All Forum Posts by: Joseph M.

@Christopher Petersen I noticed the Forbes article is from 2014 , it doesn’t mention when this was supposed to happen but we of course have seen demand and prices go way up nationwide since then . I am skeptical about the articles written in the mainstream press on real estate since they have been wrong so many times . Also as mentioned all real estate markets are local so there isn’t one real estate market . It is important to look at demographic trends , census data , what type of industrIes are there ,what are the plans of the city etc. At least with real estate things don’t change overnight so if you keep on top of the market and notice things are changing you can get out and reinvest in a more attractive growing market . Good luck

#NEVERMORRIS

@Matt Jones , That's great you are getting 94% back. Oh ok that makes sense, I didn't realize the tenants were still there after purchase for a while. Just curious what was the previous rent with the original tenants. 

Based on the expected cash flow numbers (if I did the numbers right) , it looks like you'll be earning about an 88% roi on your invested capital ( not including any appreciation of course. Nice! 

Just found this from the government website. 

(ii) Substantial improvement

For purposes of subparagraph (A)(ii), property shall be treated as substantially improved by the qualified opportunity fund only if, during any 30-month period beginning after the date of acquisition of such property, additions to basis with respect to such property in the hands of the qualified opportunity fund exceed an amount equal to the adjusted basis of such property at the beginning of such 30-month period in the hands of the qualified opportunity fund.

Link: http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section1400Z-2&num=0&edition=prelim

Originally posted by @Sam Grooms:

@Account Closed, where did you find information on this 30-month requirement? I've been reading a lot about this, and haven't seen that anywhere. 

 I saw it mentioned in this document from Citibank.  The PDF gives a good overview and outline of the benefits and definitions of an opportunity zone .

"For real estate, QOZBP must generally be new construction or “substantially improved”, effectively meaning that rehab costs over 30 months must exceed acquisition cost"

"https://www.citibank.com/icg/sa/citicommunitycapit...

I also heard it mentioned by on a "Real Crowd" podcast featuring Derek Uldricks of Virtua Partners  http://virtuapartners.com/  they are global private equity firm focused on commercial real estate and look to be very experienced.  They have multiple offices in the U.S and Hong Kong as well. 

Link to the podcast is below , the podcast episode was focused on opportunity zone investing and found it interesting .

https://www.realcrowd.com/blog/2018/08/podcast-lea...

@Ruben Guerrero Thanks . It seems there are still quite a few questions in the air due to it being a newly announced program /incentive . Makes sense to get the process started soon though to get ahead of the game . Best of luck with your fund

Been reading a bit about these opportunity zones recently , but have some questions. Is one able to sell a personal residence and then use the proceeds to invest in an opportunity fund or does the property have to be a rental ? If it needs to have been a rental/investment property is there a certain length of time requirement? Example “property must of been a rental for 1 year “etc ? Also since there is a requirement for the property to be substantially improved and rehab costs needs to exceed acquisition costs within 30 months it seems these would mostly be new development projects or major redevelopments ? I imagine there wouldn’t be income paid out at least in the beginning versus someone buying say an apartment building directly ? Holding for 10 years is a big incentive due to the elimination of capital gains , but if one did pull out of the fund earlier would there be some kind of penalty ? How easy would it be ? Is it more like a syndication where the investment can be tied up for several years or more like a mutual fund where one can sell their shares pretty easily ? Also what are some typical expected returns being offered ?

@Matt J. Looks great congrats and definitely a good price on the work. How did the refinance go where you able to get all of your money out ? i‘m guessing the lender required 6 months seasoning since you mentioned it was purchased in January?

Originally posted by @Jeff S.:

Meet Kevin from Youtube.

 I have seen him on Youtube , he's pretty over the top and dramatic but I guess that helps to get the views. I know he did mention his "real estate is crashing" belief is based on his local market where he is an agent , which seems to be Ventura County in Southern California. 

In L.A at least things are still going under contract quick if priced right and multiple offers...and prices are at all time highs..so don't see signs of a crash here , now at least.

Sales are down in Southern California, but that is because there is little inventory. 

CNBC recently put out this article. Of course they make the headline dramatic but it makes sense sales would be down if inventory is low. 

Southern California home sales crash, a warning sign to the nation"

"https://www.cnbc.com/2018/07/24/southern-california-home-sales-crash-a-warning-sign-to-the-nation.html

Just saw this recent article 

—

Real estate firms dig deep to fund fight against rent control measure

https://therealdeal.com/la/2018/08/08/real-estate-firms-dig-deep-to-fund-fight-against-rent-control-measureh/amp/?__twitter_impression=true