How I Bought a Multi-Million Dollar Apartment Complex at the Age of 26


A little over four years ago, my brother and I walked into a ugly house built in the 1800s that had an obsolete floor plan and over a century of deferred maintenance. That junky old house was the first piece of true investment real estate we ever bought. That property kicked off the journey that four and a half years later led us to our most recent purchase of a multimillion-dollar apartment complex.

In this article, I walk through exactly what it took and the steps along the way.

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The Road to This Point Was Far From Easy

By leveraging our skills in particular trades, we were able to rehab, rent, and refinance a bunch of these 1-5 unit buildings over a 3 year period. Pair that with 17 fix and flip properties, and we were fortunate to have the ability to pursue our larger goal of buying apartment complexes while also maintaining our existing portfolio. To get to this point was hard! There are far easier ways to go about growing a successful real estate investment business. At the time, unfortunately for us, we simply were not aware of those other ways, so we just did it whatever way we could figure out.

What we lacked in sophistication, we made up for in work ethic. We were not and never will be the smartest at this stuff. Actually, in the beginning, we didn’t know much at all. The reason I bring this up is I don’t want to make it seem like this is easy, but at the same time, I want people to realize anyone can do it — if you’re willing to sacrifice and work hard to get there.

As we continued to put out heart and soul into the business, it grew to the point where we needed help. At this time, we brought on a over-qualified property manager/bookkeeper with the agreement we would bring him on as a partner later to run the asset management after a proven year of success. I’ll tell you more about him later in the article.


Why We Did Not Use Private Investors’ Money

Before I dive in, I feel it is important to explain how we paid for this apartment complex and why we did so the way we did. Real estate investment education is flooded with no money down and how to use other people’s money to boost returns and enter the game. Because of this, some may wonder why we went such a standard route by using conventional financing to purchase this apartment building. Although we used bank leverage, we still had to come up with almost a half a million dollars to complete the purchase. Being that this was the majority of my brother’s and my own saved money from the previous 4 years of hard work, many asked why we didn’t just bring on outside investors. Actually, by this point in our career, we had quite a few people notice our growth and offer to participate by being investors.

Related: How to Start Investing In Real Estate at a Young Age (or a “Young at Heart” Age)

The reason we did it with our own money is because we have always believed before borrowing private money, one should prove the concept and your ability with your own money first. Not to say using private money is wrong; we actually run our whole business model around it now, but for us, it was important to first prove it with our own cash. At the time, we had proven to ourselves in the smaller unit buildings, but never in the large commercial niche. We did not doubt our abilities but were adamant about sticking to this for our own personal standards. Because of this, we rejected offers from outside investors and went in on the deal using only our cash to fund the needed cash outlay.

Determining What Type of Property We Were Looking For

So it was time to buy an apartment! We were pumped because from the beginning of our career, we realized to achieve our long-term goals, ultimately we needed to get into larger apartment complexes. That’s all great — but what did we want to buy? Answering that question was harder and more important than I anticipated.

Fortunately, we had the right partners to answer this question! With my brother’s degree in Economics with a focus in real estate, our third partner’s Masters in Accounting and his CPA, and my degree in Marketing, paired with our strong experience in real estate and construction, we came the conclusion that the following points were the general guidelines of what we were looking for in a multifamily asset.

Financial Metrics

  • Price range: $500k-3 million
  • Asset class: C-B
  • Cap rate: 6% or greater
  • Median household income: >$35,000; preferably $50,000 range

Target Market

  • Cincinnati metropolitan area


Property Type

  • Distressed properties welcomed
  • Value add strongly welcomed
  • Built 1980s or later
  • PVC drain lines
  • Separate gas/electric
  • Pitched roof preferred
  • Brick exterior preferred

Obviously, there were much more detailed analyses when it came to sub markets, but we found this short general list to be so important when it came time to begin building relationships with brokers. The multifamily industry is not easy to break into, especially in a hot market like we are in. A clear one-page document like this at least allowed us to clearly show brokers what we were looking for and separated us from just another phone call tire kicker.

Finding the Deal

We knew the multifamily industry was hot and competition was high. What we found is in the price range (up to $3 million), it seemed buyers were willing to pay outrageous prices. We heard from many brokers that buyers under $3 million were high income earners, buying mainly for tax benefits. This allowed them to be comfortable paying far more than we were willing to. Brokers knew this, sellers knew this, and we now knew it. It was disheartening for sure, but when times get tough, I go back to my roots. No mater what the obstacle, we will always have work ethic, so work harder is what we did.

