After a 7 year successful rei run and crash, need to regroup, and restart. Asking for advice.

[Peter Matthews]

My bus. partner and I are working on a restart of our rei business. Any advice appreciated. Btw, we know the mistakes we made, so no comments needed there... :)

> SCENARIO:

1. We built mostly SFHs from 00-07 in central NJ. We did a range of projects--rehabs, tear downs, sub divs, and condo conversions.

2. We started very small, self financed using the unrealized equity as collateral, and did not need HMLs. We felt we were conservative with assumptions.

3. When sales stopped and credit tightened we were hit hard. We missed the big red flashing warning signs!

4. My partner has moved into our latest project, to hold it until there is some/any market improvement. There is no equity to leverage.

5. Our credit and cash has been hit hard.

6. We are optimistic about a restart, but have serious constraints.

This is where any advice I can obtain here comes in.

> OUR PLAN:

1. Stay optimistic. We still believe in the potential. Adjustments to market are required. We have to find a way to make re work for us again.

2. Diversify. Broaden our options to include buy and hold, lease-purchase, in addition to new const. and rehab.

3. Move to smaller house footprint to improve rental and sale prospects.

4. Add MF to increase cash flow.

5. Seek/find partners willing to fund on a money cost and/or equity share basis.

6. Look into more off road approaches - equity trusts, etc.

7. Create a cash mgmt plan with a reserve contingency (lesson learned--whew).

> OUR ASSETS:

1. A solid set of contractors, proven over multiple years.

2. Documented profitable projects.

3. High level of knowledge of construction, market (in our geo), zoning, codes, and planning boards.

4. Ability to find projects now. We are simply having to pass on them.

> OUR CHALLENGES:

1. Credit way below current requirements for BF.

2. Insufficient startup cash to show an HML we have 'skin in the game' or working project needs (rehab etc).

3. Since we have not used HMLs over the 7 years, no relationships with same. In today's market, an HML wants a proven track record with him/her to lend. We have been unable to id an interested HML to date. Plenty of brokers with time wasting promises!

4. Constrained to this geo. Circumstances prevent a move to more attractive areas.