All Forum Posts by: Tom Scott

Michael Ibarra You said two things that don't go so well together in the eyes of the SEC: the fact that investors would not have control in the day to day operations but this would not be a security. For more information regarding the qualifiers for being a security, please google the Howey Test. Generally based on that court ruling, if the investors have an expectation of profit and do not have control, it is a security and subscribing investors for an allocation would require registration of the program with the SEC. There are various exemptions available from the SEC from full registration but they usually need to know about it. If you wish to continue down this route with using passive investors, you should definitely connect with a group who does this type of transaction regularly for guidance.

@Tabi Traughber

How would you sell only a block of units?  Is the property in question a condo conversion?

Irrespective of the above answer, a major question you need to answer is what do your comps look like and what would the goal be of adding the amenities?  I'm guessing you may want to make the property be more comparable to properties that have better improvements for example, your property is a solid C, workforce housing project.  You believe the rents at B properties that generally include a clubhouse, fitness center etc. can be achieved by adding these features at your property.  If this is the case, will the cost to add the 15 additional units plus the amenities be recovered in value?  A quick back of the napkin way to check this is estimate the sum of the yearly rent premiums you can achieve by adding the amenities and apply a reasonable cap rate to get your value generated.  If the value generated is greater than or close to the construction cost, it's probably worth it to take a deeper dive into the analysis.      

This stuff is great!! It's extremely durable and low maintenance compared to carpet and it's cheaper than hardwood flooring. A lot of the newer high end product being delivered at least in our market today is using it in lieu of hardwood flooring

Hi everyone.  I decided to actually make an account here after listening to about 30 episodes of the BP podcast, which by the way, is EXCELLENT and full of information. 

About me:  I live in the Washington D.C. area and will be buying my first house in the next 12-18 months.  I want to start my RE portfolio with this purchase however so it's not going to be a dream home and will be owner occupied for 1+ years (at least that's the plan).  I currently work in commercial real estate as an analyst for a company that does direct private placement equity raises for middle market commercial real estate properties.  Also, I've worked at a GSE and another large consulting firm doing structured finance transaction work so I've got a good lay of the land from the capital markets and commercial RE side but know little to nothing about the residential RE side.  It's going to be a fun ride and I hope I can give back at least as much as I take