I built a list of all the brokers who had any multifamily listed in our target areas. I made lists from the public record websites of all the owners who had bought or sold property zoned multifamily in the past 15 years in our target areas. And I called them all.

I called a minimum 5 brokers and 3 owners a day, EVERY day. After about 3 months, I had circled back on my list a couple times and called a big time broker in the area to remind him of the purchasing criteria doc we had sent him and to let me know if he had anything.

That’s when he said, “Yeah, actually I have one that meets what you want perfectly that’s been under contract quite a while, but I just got word it’s about to officially fall out of contract here in the next few days.” I asked him to email me with any information he had on the property. And I would call him back by the end of the day to schedule a walk through if we were interested. The property hit most, if not all, of what we were looking for.


Purchasing the Property

After reviewing financials and walking the property, we were ready to move on it. We knew that like any real estate deal big or small, when everything lines up right, you have to be quick on the trigger or it will be gone to someone else who doesn’t pause.

We were one of three offers; the other two had done deals with the broker in the past and were known in the multi family market. Despite this ,we convinced the seller to accept our offer. We did this by being willing to pay more than the other bidders. I know you’re thinking, “OK, great, this guy’s purchasing strategy is to overpay?” Yes and no. I’ll explain.

What we realized when looking at several other properties and competing against the high income earners that buy mostly for the tax benefits was that they are not creative because they don’t have to be. They simply run the analysis in a spreadsheet, take the NOI, divide it by the cap rate, and say, “This is what it’s worth. I’ll pay 90%-100% of that.” Because of this type of buying, we realized we needed to see something that others were missing. This building had just what we needed.

Related: How I Went From $100,000 in Debt With No Job to Debt-Free in 5 Years

The property was in great shape — built very well in 1989 by a well-known builder and maintained well. Occupancy was hovering above 95%. BUT we realized three opportunities the others may have missed, which made us comfortable to bid just enough higher to have the seller accept our offer.

In the end, we bought it at 93% of asking price and 89% of the appraised value.

The 3 Opportunities We Noticed

1. Sub Meters

During our walk through, with our background in contracting, we realized the water lines were run individually to each unit for both hot and cold lines with their own hot water heaters in the units. But the property was still master-metered, with the landlord paying a $29,000 water bill each year.

During due diligence, we found that it would cost us only $200-$250 per unit to put wirelessly read sub-meters in each unit for water. This would allow us to have all water billed back to the residents, which is common practice in the area. With rents being slightly below market as they were when water was included, we were confident that adding water bill back to residents would not drive residents out. And lastly, we found from other large investors in the area that total water consumption decreases 30% when tenants are responsible for the cost of water. This means you decreases your expenses X, but you only increase the residents cost of living 70% of X.

2. Storage Units

There were eight total 10’ x 13’ common area laundry rooms through out the complex — only four of which were being used. The others were empty, locked, and the current owner never had the key.

During due diligence, we surveyed every resident and asked, “What would make your living experience better?” We had a large amount of residents request extra storage space, which was not available. We then followed up by asking them, “If a 30 sq. ft. storage unit was available in the building for $29 a month, would you rent it?” We had lots of residents agree. This meant the unused old laundry rooms could be remodeled into storage units for rent. Four rooms were doing nothing as they currently sat, so all we had to do was spend $500-800 dollars to have some basic storage units built in each of them. The other four would come later.


3. Washer and Dryer Hookup

Each unit was equipped with washer and dryer hookups in the units, but coin laundry was the only option available for residents.

After the year or so it will take to transition all residents onto sub-metered water, we will be left with another opportunity in year two to remove the coin laundry from the common areas, fill those rooms with storage, and begin renting individual washers and dryers to each unit.

This process will take roughly 24 months to complete. All the while, we will never raise rents one penny. With our rents only being 17% of of the median household income, we are comfortable even with these additional optional expenses, our residents will not be over-extending their means. Through this, the value of our property is projected to increase close to $425,000.

This is why I now say spreadsheet analysis is a commodity. It is basic math that everyone can do. There are free spreadsheets online to plug in the correct income and expenses in the correct slots, and out pops a value. The real value comes from creativity between those lines — seeing value that has been left unnoticed for years and exposing it.


Through our sacrifices, we were fortunate to have enough money to put a down payment on this property and secure the rest from a local portfolio lender, as I have mentioned at the beginning of the article.

But how do you get a bank to lend you all that money?

We have used the same 2-3 lenders for the entire time we have been in business, but have stuck to one primary lender. This lender is a small, two-branch portfolio lender that we work very well with.

