Who own apartments in the Bay Area?

Question

Hi guys, looking to network with folks who have apartment properties in the Bay Area (not out of state). Would like to see how their properties are doing and share ideas. Thx.

Account Closed · Answer

Account Closed,

Man, you’re full of 💩. $500/unit/mo or more of cash flow? What are you smoking, or are you still having a hangover from the ride in the P100D? I was repeatedly told by the Bay Area and LA based TK providers and marketers that there’s no cash flow in the Bay. You have to go OOS and buying TK is the way to go. I guess if you keep repeating it enough time, people will believe it’s a fact. 😜

You talk about pie in the sky number without 💩 to back it up. Why don’t you get those buildings turnkey and sell them to our local folks with $500/unit/mo of cash flow, then we will believe it’s true. 😂😂😂

Did you get that $100M+ figure from Johnson? Man, he’s really short changing us. If you think about it, $100M is not a lot. That’s about 300-330 units in San Jose, maybe a little more doors in Oakland on average. It’s about 250 doors in Sunnyvale and 220 doors in Mountain View. Can you believe Anthony just sold his building just shy of $700k/door in Redwood City? Madness.

Folks, no one is going to hand you their cash flow including the TK providers. You have to either pay for it, or earn it through value-add. You’re sitting on gold right here at home. Gold doesn’t just lay on the ground all nice and polished for you to pick up. You have to dig for it, polish it up, then you get to reap the rewards.

Another Happy Day, whatever today is.

Account Closed · Answer

@Akaljot Cheema

Pros - cash flow (if you add value), massive appreciation (if you hold long enough), best rent growth in the country (can take a so-so investment to great real quick), easy financing (banks love solid bay area apartments), expensive (this is a pro actually - high barrier to entry keeps competition low)

Cons - tough landlord laws that are getting tougher every year, expensive (high price per unit vs rent received)

The pros far outweigh the cons. Cash flow is very possible here if you add value. I'm talking $500/unit/month or more. Massive appreciation beats any OOS investment any day of the week. Rent growth is the real kicker which no one really talks about.

I am part of a local mastermind group, about 10 of us. Over $100M in real estate owned. We all cash flow immensely, and most of us started only 4-5 years ago. It's very possible here.

Account Closed · Answer

There's no one size fits all. It really depends on what type of loan you look for.

1) Low LTV = First Republic Bank including IO loans for 1-4 units.

2) Max LTV with a slightly higher rate = Luther Burbank, Opus Bank and Chase. Chase can turn on and off the faucet at anytime so it really depends on how much loan volume they need. Once Chase turns on the faucet, it's hard for other banks to compete.

3) Bridge loan = Avid Bank where we talk directly with the underwriter and have a loan approval over lunch or when we leave his office. He is so flexible that we don't want to work with any other banks. In fact, he has extended long-term loans to us in the recent years. I have also used Bank of the Orient for a couple of bridge loans before, but our contact there has left the bank.

4) No doc loans = East West Bank. I heard other Chinese banks such as Cathay and China Trust also do no doc loans, but I don't have first hand knowledge like EWB.

5) First Foundation is also really competitive in the MFH space.

By the way, we can close a loan on 5+ units in 17 days. For folks who say we need 45-60 days to close a commercial loan, they have no clue what they're talking about. :o)

Best of luck.

Adrian Chu · Answer

Who are your favorite lenders in the Bay Area?  Would like to learn more about what their loan programs are like (DSCR, how they calculate DS, rates/terms).

There's no one size fits all. It really depends on what type of loan you look for.

1) Low LTV = First Republic Bank including IO loans for 1-4 units.

2) Max LTV with a slightly higher rate = Luther Burbank, Opus Bank and Chase. Chase can turn on and off the faucet at anytime so it really depends on how much loan volume they need. Once Chase turns on the faucet, it's hard for other banks to compete.

3) Bridge loan = Avid Bank where we talk directly with the underwriter and have a loan approval over lunch or when we leave his office. He is so flexible that we don't want to work with any other banks. In fact, he has extended long-term loans to us in the recent years. I have also used Bank of the Orient for a couple of bridge loans before, but our contact there has left the bank.

4) No doc loans = East West Bank. I heard other Chinese banks such as Cathay and China Trust also do no doc loans, but I don't have first hand knowledge like EWB.

5) First Foundation is also really competitive in the MFH space.

By the way, we can close a loan on 5+ units in 17 days. For folks who say we need 45-60 days to close a commercial loan, they have no clue what they're talking about. :o)

Best of luck.

Thanks for sharing!!

Ray Rodriguez · Answer

@Tony Lin I am a local real estate investor as well. Let’s connect. How are your properties doing towards the recovery of this pandemic? We are finding rents are slowly coming back

Adrian Chu · Answer

Who are your favorite lenders in the Bay Area?  Would like to learn more about what their loan programs are like (DSCR, how they calculate DS, rates/terms).

Carrie K. · Answer

Would love to be part of this, thanks.

Jim G. · Answer

@Tony Lin this is a good idea. I own a few SFHs and trying to branch out to multi-family.  Want to connect and learn.

Akaljot Cheema · Answer

+1! new to the scene but would love just to get more information about the pros and cons of multi family here in the bay area

Raju Balakrishnan · Answer

+1 I would like to connect to multi-family investor here as well.

Who own apartments in the Bay Area?

Most Popular Reply