All Forum Posts by: Mark Allen

Kevin Vandenboss We've valued and sold hundreds of similar portfolios. Not much of a difference from apartment complexes other than management fee, payroll, debt terms, and utilities. Of course this varies state-by-state. Also, with Section 8 tenants we typically see higher R&M. Hope this helps! Best of luck!

The top just like every other city across the nation due to US economic expansion period. Rising interest rates will correct cap rates just like every other market as revenue growth slows. If you're talking about 20+ year holds market cycles don't matter as much.

This is a 7.5% gross yield at current rents... that's like a 4% net yield most likely. You can't even borrow for less than 4%. Sounds like a horrible deal to me for a beginner and syndicator. Might make sense if you're HNW who needs to place money for the long term with 60-65% leverage... and banking of future appreciation with Denver growth.

What are your rents? If you were to refinance you'd have to be $3000+ to not have negative yield (after cost of capital). With the little info, I'd say sell and shift capital to a more affordable market.

Mike Dymski is spot on. We've put Fannie and Freddie on single family/multifamily portfolios that are contiguous (next to each other on same street). Local bank is most likely your best option for a portfolio loan in this case. 5Arch and corevest offer a non recourse option at higher interest rate (6-7% typically).

Contact Scott Horne (if you can get a hold of him). He's a local attorney who's the owner finance champ. Tell him I sent you.

At that rent level, those are homes you'd want to sell with owner financing. Be prepared to have plenty cash reserves, high turnover and high delinquency. It would help for you to take a look at his P&Ls to understood how the investor has operated the portfolio. Best of luck!

@austin freuchting has experience. I broker SFR portfolios and many are high net worth or funds, but several have syndicated. We typically see 10% - 20% COC returns depending on the quality and market. Local banks can provide the best terms. Typically 25 yr am and around 5% interest rate. I've seen as low as 3.78% in Chicago area. Best of luck and I think purchasing/syndicating an SFR portfolio is an excellent approach given the competition in multifamily space.

If you're scraping up $150,000 it doesn't sound like you have the net worth or liquidity to buy a small apartment. Consider bringing in partners with the balance sheet to get a commercial loan. I just bought a two property apartment portfolio last year (231 units), but I've debated this because multifamily is a more sophisticated and crowded space. I purchased this deal because the 86 year old seller had let the properties go and she wasn't as savvy about the market, in general. Consider this: market or look for sellers with small single family portfolios. It's a much less competitive space and I think there are many mom and pops out there who are looking to retire, capture equity and take advantage of the sellers market. You're providing value in purchasing as a portfolio because it's a job to sell each home individually AND they save on closing and friction costs (I wrote a BP article about this somewhere).

Tony Castronovo Many times we receive P&Ls from sellers which helps us fine tune our analysis, but if not we're making assumptions. The financial pages are Unit Mix, Financial Analysis (w/ Pro Forma), and IRR deferred page that shows returns with all assumptions. Send me a note and I can send you a sample OM.