We knew we wouldn’t be the strongest borrower on paper to be asking for the size of loan needed to buy the type of building we wanted. Because of this, in 2015 we decided to move our business accounts into our primary lender not only so that they could see the transactions in detail, but also so that we would be one of their large account holders. With income like cash-out refis from our other properties, we did not have taxable events, and therefore, they never show up on a tax return. However, if the bank sees money going into their accounts and sitting there, they become more and more comfortable.

Once we had the property under contract, we went to our lender to present the deal. They gave us conditional approval for a 75 LTV loan at 4.75% interest, 5/5 ARM, 20-year term. We were pumped! The bank was going to lend us the money! After the excitement calmed, we wised up and began to shop to deal around to our other lenders. After a few rejections and much back and forth with two banks, we end with our initial primary lender.

The loan structure was:

  • 80% LTV
  • 4.25% interest
  • 5/5 ARM
  • 25-year amortization
  • 20-year term
  • Minimum closing costs
  • No pre-payment penalty after 12 months

We pushed very hard to get one of the lenders to 80% LTV. They were very resistant based on the fact that this was our first larger apartment and that our personal financials didn’t look awesome based on the fact that we are self-employed and much of our income comes from non-taxable events like cash-out refis.

After hearing “no” several times on the request to go from 75% to 80% LTV, I offered to deposit the 5% difference (roughly $100k) into a CD at their bank for 6 months. This would allow the bank to benefit by being able to go lend out the CD money and earning more interest on it. Actually, due to the fractional reserve, the bank was allowed to lend out roughly 10 times my deposit. This was an offer they couldn’t resist. This would also give us our money back in 6 months to use elsewhere. Ultimately, we agreed to a 12-month CD. In the end, we were thrilled with the terms we got. There may be better out there, but for our specific situation, these were great terms.


Related: Behind on the Path to Financial Freedom? Here’s the Good News You NEED to Hear

Taking Ownership

After closing on the property, we held a cookout for our staff to introduce them to each other and to meet the residents and answer any questions about the welcome letter we had sent out explaining our procedures. Shocking even to us, we had every single resident pay that first month with no issues!

The business plan continues to chug along just as we predicted, and within in 24 months of purchase, we should be refinancing and pulling all of our cash back out of the investment.

Each Experience Opens New Doors

I hope this article inspires others to stick to their plans, make sacrifices, and chase big goals. At the age of 26, I was able reach my goals faster than I hoped and be a part of an awesome journey along the way.

Now that we understand the process and our team has executed on this transaction, we are actively pursuing larger opportunities. By reaching the point where we are comfortable bringing in equity investors, we are now actively looking for apartment complexes in both the Cincinnati and Atlanta markets up to a $10 million dollar purchase price. To pursue this goal, I even moved across the country to live in the Atlanta area to learn the market, build relationships, and expand our company. This is just another sacrifice I am willing to make to build a secure foundation on which we can create an empire on for many years to come.

Investors: What are YOU doing to reach your goals? Any questions about this particular deal?

Let me know with a comment!

About Author

Jered Sturm

Jered Sturm is co-founder and director of sales and marketing at SNS Capital Group. Jered began in the real estate industry in 2006, working for a successful real estate investment company as a handyman. From 2009-2012, Jered co-founded the construction company Sturm Properties. Using his background in contracting and construction, he began investing in “Value Add” real estate. Now, after co-founding SNS Capital Group, Jered has conducted over 10 million dollars in real estate transactions. He currently co-owns and operates a portfolio worth over 3.7 million dollars in investment real estate.


  1. Ashley Pimsner

    @Jerud Sturm this article on purchasing a multi million dollar apartment complex at the age of 26 is the best example of the hardwork and grit that is necessary to succeed in real estate I have ever read.
    I have bookmarked this post and will refer to it whenever I am discouraged!
    Everything about securing this deal was a product of you doing things that other investors wouldn’t do.
    How many of us write down the exact specs of the types of properties we wish to purchase, make a list compiled of 15 years worth of data, and call that list daily for 3 months?
    How many of us would move to another city in order to purchase an apartment complex 10x bigger than the previous purchase?
    I guarantee you and your team will find and make that deal happen in Altanta because you are willing to sacrifice and do the uncomfortable things required in order to reach your investing goals.
    I will borrow many of the actions you took in this article to help jump start my business, and can’t wait to read about your next deal.

    • Jered Sturm

      Great question! We are projected to have a positive annual cashflow of $41,500 cashflow after refinance at the end of year 2. This could very depending on financing terms at that time and several other factors, but with our best educated forecasting that is our projections.

