All Forum Posts by: Ryan Daigle

@Chris Cadez one of the things I had to let go of early on was the "would I live here" mindset when it comes to curb appeal. I think as long as safety is not a concern, an ugly property is not a huge detriment. I've seen lots of ugly properties rent for market rates. Depending on the class of property, the tenants often don't have the luxury of just living in a pretty property. As long as the basic quality of housing is good, the appeal won't factor in to their decision.

And to echo others, even ugly homes can be improved with some well-placed improvements, if you're willing to invest in it.

@Jon Allen Jr welcome to the area! You chose a great spot for living and investing.

You should speak with Dawn Brenengen at Trailwood Realty for your residential needs.

I’m on the multifamily side but would be happy to chat about that as well when you touch ground here. 

@Jason Barnes you can have as many loans as your net worth and capital will support.

People move up quickly by forcing appreciation on a property, selling it, and rolling the gains into a bigger property. No need to wait until the loan is paid off to do so.

@Patrick Sharr physical occupancy and LtL/concessions can have an inverse correlation. As an operator you might choose to optimize for getting the max market rent (thus minimizing LtL) but that could result in it taking longer for you to fill a unit (thus increasing physical vacancy). So I view those as interconnected concerns.

Bad debt is much more specific to your property and area.

Depending on your area and property class, I'd get nervous to underwrite anything less than 10% economic vacancy (physical + other).

@Todd Dexheimer I agree that is the case, but will people be adjusting their behavior because of one incidence of this unique pandemic? Will they be willing to throw away all the benefits of urban living (which brought them there in the first place) because of this? Right now I'm guessing "no", but it's just a guess.

Being a data-driven guy, I think it's important to identify a few key metrics (or KPIs - key performance indicators) that show how well a property is performing. Mine are:

• Income: Collected rents
• Occupancies: Physical and economic (collected rent as % of expected rents)
• Marketing: Days on market for ready to rent units

Monitoring these KPIs will quickly give you insight into which the areas of the business are performing to expectation, and which are not. But more importantly they provide a historical reference and can help identify trends and correlations.

For each of our properties, we establish a performance tracking dashboard that visualizes these monthly KPIs as trends across the full history of the property. The goal is to not get too fixated on any one month or one data point, but to ensure the long term trend is headed in the right direction. Here's what one of our recent ones looks like:

What KPIs have you settled on for the multifamily investments you're managing?

According to JLL:

I tend to agree, though it's hard to generalize across all of multifamily since there are so many different types and classes. The report goes on to say that occupation density will be a factor for investors (logical given that proximity is such a contributor to COVID contagion). So those urban core assets where elevators and other enclosed and high-density spaces are prevalent might make some uncomfortable and result in less demand.

I'm actually optimistic about COVID _not_ affecting the decades long trend of population migration to urban cores, but maybe I'm being naive. Do you think high-rise multifamily will be negatively affected by COVID long term? Would you move money from urban core to suburban garden style multifamily as a result?

@Sarina Payne I would confirm that your bank will actually lend to you. With commercial loans they are looking for past experience which can be a bit of a chicken and egg situation when you're a first timer. That's why partnerships are so prevalent in commercial.

Let me know if I can help!

@David Silva sorry to hear about your situation. You're definitely not alone.

Forbearance is certainly an option though it comes in many different forms. You should definitely talk to your bank about each option and what if anything will show up on your credit report or negatively affect your ability to get financing in the future. That's something we just don't know much about yet since the program is so new and it varies by bank. Just be aware there's rarely anything free with these programs.

@Connor Mullen I'd second using Michael Blank's SDA spreadsheet. When you purchase it you also get access to a series of videos that explain how to use it which should be informative for somebody at your stage. There are definitely some major differences in how you value MFH vs. SFH.

If you want to see me walk through a first-pass evaluation of a small multifamily using the SDA.

I'd be happy to walk through your deal with you as well, just DM me.