All Forum Posts by: Robert Lipscomb

My property manager just started a remediation and decontamination business. On the cusp of the pandemic coming to the states, she attended some training in Vegas and started this business when she got back. Seems like it could be profitable. TBD

In my 24-unit complex I have about 75% section 8 tenants. Coincidentally, I have about 75% of rents in at this point. 

In my SFR, the tenant is a manager at a Carter's retail store. He was furloughed so I gave him some time to apply for unemployment. He will be paying full amount today.

@Gregory Schwartz

Fellow O-3 USMC reservist here (I'm a grunt though, try to stay out of flying things). 

I commend the bold move and hope to make a similar move soon. I'm not long in the rental property game, but it sounds to me like you have a solid plan with built-in flexibility. Being in the reserves gives you some flexibility that is unique. You can often go on orders for extended periods of time, especially as a pilot.

I purchased a 24-unit apartment complex that I closed on Dec 27, 2019. The majority of the tenants use HUD assistance and many do not work. This virus situation may not impact my operations as much as others, but I assume things will still slow down and it will get more difficult to fill vacancies.

Either way, I firmly believe in making simple plans and executing them boldly. Keep up the good fight. 

Semper Fidelis

@Brian Ploszay 

"Use softer words"

This is an investment forum, my friend. Everyone knows the phrase "Be Greedy" is a reference to seizing newly presented opportunities in investing your money. Let's not make this a forum for melting snowflakes. 

I'm needing the exact same info. I'm looking at some apartments in MO that are master-metered and on a boiler system. Wondering how to legally pass expenses on to the tenants for both gas and electricity.

Great feedback! 

The preferred return structure makes a lot more sense and I'm sure everyone (partners, banks) will understand it better than the situation I described. 

I'm trying to buy a 20-unit apartment complex in Southwest Missouri. The specifics on the value of the complex is the subject of another post. In this one, I want to get feedback on whether or not this partnership scenario is feasible. 

Facts:

- The owner wants to sell but would be willing to only sell a portion as long as he's not involved in daily management.

- The owner is a family friend. 

- I could possibly come up with the funds to purchase it conventionally, but it's a long shot. 

Proposal:

I partner with the owner and finance the deal so that he maintains 20% of the complex with his remaining equity. I add $50k in operating capital and take on all of the debt. So, he gets 20% of NOI and I service the debt with the remaining. Over a couple of years, I force appreciation, mostly through RUBS and rent increases which are long overdue, and then refinance and buy the original owner out.

So Original owner is limited partner that contributes 20% equity. I am General Partner that contributes $50k cash and all debt. 

Is this feasible? What am I overlooking? Sorry for sounding like a rookie (I am).

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $950,000
Cash invested: $190,000

24 unit apartment complex. Mostly HUD tenants.

What made you interested in investing in this type of deal?

I'm just getting started in multi-family so I wanted to stay close to home. These apartments are located just down the street from the main drag in Joplin (Wal-Mart, Target, restaurants, etc.) and they are close to some higher end apartments. There is also a large lot on the back side of the apartments that I plan to develop with more multi-family buildings.

How did you find this deal and how did you negotiate it?

This property had been listed for a while so I just went through the seller's agent. The owner was asking $1.2 million. I took the cash flow, assumed a 50% expense rate and made an offer.

How did you finance this deal?

Conventional loan

How did you add value to the deal?

Just bought it.

What was the outcome?

Just bought it.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Andrew Bright out of Joplin, MO.