        • Paula Gayle

          This is a continuation from my previous post.

          Based off my knowledge on refinancing, I believe your decision to refinance and pull out your own cash is brilliant.
          However, I would love to hear from you the expert on what made you decided to go that route. Can you share with me?

          Thank you,

  2. Curtis Rouse

    Great article Jered! I love the fact that you continue to work hard and grow your business. I’m currently in the Atlanta market building my portfolio of smaller MF units and would love to meet up with you one day to discuss both of our businesses. If this is something you would interested in, please let me know so I can reach out to you.

  3. Ariel Cohen

    Great article. Value add is what its all about!

    Recently also had the same experience with a lender while negotiating terms on a loan. Where we started the negotiation and where we ended are so far apart in our favor! Good financing terms are key and can make or break a deal.

    • Jered Sturm

      Thanks Jessie,
      Yeah, my advice is there is no right way to start. Everyone is different and it can be done a million ways. Figure out what you enjoy most and take that route. Many authors on BP are good enough writers they can teach detailed how to lessons on REI. I on the other hand realized the best way for me to teach it to tell my own story and let others pick up bits and pieces and translate those pieces into their own life and investing. I know this is vague, but what it comes down to is follow what you enjoy and what you’re good at, what interests you enough to want to learn more in that pursuit is where you will find your advice.
      If you ever have a specific question I am happy to help if I can. Feel free to reach out.

  4. Johari Hughes

    Really liked reading this article. I’m a fresh 25 and will eventually get into apartments in Oakland, CA and Maryland. Great insight on due diligence. I always love hearing the little things and analysis adding value in circumstances like these. Great article!

    • Jered Sturm

      Great question. It all comes down to costs. There are several reasons that go into cost on both of those items, but in the simplest explanation: problems occur less often, and when they do occur they can be fixed easier and faster which in turn costs less.

    • Jon Le

      Yes. Flat roof can be a headache, esp w gravel and tar or some old technology. We’ve recently put Versico TPO roof on our buildings flat roof and it’s been great so far. USC, sheriff’s office, Costco, Walmarts, etc use this on their flat roofs. Pitched roof is still a little better because that usually means there is room for insulation. I’m in Southern California and it does get hot

  5. Great article Jered, one of the youngest ages I’ve seen Aswell. I’m 24 and only have 90k so far (only in crowdfunded property at the moment) and 0 knowledge in the field, so I won’t be beating you, but I’m looking to get started in property investment in 2-3 years once I’ve got more capital and have a lot more knowledge in the field.

    Great article, once again :- )

  6. Duke Marquiss

    I grew up on a ranch 45 miles from town and 12 miles to the nearest neighbor. I learned what I call “Bunk House Logic”. My dad would always answer a question that I asked with, “Figure it out.” It appears that you have “Bunk House Logic”. There is no book that will tell you what you Figured Out. Great job. Keep it rolling!!!!

  7. Ben Wendt

    Hi Jered, an excellent story with some good nuggets hidden in there. I also commend you for responding to each comment that is left. I know that I particularly appreciate your story of how you started out and am proud for where you’ve gotten.
    I’m curious though, is $40K annual cash flow on a property as expensive as the one you purchased normal? It strikes me as a little low, although I suppose you can pull out the equity you put down to get the apartment and move into other deals. How many units is your recently acquired complex? I think that will help build the picture in my mind a little better.
    And a sincere congratulations!

    • Jered Sturm

      Thanks Ben, the 41k will be after we take all of our cash back out of the deal and refinance. So at that point our return on investment becomes infinite because we no longer have money in. We also anticipate a slight bump in interest rates so that additional bump in DS eats into CF as well as we understand through year 1 and 2 we will be running the property as lean as possible keeping costs as low as possible to boost value. After the refinance we settle in a little more and are able to run the property with out pinching each penny so hard. Which in a long term buy and hold ultimately leads to a better investment. We take all of this into account. So in year 1-2 CF looks much more appealing than the 41k. After we get our money out returns look awesome. For a little more on the concepts check out this article where I dig into a general example but show a bunch of the math concepts.

      But to clearly answer your question: There is no normal. For us putting 425k into the deal and seeing 41k back means we are very close to a 10% COC. year 1-2 will look stronger but the 10% is the longer reality after we take on more debt.

    • Jered Sturm

      Thanks Cliff, Maybe there is a better way but I don’t have anything too out of the box. I looked at listings and called. I would always ask ” now that you know what type of property we are looking for is there anyone else in the industry you think I should be reaching out to?” I’d ask that to everyone (brokers, insurance, lenders, etc) I talked to this way I started getting a web of people instead of just people that currently had something listed online.

