Group's strategy for 2014, SFR's multi-family or Motel?

[Naveen Desai]

Hi,

I am part of a group of 7 people who all started out in Real Estate in 2010 by pooling in money. After 3 years of being together, & due to job and location changes, we all have now operate individually, but still meet together for brain storming, strategy discussion and exchange ideas and deals. Sometimes we still partner depending on the deals etc.,

So, earlier this week, we met to discuss on what should be the strategy for 2014. Our previous model of flips were buying off the auction websites, rehab and resell. That model does not have returns anymore. It worked well for 2010/11. Since early last year we shifted to buy-hold and rent properties out.

Couple of thoughts that were thrown out:

Now that each of us have built equity, we can pool again to buy apartment complexes of 60-70 units. Immediately another person suggests, if pooling in money for huge investments, then why not a Motel?

Looking at these options, I was of opinion that we can put down payments for both projects and work on both together. A lot depends on how much we can collectively bring together and the group's expectation of returns, cap rates.

It ended up being a good 2 hours brain storming and we dispersed stating that for either apartments/motels, we have to do lot of research and we will focus on that. So nothing is going to happen immediately.

In the same lines, I want to get some insight and opinion of folks on here.

How different is Apartment complex investment and Motel investment.

Excluding that they are different operations, what are the factors to compare and come up with list of advantages/disadvantes of each, that will help a group decide on next step?

Thanks in advance for all your inputs.