All Forum Posts by: Robert Rixer

Capital raising and modeling are necessary but they're not competitive advantages. You need to drill down to the core of the business and ask yourself how are you actually adding value? There's 2 main ways to do this:

1) Figure out how to acquire deals below market price.

2) Figure out how to maximize NOI.

If you can do these 2 things better than most, you'll succeed.

"Crushing It: in multifamily and commercial Real Estate" is a great book for starting out in multifamily. A lot of great content on YouTube as others have mentioned.

At all costs, avoid "gurus" or paid seminars. Everything you need to learn the theory is out there for free. The rest you'll learn actually doing deals.

The best way to get interest is to find amazing deals. If you've identified market rate deals, you can do all the analytics in the world but no one will be interested.

You always have to ask, what is your competitive advantage over every one else doing this? For newer operators, the easiest way is to work very hard to uncover home run deals - which can overcome the lack of experience aspect.

It comes down to how easily you can get the ground floor retail leased, if it's not already. With mixed-use the cap rate to apply usually comes down to where the majority of the income comes from, the retail or the residential. With only 2 units it may be more 50/50. The retail should trade at a higher cap rate than multifamily so you want to make sure you aren't paying multi cap rates.

A lot of good answers already. I'll add that if the CapEx improves what you can get in rent, then this needs to be factored in. Unfortunately foundation, roof and new AC won't improve rents as they are expected basic needs. Interior CapEx like a new kitchen, flooring, etc. will garner higher rent.

Assuming the foundation engineer is legitimate and 30k will solve all problems, it comes down to a) are you willing to go through the hassle of doing the work? and b) are you getting paid enough to undertake that risk?

If the same deal without foundation issues is $1M and you're buying it for $970k then that's a poor deal as you're not getting a discount for taking on the risk/work. If the deal is $900k then a lot of people, myself included, would take it on.

The most effective way of raising capital is organically through a network you've nurtured over years and decades. The fastest way is likely going to be to through targetted ads (506c) and direct outreach on platforms like LinkedIn.

Truth is you may have to show some flexibility depending on the area. We all want the A+ tenant but if you're in a C neighborhood, you need to manage expectations. 

More importantly however is where you set the list price at. If you're comptetitive enough versus the market, you're going to get several applications for which you can choose which is the strongest.

You're likely overthinking this. I wouldn't even worry about entity formation or roles or anything until you have a solid deal lined up. So many startups worry too much about their company name, domain, website design, entity structure, etc. and not nearly enough time thinking about how to gain a competitive edge being an operator. 

Assuming you're looking to finance construction (otherwise you would use the cash to take down the land), owner financing wouldn't work. The owner wouldn't want their loan to be junior to the construction loan and vice versa. 

More common with these types of deals is the owner would "contribute" the land as equity in the deal and you would share profits. You trying to have 100% of the deal while financing land and construction is possible but not realistic or advisable.