All Forum Posts by: Greg Dickerson

Let's say I want to tear down a SFR then build a small Multifamily on it. Are their bank or credit union options typically available for something like that? If so, what are they?

Am I even asking the right question? How do others go about financing something like this?

Yes there are lot's of banks and options for funding including using private lenders. It will all depend on your experience and financials. I would not recommend using hard money for new construction especially just starting out. Private lenders are ok but not hard money.

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Originally posted by @Benjamin Pifer:

I'm having trouble landing any good deals in my area. I've put in offers/bids but have been beat out every time. Properties are basically selling for more than what I would purchase them for for decent cash flow. I'm starting to wonder if I should try building my own multifamily instead of buying. I have a little bit of an advantage. My grandfather bought 14 acres of land about 15 years ago and had it divided up and zoned into multifamily and commercial zoning. He also put in infrastructure including paved entrances and all the water/plumbing for the land. He passed away before finishing developement and it now belongs to my father who has been open to the idea of basically giving me some of the land to build on. I have a decent chunk of cash from inheritance too. I'm starting to think it might be a good idea to just build there instead of buying something built. My main concern is how to figure out the cost of building so I can know if it'd be a good deal. It seems more difficult than just running the numbers on something already built. Any thoughts/ideas from anyone who has built their own multifamily? How did you figure out the costs for it? Thanks in advance!

You need to reach out to some builders in the area that build these type of buildings to get an idea of current costs as they are up significantly right now. You also need to estimate rents and operating costs to determine NOI at stabilization to make sure the project will work.

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Originally posted by @Andrea Cole:

Hello all,

I am considering a rural, commercial tiny house development to be used exclusively for short-term rentals. I am mostly aware of the work that needs to be undertaken for any given area in terms of zoning, deed restrictions, IRC, etc.

For business plan purposes, I am needing paid, professional assistance to provide high-level descriptions of required elements, along with cost estimates for the development of infrastructure and site planning, optimized for efficiency (house structures themselves are already designed).

I would use the same consultant to later produce plans with all granular detail and modifications based on land choice, then assist in the execution of the project.

Question: what professional would I seek out for a consult: architect, civil engineer, builder, developer, etc.

Thank you for sharing feedback based on your experience with this type of project.

I started my development career with short term rentals. There are a lot things you need to know and take into consideration. You need someone to teach you how to be a developer and work with / negotiate with all of the professionals involved in the project and process. You can lose a lot of money fast In this market right now because everyone is so busy. Costs are up, fees are up and time frames are up. Good news is financing is cheap and demand for short and long term rentals is off the charts.

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Originally posted by @Anna Smith:

Hello Fellow Investors,

I need advice as to how to qualify and find a lender in SW Florida for land or land/construction loan for multiple lots (portfolio/commercial loan?). Also what should I expect in terms of underwriting and closing time? I have about 2 weeks to close.

Thank you kindly!

Best bet will be to contact several local commercial banks. They Well want to see your complete financial package, rates and terms will vary depending on the bank, your experience, and your financials.

1 Vote

Originally posted by @Mike Ritz:

I am looking for any insight into commercial and multifamily build costs outside of Minneapolis, MN. I have two separate commercially zoned lots that I would like to develop (one retail or other commercial, one multifamily). I am interested in connecting with possible partners or people with experience who might advise on building costs and potential pitfalls. Thanks in advance!

There are a lot of variables involved to be able to answer this question. Your site and requirements, location, type of construction, level of finishes etc. The best thing to do would be to contact some local general contractors that are building a type of project do you want to build and get current cost information from them. You are going to need some idea of what it is you want to build first before reaching out.

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Originally posted by @Bernard Sanga:

I am looking at a few listings of professional office buildings with very high vacancy in Tampa FL. It is well located and I have capital for 50% downpayment. I have no idea how lending in these type of properties work. Can anybody point me to the right direction in terms of resources to know more?

Also, any commercial real estate agents or property managers in the group who specializes in office space who live in Tampa?

Would love to connect!

It’s going to boil down to your financials and experience. The more experienced you are and the stronger you are the better the terms. You will want to shop multiple lenders as they all have different appetite for these loans.

1 Vote

Originally posted by @Joshua Rountree:

Hey BP! I have a investor friend that has a deal under contract and is trying to decide what to do with it. He has a unique situation where he can either do a traditional wholesale to a off market cash buyer through our local investor network, or go to market with the property and seek a buyer that way.

This property needs a pretty hefty rehab and at least for a newer investor like himself it's a pretty daunting task and he has decided to let someone else worry about the rehab. So what would you do? Try to network with local investors and get an off market cash offer? Or put it on the MLS and let the Market decide. Wholesale VS Wholetail?

It’s all about the numbers. He needs to determine which strategy will bring the most. The market is red hot so he will likely get a cash offer on the market as well. Let the numbers be your guide

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Originally posted by @Terrence Evans:

Hi all,

This is not my normal forum but I was curious if someone could give me insight into modular homes. (Not mobile/manufactured homes) I want to understand what the total costs and concerns are. I am not a builder so I have that disadvantage but I am familiar with many of the pieces that go into a home. I am an engineer so I can figure out the details. The markets that I am interested in perhaps using modular homes are in S. California/Vegas and in Indiana. So if you can give me some tips or resources / websites I can look at to educate myself that would be great.

Modular is not always cheaper but can be faster. Depending on your exit strategy it may or may not be the right type of construction for what you’re looking to do. There are varying levels just like in stick built. Modular can be a good strategy for rentals but not necessarily fir resale in many markets as there is still the stigma in some areas that the product is not as good as stick built.

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Originally posted by @Zachary Cook:

One thing I'm trying to understand before doing my first raw land development - subdivision deal is at what point in the process are you first allowed to sell the lots. That seems like it would be an important factor in understanding the entire timeline and your exit strategy - to know when it is you can sell the individual lots.

Specifically when is the earliest part in the process end consumers can put them under contract and if those clients have traditional financing would you typically need to have your final plat recorded before they can close?

For some context, I'm learning about land development preparing to do my first deal while I work a day job where my clients are purchasing lots from developers all the time. I sell new construction manufactured homes where very commonly they're purchasing it with land at the same time.

For example, see below two advertisements for newly subdivided land that typically marks when we start selling these to individual clients. Do you believe the land developers are putting these out at the preliminary plat approval stage?

That's what it looks like to me. Then if so, isn't there a chance that you don't get final plat approval and then what would happen then?

Thanks everyone for your help!! Its a lot of work preparing to properly do your first deal I'm trying to get a clear understanding of this process.

Correct. You can not convey individual parcels until the final subdivision plat and parcels have been recorded.You can take non binding reservations which is what we often do as developers with builders or buyers depending on the size of the project.

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Originally posted by @Brad Annen:

Looking to connect with investors that have experience with new construction MFH (2-4) specifically in St. Louis and other markets. Just hoping to chat and learn about your processes and experiences when getting started

First step is to study the market and make sure your understand rents, demand, construction costs etc. You can learn a lot from realtors, PM companies and talking to builders and investors in your area doing these types of deals.

1 Vote

All Forum Posts by: Greg Dickerson

Greg Dickerson has started 4 posts and replied 4649 times.

Post: Financing a New Build

Post: Building Multifamily instead of buying

Post: Tiny House Village - Short-term Rental Model

Post: How do I find a local commercial real estate lender?

Post: Commercial Build Cost Estimates

Post: Vacant office buildings in Tampa

Post: To Go on market or off market? That is the question

Post: Looking for informed opinions about modular housing

Post: At What Point in Land Subdividing Process Can You Sell the Lots?

Post: St Louis New Construction Duplex