  8. Saverio Nestico

    Great article and thanks for the insight

    Question – not sure if I completely understood about the Fractional Reserve section… if the Fractional Reserve is 10%, how was the bank able to loan out “roughly 10x of my deposit” ?

    How was he able to withdraw the money after 12 months when it was earmarked for the 5% down payment injection ? Was the balance then adjusted to increase by the additional 5% ?

    • Jered Sturm

      Thanks Saverio,

      Ah the fractional reserve.. it is our governments way of printing money with out actually printing money. I could have worded that part better because Its not that bank directly but the flow of that money through the fractional reserve banking system as a whole that multiplies it. I do a bad job of explaining it Here is a video that does better.

      we are able to take the money out of the CD after 12 months because the length of the CD was 12 months. The CD and the loan were not directly connected. The deal was they will loan 80LTV if we deposited 100k in a 12 month cd. After 12 months our money comes out and we keep the debt exactly the same. Actually the the debt was not even secured against the CD at all. So in the very unlikely event the bank would foreclose within the first 12 months we would loose our 20% down payment but the 100k CD would not be effected.
      Actually a cool part I did not include in the article was the bank actually let us secure a business line of credit against the CD.

      I hope that answered your questions.

      Thanks for commenting!

  9. Sandra bean

    Jered…..Ienjoyed your article. Very enlightning. Read all of the responses and learned quite a it. However I am at the other end of the age spectrum.retired. Since I am relocating to Cincinnati and looking to buy a few multi-family houses I was interested in learning more about your construction company in regard to rehabing . How do I contact you?

  10. Kerry Baird

    Look at all those juicy details! This post is so detailed that it creates a compelling picture of the process to buy a multi-family apartment. I enjoyed reading about how you did the hard thing of picking up the phone to call…a process that becomes easier the more you do it. The financing portion is the aspect that many of us are challenged with, so resonated with me, too. I appreciate the no-fluff article on how you experienced success with this apartment.

    • Jered Sturm

      Glad you had good take aways John. I found I am not the best teacher in the standard sense, but I tell my own story hoping others can pick up insight and learn that way. Glad to hear it seems to be working. Thanks for commenting.

  11. Kevin Myhre

    Congratulations Jered! What an amazing story. You are living my dream. The Cincinnati area offers a lot of opportunity. Picking up on the fact that there were separate water meters was gold! Can’t wait to hear more about this deal and others to come. Keep up the great work!

  12. sri ram

    Congrats Jered. Great inspiration story. Actually you article inspired me to check and discuss a potential deal with a local bank.
    Good analysis of the hidden value addition which you cannot get from the EXcel sheet. Smart thinking/creative ideas. Looking at the outside box potential. Great article.
    Should connect in Atlanta, to look at some syndication deals. I am coming to Atlanta as my kids are going to go college there.

    • Jered Sturm

      That sounds like a great future blog post.

      Boiled down version would be I like MF so much better because it offers more control. I like being able to steer the investment. In MF you can force appreciation in a much more predictable, controlled basis, rather than in SFR letting the waves of the market toss your investments performance. also easier to purchase, and manage.

  13. Kevin Saunders

    Great article. Embarking on a similar path here in Cleveland. One question–what is it about Atlanta that has caught your eye? Specific demographic benchmarks? Gut feel? Curious as to how one goes about identifying remote markets to expand their investment portfolio. I realize you have since moved to ATL, but what was it that originally caught your eye?

    Any info is much appreciated.


    • Jered Sturm

      Thanks Jon! My back ground is in construction so I understand the processes in detail but no Idid not do much construction work on this new property at all.

      We have a maintenance man and resident manager on staff to support the operations. They are overseen by my partner who fills the asset management roll in our business.

  14. Drew Pak

    Amazing story, I am a investor in SFR and small multi-family and in a similar situation with you. Economic degree, with a background I in construction from my father, as I like to call myself a college educated economist that knows how to swing a hammer.

    A few questions about your journey.

    1) I was wondering how you and your brother decided to make the transition from smaller units 1-4 units and SFR to larger units. As I am headed down this path but don’t have a partner or mentor to help me with making this transition.
    2) I have normally employed a model of paying down debt and allowing to cash flows to build up before taking on additional leverage I am normally only at 30% of debt to equity. For example I have 3.5M in portfolio value but only 1.2M in outstanding debt.
    3) Would you recommend taking on additional leverage to secure larger properties, and could you help explain the benefits of cash our refi and when you normally decide to pull out cash and why?

    Currently I have a re

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