How to Find Off-Market Apartment Deals

[Michael Ealy]

Most of my off-market deals come from real estate brokers. Because of my track record and reputation,brokers come to me before they list their buildings. I follow through and close on every deal I put my EMD on so I never run out of deals.

But, in preparing to give a seminar on how to succeed with apartment investing, when I look back over the 20 years I've been doing it, I realize I have used many ways to find good OFF-deals. Here's one:

TALK TO PROPERTY MANAGERS

Why You can Get Good Off-Market Deals from Property Managers - PMs and property management companies know the different buildings in town and some are hired as "receivers" in a foreclosure situation for example. A few PMs will know of owners who are running out of cash (maybe because of a critical illness or personal problems not related to the building) or they just took over a building that has been mismanaged by a previous PM.

If you can talk to enough PMs and show them you have the experience and financial capability to take down apartment deals, then a few of those PMs will call you if they have owners who are thinking of selling (of course, they will not share info with you until they get the owners' permission first). 

An Actual Deal Brought by a PM

One of my earlier deals in my career is a 30-unit building in Over the Rhine area of Cincinnati. The owner was quite motivated and the Property Manager of the building brought it to my attention. I struck a deal with the owner to buy the building via land contract and I just take over the management. $0 down deal.

Here are the Numbers:

"All in" Purchase Price and Rehab: $170,000

Re-sale Price: $285,000

Profit (not including cashflow): $100,000+

Time frame: about 2-3 years (I don't even remember exactly by now)

So what about the experienced apartment syndicators out there? What ways other than real estate brokers referring you deals have worked for you? Please share it here so other apartment investors can benefit. Calling on @Ben Leybovich, @Alina Trigub, @Brian Burke, @Greg Dickerson, @Tj Hines, @John Casmon, @Ola Dantis