing in a number of markets throughout the Sunbelt; including Florida.

        o Yes, in a perfect world we would only purchase 100+ unit deals but in hot markets we have been looking at smaller deals, 50+ units; and not just 50+ unit complexes but putting together a portfolio of nearby properties in order purchase as many units

        o In one Tampa deal we purchased a 32-unit complex with 27 units comprised of triplex and quadplexes around it; making it a 59-unit deal

        o In another Tampa deal we purchased a 22-unit property with a 68-unit property a couple blocks away; making it a 90-unit deal

➡ Points to consider

        o The United States is seriously lacking multifamily and industrial inventory – not just large complexes but multifamily units in all size complexes

        o In larger deals (100+ units), you are normally going to see less rent growth compared to a smaller complex since larger complexes have been targeted by most investment groups while complexes under 100 units are typically passed over (until now) by larger groups – this is mainly due to the fact that larger investors want to place 5+ million dollars in each deal and will pay a premium to do so

➡ Cons

        o Usually, no amenities

        o Slightly harder to manage and lease units – not every property has a leasing office or onsite management

        o If you have tens of millions of dollars to place (for each deal); this is not the strategy for you

        o New investors in a market might being paying more for management until they have purchased multiple smaller complexes and get some scale

        o You have to purchase more deals to place capital

        o Time involved to do a deal is similar to a much larger asset

➡ Pros

        o You are still buying deals and placing capital

        o Great for smaller groups or groups where you already have a management footprint in the market – the more units you buy; the less expensive your management becomes

        o Smaller properties will typically operate on lower expense ratios than larger properties; mainly due to not having amenities

        o Not competing with larger investors

        o Smaller deals are a less perfect market; I believe it is easier to find value in smaller complexes say a 10-30 unit deal or even a 50-unit deal vs. a 200-unit deal being sold by a very sophisticated investment group

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