All Forum Posts by: John Teachout

The issue here isn't the age of the property, it's the condition and price stacked up against the current and future income potential of the property. This would be a horrible deal. Find something better to put your money into.

1 Vote

Salt Lake City, Utah

Real estate law is local so you should have someone that is familiar with the area you're investing in. If you're investing in another state, find someone that's familiar with that state's laws which in most cases will be someone that has their practice there.

2 Votes

New York City, New York

Our first step upon contact is to send the interested potential tenant a profile listing all our criteria. Most self screen themselves out of the running.

0 Votes

So unless the property management is going to be done by the deal sponsors, they're not delineating what amount is going to which... The more details that come out about the structure of this syndication the hokier it sounds to me. You seem to be committed to moving forward with it so all I can suggest is to bring this thread back to life in a few years and let everyone know what happened.

0 Votes

Your best bet would be to try to get hold of an actual person at the IRS and explain to them what happened to see if there's any hope of reversing this. Was a distribution made that you didn't authorize? It's not clear from your post.

0 Votes

Quote from @Brandon Craig:

Quote from @Will Barnard:

Quote from @Brandon Craig:

Quote from @Chris Seveney:

@Brandon Craig

If they have a 40% annual return in their PPM and offering info run for the hills. If that was the case and they delivered that return they could raise $1 trillion as who wouldn’t want a 40% return….

Also find out how much of their own $ they have invested in the deal. What is the flow of funds - who gets paid first and what are the management fees

What are the lock up period

We put together a 20 question questionnaire to ask your syndicator. Let me know if you want a question

They have 0 in the deal it’s all investors 50/50 GM/LP

investors first.
2% acquisition fee
10% asset management fee
1% capital transaction fee
10% preferred return to LPs

Year 2 refi+NOI shows 121% COC and year 7 155% on sale. In between years are 5-8%

I was very skeptical when reading your initial post and a few follow ups. After reading this last post, I now know my skepticism was highly warranted. 10% management fee? I would love to get that high of a fee. 50%/50% split? I would love to get that much as a sponsor! NO skin in the game for the sponsor? Not a good answer. The truth is, those numbers and terms are just not going to work. Proceed with extreme caution on this one or better yet, run. While it may work out, it sounds like a real long shot especially with the splits and fees as they are!

And isn’t 10% normal for someone to manage a property?

10 percent to manage a property is typical but not to manage a fund or syndication. Most syndications have a management company in place but that is not related to their asset management fees...

0 Votes

We've invested in multiple syndications and while I'm no expert on them, I will say that this sounds like one of those "too good to be true" situations. It appears to be pretty unrealistic.

3 Votes

Does the property have gas or propane? Gas logs are nice. We usually put those in any wood burning fireplaces to keep tenants from building wood fires. We heat our own house with wood but we do it every day in the winter so have lots of practice...

0 Votes

With this type of "partnership" situation, everyone needs to bring something to the table. What would you be bringing if they're bringing the money?

1 Vote

My experience with deed restrictions is that they would only be able to be enforced by tort. The municipality typically can't/won't enforce them and unless the "neighbors" actually took you to court to get you to cease their perception of prohibited activity, nothing will happen. That said, if there's an attorney or irritated person in the neighbor group they very well may start a court action. Doesn't mean they'll win though.

0 Votes

Upstate New York, New York

All Forum Posts by: John Teachout

John Teachout has started 21 posts and replied 3450 times.

Post: How would you justify a $1M duplex that is 100+ years old

Post: Is an interstate legal team OK? Or is local essential?

Post: Stating your tenant criteria up front?

Post: First Syndication Deal

Post: Unintended IRA distribution

Post: First Syndication Deal

Post: First Syndication Deal

Post: Wood Fireplace Replacement Ideas

Post: What is a typical deal structure with outside investors?

Post: 100 Yr-Old Covenant/Deed Restricting Short-Term Rental?