All Forum Posts by: Taylor L.

Traction, The E Myth, and The One Thing have been my top choices in that area. I've also been told by several prominent investors that Who Not How is another great one, but I haven't read that one yet.

 Florida, Georgia, certain parts of AZ & TX. B class assets in B+ class areas.

IMO the answer is "It depends" but most of the time it shouldn't impact your returns. This is where reading the legal docs you receive comes in. The sponsor may have a setup where they get additional compensation for bringing in investor capital, but that should come out of the GP's share of the deal and shouldn't impact LP returns.

Getting compensated for raising capital does require additional work on their end to remain in compliance for doing so. I raise capital for real estate syndications & have licenses to do it; we also do a huge amount of vetting of operators for the protection of our investors, beyond what most fund managers do. Getting licensed showed me how much the syndication space is like the Wild West.

When it comes to investing as an LP generally: 

At a high level, look at the sponsorship team first before you look at the deal. Has the sponsor gone full cycle on that type of a deal before? Have they invested in that area? Do they have an existing relationship with the property manager or do they own the PM company? 

Once you've done that, look at the deal & determine if its assumptions, the market, the business plan, and returns are in line with your goals.

We've shifted from C class to B class assets. There are a number of reasons for that, but at a high level B class assets tend to need much less in terms of deferred maintenance which oftentimes does not add to NOI. C class assets used to be priced cheaply enough such that the deferred maintenance wasn't such a big deal, but prices have risen to the point where C Class just doesn't make sense. 

Think about it this way: if we're buying a property and planning on $750k in updates and repairs, we want to be able to allocate all of that $750k to improvements that bring in additional income.  We want to allocate the whole renovation budget to interior & exterior amenities & improvements, rather than having to replace roofs, repair old plumbing, bring electrical up to code, etc. 

I have heard absolutely amazing reviews of Gobundance. Not exactly formal mentorship like you're referring to, but a high ticket networking-type group which has a ton of successful real estate investors & other business people. Tons of opportunity to connect with others who can push you further.

See if you can find partners whose strengths fill in for your weaknesses. We all have weaknesses, best to be aware of them and account for them. 

Pick one market and stick to it. Get to know it like the back of your hand. 

Totally agree with getting out of the fear mindset. Fear is the mind killer.

The age, amenities, and HOA terms are going to be huge factors in this. Condo special assessments can be significant if big expenses come up (roof replacement, for example).

How old are the major systems? 

We've done deals from Houston, to DFW, to the panhandle. It's a huge state with varied markets, if you can home in on specific markets you like that'll help in your search! I have avoided southwest Texas, too dependent on O&G.

Networking and broker relationships. Today all of our deals come through a network of established relationships which took years to build.

I talked with them earlier this year about an acquisition, but when push came to shove I got a better rate and much lower fees with a different lender. I'd just say shopping around is a good idea.