All Forum Posts by: Chris Winterhalter

@Joshua Andrews

As mentioned you need to reach out to as many local and regional banks as possible in your area. Talk with the commercial lending department...generally a few "VP's" that handle the business banking side of things and CRE lending per bank/branch. Many times these people can approve 250k on the spot by themselves, then 500k by asking their boss, and then board approval above that. Underwriting will generally be in house or will be contracted with a local third party underwriter (more common for credit unions). Ask them who has the ability to approve the loan at the bank. Get referrals from small multi-family brokers, insurance brokers (writing these types of policies), other investors, property managers etc. Be very clear about your financial situation upfront so you can weed through the highly conservative banks. Ask them what their appetite is for your size multi-families and what type of deals they have recently funded in your area. Of those examples ask if the borrower had an existing relationship or was a new client. The more banks you talk to the more term sheets you will get. The goal is to get 2-3 term sheets and negotiate down for the best rate and terms.

I read the title to this thread and thought you were referring to a building inspector...I initially thought you were out for blood...which God knows City inspectors are not the most loved human beings on earth. I wonder if there is a hit list out there for City Building Inspectors?

@Matt Laird

With the right person and the right structure (operating agreement) it could be perfectly fine to do a 50/50 split where you bring all the capital to the table in exchange for guidance and a solid preferred return. You will be playing in the full recourse loan market so both of you would need to personally guarantee the loan. A lot will hinge on the investor putting the deal together. Make sure you properly vet anyone thoroughly. Background check, references, credit check, etc etc. If they balk then walk...maybe that should be my slogan??? Honestly I would have no problem with providing that information to a potential investor. You can even have the potential financing bank show you their credit report so they can avoid an inquiry.

@Account Closed

That was a joke...there are a lot of frustrations with this game we call real estate.... and a lot of them come from bankers!

@Ann Bellamy

Another Saab lover! Several years back I purchased a 08 Saab 9-5 Aero and fell in love with it. They lose value so quickly (even before shutting the doors) so you can pick up a really nice used one for a great deal. Like you mentioned the maintenance cost can add up and it can be difficult to get parts. I am in love with the last year (2011) 9-5's and will probably trade up this year. The issue is the parts though. One of my good friends is an excellent mechanic and has a lift in his garage where he does side work. He handles most of my work on it. However he is advising me against trading up to the 2011. I drive so much it might just be worth it to upgrade to a hybrid or a Volt. Or maybe an Audi diesel...we will see!

@Joe Fairless

How big of project? New development correct? I might know a few experienced developers across the river.

@Joel Owens

This should be a mandatory set of photos shown to every out of state investor, Californians, new investors, etc etc when getting giddy about a low price per door multi-family. The 2% rule means absolutely nothing if your turns look like this every 6-12 months. And depending on what Jarrett does he might be able to turn the unit for around $2,500. However $2,500 year in rent ready costs makes the 2% rule go from hero to ZERO.

@Jarrett Harris

Thanks for sharing...it's wild how some people live. Hopefully these were inherited tenants and you are filling the rest of the building with a little better grade of tenant???

@Account Closed

Frustrations in real estate? What are you talking about? It's all smiles and laughter over here....

@Matt Laird

You are looking for the perfect mix. I would bet that you will have to give somewhere to get into a deal with everything that you want. Most experienced syndicators that are bringing cash to the table don't have time to teach someone the ropes of doing the deal. You could give up more equity or request a lower return however you would probably need to be the single investor on the deal. The syndicator is going to want to structure the deal consistently across the board for all investors. I'm not saying that they couldn't offer you a lower amount of equity and return for the same $1 that other investors put in however that can get complicated.

Your best bet is to work with a smaller experienced multi-family investor that is looking to grow. Someone that has experience with 10-60 unit buildings and has built a strong track record. With smaller sized buildings you could potentially be the sole investor on the deal. You could still have the syndicator put in some funds however request a lower equity stake in exchange for learning the ropes. Also I would spell out exactly what the mentorship looks like on paper. You both might have very different expectations on what that looks like. And as always have an experienced securities lawyer put together the transaction.

We are seeking off market multi-family complexes with 50+ units in Cincinnati and St. Louis. We are flexible on sub-markets however stay away from war zones and declining areas. We can move quickly if needed. Rehabs are not a problem.

Call me directly at 513.505.1002 or shoot me an email with the property information at [email protected].