All Forum Posts by: Tj Hines

@Tab Teehee typically in a property that size you will see about 8-10%, but if they're treating it at as a sister property then management has the economies of scale working for them, so I don't know you may be able to talk them down lower if this is the case. Not sure what your NOI is on this deal.

@Victor Fermin there are a ton of choices as far as underwriting software. We use Michael Blanks SDA. We used quite a few out there and this is one sort of technical but once you understand the power of it - it eliminates a lot of the guess or assumption work for you

@Dassi Lazar Congrats on your new journey and the portfolio you've acquired. In my opinion multi has many more significant advantages with tax benefits that you can only get on the commercial side opposed to SFR market. Also being able to force the appreciation on the asset is key. Not to mention you have total control of the value.

If you're looking at online deals by brokers the majority of the deals you find there will be hard to pencil. Try going off market. Buy a data list and start marketing to those owners. I wouldn't use hard money. Way too expensive. Best thing to do is go the syndication route. Take on long term debt with low favorable rates and raise the equity from close acquaintances that's in your network.

Everyone shares in the cash flow together and you go further much faster. The strength is numbers.

@Michael Ealy the one we were supposed to be closing on in a few weeks. Had to step away from it due to negligence of seller falsifying bank statements.

If everything came back to be true we were looking at a modest 10% CoC in the first year with 18%IRR conservatively C property in A- area on the golf course. Deal was sort of complex we found this gem under a rock. Upside was tremendous, but after reviewing the bank statements come to find out the deal was not cash flowing day one.

@DeVora McCoy

Where can I find a buyer for the property? (Network at local REIAs to see if investors have interest in the deal)

Will I need to have any money at all for a wholesale deal? (No you don't need your own money. You can assign the deal. You will need the money if you have to double close. If you are double closing and don't have the funding, then there are transactional funders out there)

Do I need a commercial realtor for this deal? (You don't need a realtor at all)

@Sebastian Roy if you're going to live in one of the units, you may as well manage it yourself. Just let the tenants know you work for the owner and you're not the owner. This will give you some really good hands on experience that is invaluable, especially if you're looking to scale up.

@David Smith I suggest you never buy a commercial property under your personal name. Way to much liability to assume my friend. Always purchase with an LLC

@Shafi Noss focus on using local community savings and loans banks if you're looking for funding on smaller deals under $1M dollar loan balance. If you're just talking in general as who should you bank with for personal reasons then there are many of those choices out there. It boils down to personal preference.

@Ronald Starusnak how long do you plan to hold this project? Sounds like this deal may not be in the greatest area. Not only should you be thinking of how to reduce crime but most importantly even if you reduce the crime in the complex, what would be your exit strategy? Is the area gentrifying? Is it up and coming? Is it in the path of progress? Are people migrating to that area or leaving that area? I would get answers to all these questions before moving forward with this deal, unless you have a ton of experience dealing with these types of projects. Take care. Good luck with it. 

Thanks @Yannik Cudjoe-Virgil for sharing this. You're spot on! Management is the most important aspect of asset management. That's usually the main reason why these deals go south. Congrats on your career and sorry to hear about the devastating knee injury. Things are waaaaayyyyy much better on this side for the long term. Congrats for stepping out of the box. Most NFL athletes are lost after football. It's sad! Thanks for highlighting this. I back you 100% on this