Creating an Investment Proposal? Help!

[Joshuah Murray]

Hello everyone, I’ve got a multi family property under contract and have been weighing my financing options (from owner finance to bank loans etc). At this point I have garnered the attention of a few private lenders and have discussed my ideas with them enough for them to request a proposal. I have no idea how to organize my numbers, thoughts etc. into a proposal. Does anyone have a template or outline for putting this together? Any help would be great!

[Kyle Bryant]

It kind of depends on the size of the deal and the level of involvement your private investors will have. But if this is just a proposal to familiarize them with the deal, you might consider structuring your proposal like a business plan. Consider including (at a minimum) the following:

1. Details of the property (size, location, makeup of units, etc.)

2. Your plan going into the property (is this a repositioning, value-add, appreciation play, etc.)

3. Your management plan for the property (self-managed, property manager, etc.)

4. Your pro forma P&L for the life cycle of the investment

5. Your exit strategy

6. What role the investors will play (passive, active management of the asset, etc.)

7. What your projected returns are to the investors over time.

I'm sure I'm leaving several things out, but that should give a broad idea. Depending on your deal structure (well, most likely regardless of structure), you'll want to speak with an attorney to make sure you draft the right documents and comply with all necessary regulations concerning these types of investments. 

The main idea is that you want all the relevant info in a concise, understandable manner. Organization and preparation will help garner trust that you can execute on your plan. Best of luck to you!!