Looking to expand my family business through the knowledge here!

[Andrei Stegger jr]

Hello all,

As stated above, I would like to acquire as much knowledge as i can on how to expand my family business. My grandfather raised me working on his rental properties through childhood. It has now come to a time where I would like to further re-invest and also invest in new properties. My grandfather is 88 years young but his traditional mentality is keeping us from building upon what we have. We currently have 18 units clear of debt but they are definitely out of date. I was hoping someone has some knowledge they could lend me on what steps i should take. We will be creating an LLC for assett protection soon (our lawyers suggestion), but some of the plans i've come up with include:

1. taking one of our properties and doing a cash-out refi to pull the equity from that property and using it to rehab 2-3 of our properties and repeating the process as many times as needed to completely rehab all 18 units to modern day specification keeping tenant grade budgets in mind. This way we can maximize cashflow and nearly double our income now.

2. Im not sure how any of this refinancing or HELOC work but another thought was to present to the banks our portfolio and maybe they offer a HELOC based on the total portfolio equity and use that to re-invest into all the units.

Please do correct me if I am wrong. As i stated, we currently run 18 units. I have been working on these houses for 20+ years now but i have no knowledge on actually investing into realestate and at this point in my life I have turned my attention soley on expanding through renovating all current properties to double income and maximize cashflow. Any knowledge would be greatly appreciated.

Thank you for your time

[Dawn Brenengen]

If it would truly double your rents, then I would recommend some immediate upgrades, but are you sure your numbers are right?  Usually, rent is driven by location and size for the ost part.  Upgrades play a part, but don't usually increase to double the rent unless you are talking about a gentrifying area. 

I usually upgrade over time.  As the old white fridge breaks, change to stainless.  Replace worn carpet with laminate, etc.