Starting out - Apartment Syndication - Large Multifamily Deals

[Justin Haughton]

Hello BP Family - has anyone started their real estate career in large multifamily deals? If so, I'd love to hear your story. When it comes to using bigger pockets as a medium for finding passive investors in large deals - what rules must be followed? Moreover, how poised is this community toward larger deals like 100-300 unit complexes? From what I've seen a lot of the content has been for single-family or small multifamily (2-4 units). What I have heard from people who are in large multifamily now - is that their biggest regret is that they didn't start sooner because it's easier to scale.

Here's a goal I made in light of my pursuits: 

Within 2 years, I will buy 300+ MF properties in the/outside the (still determining area - maybe Plano, Texas) area that will earn an average annual return of 15%, double investor's money in 5 years or less, and will earn me an additional $30k per month net income (after tax).

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I have heard repeatedly that focus = power. On one hand, I want to focus my attention on being able to get into a 2-4 unit house hack (I spoke about this in a previous post I made)- but at the same time, I want to learn large multifamily and ultimately be a GP, build a team, and syndicate my own deals. If I divert my attention to both I think I would be worst off than if I were to choose one and give it my full attention. Would love to get the BP community's thoughts on this.

My very best,

Justin

[Bruce Lynn]

#1....as a new investor...you probably need to bring some of your own capital to the game.   Good investors want to see you're in it with them.

#2....I would guess most, but not all syndicators get started with friends and family....especially on the 1st 1-2-3-4 deals.....so how confident are you mortgaging your home to go all in....cashing in all your retirement savings.....and putting at risk your parents retirement money, your grandparents house, your uncles business.   If you're not confident about doubling their money, don't go out and raise it from others.

#3....I would guess the majority of the investors on BP are not putting $50,000-$100,000 or more in syndication deals.   There are some, but I would probably not just think you're going to go out and raise a significant amount of funds off the internet from people you don't know on your 1st deal, or the 2nd, or maybe the 3rd.   

#4 I think your local REIA in LA is getting ready to ....in FACT tonight is the night you want to go....HOW TO GET STARTED IN MULTIFAMILY..... is the presentation tonight....check it out.... https://lareic.com/   tonight 6:30-9:30pm  
3376 Motor Ave     Los Angeles, CA 90034

#5  Plenty of discussion on here about different multi family networking/eco system groups.....go to one of their conferences....2-3 days of non-stop education and networking.....and I think you can figure out if that plan is for you 

I think starting with small personal deals and going thru all the pains, trails and tribulations and potentially successes give you excellent training for larger deals....but there are people who skip all that and go straight to big or giant deals......how good are you at underwriting, how good are you at vetting tenants, how good are you at PM, how good are you at renovations.....how good are you at raising money for other ventures....how are your presentation skills for convincing high net worth people to work with you....how much money do you have to get started....how good are you at finding, hiring, managing contractors.....how good are you at managing thru tough times.....like right now where lots of syndicators have their backs to the wall, cutting off distributions, going back to investors for cash calls, renegotiating loan deals....Last 5+ years everyone looks like a freaking hero....generating 30-60-100% returns.  It was all jets and limos...and Ferraris.   This year and maybe next will not be fun for many people....it may be back to sleeping on the floor of vacant units during property visits to save money.  Might be eating vending machine snacks for lunch in the managers office.....might be becoming an expert at where to find and install shark bites yourself when pipes freeze.

Take all this as motivation....to do what others can't

Good luck and best wishes.