How do you locate good MF deals?

[Christian Carson]

Hi all,

I have been trying to get into an underperforming apartment building for a good 6 months and am having a heck of a time finding one that isn't grossly overpriced in my area.

My specific neighborhood has probably 100+ 6-15 unit apartment buildings that are always fully rented at premium rents and are NEVER for sale--I imagine because they're such good cash cows! The handful of places listed on LoopNet, across the entire metro area, are either (a) in the ghetto or (b) contain misleading NOI estimates (most commonly I've seen sellers omit the maintenance budget entirely from their calculation).

I'm frustrated enough with dealing with agents that I'm considering going on a letter-writing campaign to try and draw out the little old ladies who want to dump their headache apartment buildings. Has anyone had any luck taking this route with apartment buildings? Any other tips?

[Uwe S.]

Chris C. your knowledge about Cleveland is very good I stated in an other topic. But you wrote also you never crossed the west border maybe thats your problem :).

I for one found enough mf deals in last two years on west side. Look at the scared seller/owner and you will find these guys.

-Uwe

[Christian Carson]

Uwe S., lol! I have been really interested in Lakewood. I have seen good deals but they don't last long at all. Is there another resource besides LoopNet that is worth checking on?

[Steve M.]

Chris,

Do you have access to an MLS?

You'll find much of the stuff you'll find on Loopnet, but quite a few agents around here skip loopnet altogether and just run their inventory on the MLS.

[Christian Carson]

Steve,

I don't have personal access to the MLS, only Zillow. I do have several agents who are (supposedly) checking up for deals that come by, but pretty much any time I hear from them is when I contact them about a property. I understand most agents' lack of motivation to help me because I'm young and because I do far more research on properties than others which makes me pickier.

I've been thinking of getting a RE license since my second business will eventually require it. Is there an easier way to get direct access, or am I totally at the mercy of agents?

[Dale Osborn]

Check for a Hendricks & Partners website for your area. They are the first name I can think of that deals only in MF apartments. There are several others - if you did a search through the archives you would find the thread that mentioned several different brokerages that just specialize in apartments. Another thing you need to consider is many of the commercial agents work with pocket listings. They take the listings and sit on them only contacting those on their list that are currently seeking apartments. You need to get in touch with these agents and let them know you are actively seeking something to buy.

[Steve Babiak]

For more that 4 units, zillow and MLS won't give you much if anything, as they are for "residential". 5 and more units are considered "commercial", so loopnet and costar are the common sites used there. Dale offered a good suggestion as well.

[Steve M.]

Originally posted by Steve Babiak:

For more that 4 units, zillow and MLS won't give you much if anything, as they are for "residential". 5 and more units are considered "commercial", so loopnet and costar are the common sites used there. Dale offered a good suggestion as well.

Really Steve?

Perhaps we're just lucky here in middle TN -- But the MLS here includes Residential, Land, Multi Family, & Commercial.

Even looking for office space -- I look to the MLS prior to searching out Craigslist or Loopnet.

[Steve M.]

Here's the "Retail/Consumer" frontend of our MLS system:

http://www.realtracs.com/PropertySearchMap.aspx

As you can see, this doesn't just include residential.
http://www.realtracs.com/ChoosePropertyType.aspx?AreaID=9&PropertyClass=RES&Digest=BxMlNjef8ddUFzkwS1KW5Q

Backend is like any other MLS.

[Joel Owens]

Hi Steve,

I do not know about Tennessee.I can tell you in Georgia while there is a commercial section in the residential MLS it is highly limited in scope and mostly mom and pop type stuff.

Occasionally you will see a decent property to look at but for the most part the commercial brokerages aren't even a member of these local MLS's.

Most use Loopnet,Costar,the local commercial MLS in the area.The brokers will usually shop it to their buyers first and also other brokers they know can close a deal.

They give them first crack at it and then open it up to all of OTHER buyers who MIGHT can perform.Marketing to the unknown purchasers is the last on the list.

[Steve M.]

Yeah,

I believe Mid TN is a bit different.

Just checked Loopnet -- (3) MF's in Hendersonville. Checked MLS -- (14) listings.

[Steve Babiak]

Originally posted by Steve McVey:

Originally posted by Steve Babiak:

For more that 4 units, zillow and MLS won't give you much if anything, as they are for "residential". 5 and more units are considered "commercial", so loopnet and costar are the common sites used there. Dale offered a good suggestion as well.

Really Steve?

Perhaps we're just lucky here in middle TN -- But the MLS here includes Residential, Land, Multi Family, & Commercial.

Even looking for office space -- I look to the MLS prior to searching out Craigslist or Loopnet.

Never looked at it as closely until you pointed this out, but you are correct:
http://commercial.realtor.com/

[Christian Carson]

Thanks for the informative replies, everyone! I did find some extra properties that I'd missed before on the commercial MLS. I'm going to start calling the selling agents and have them put me on their list for pocket listings.

[Duncan Wierman]

Under the Freedom of Information Act,

you can download excel spreadsheets with over 100,000 names of multifamily properties, their owners, when they bought the properties, how much they paid, when the notes are coming due, and so on and so on.

Its a goldmine of where to "shop"

[Dale Osborn]

Duncan Wierman where exactly is such a list available for download?

[Jon Holdman]

Duncan Wierman, how does someone get these "excel spreadsheets with over 100,000 names"? I know I can extract such information from county records. But its not an excel spreadsheet.

[Colleen S.]

Do you have a local MFH owners association in your area that you could join? I was a member in the Twin Cities area when I was into MF and it was a great way to hear about upcoming deals as well as network for maint. prop mgmt etc.

[Paul Khazansky]

Originally posted by Duncan Wierman:

Under the Freedom of Information Act,

you can download excel spreadsheets with over 100,000 names of multifamily properties, their owners, when they bought the properties, how much they paid, when the notes are coming due, and so on and so on.

Its a goldmine of where to "shop"

Hey Duncan,

Where can I find such a spreadsheet? Thanks in advance!

-Paul

[William R.]

I would also be interested such a list.

[Brian Sorensen]

A title company should be able to provide spreadsheets like this for you at about 10 cents a name.

[Igor S.]

Christian Carson, I am in the same situation. Own a 6-unit in a great location with premium rents. Only problem is, there is never another one for sale. I've scoured the county tax records and am planning on contacting the other owners to see if anyone is interested in selling. Haven't figured out the best method for this, phone call? letters? etc