All Forum Posts by: Brian H.

I thought you were referencing some public option on here.

Can you point me in that direction so I can see how they have it setup @Michael Baum

We have experience purchasing properties through our LLC using lending, where we own 100% of the properties. However, we are now exploring opportunities to bring in passive investors to help accelerate our portfolio growth. Our primary goal is to retain as much equity in our properties as possible while leveraging outside capital to scale faster.

Proposed Investment Structure:

• Investors contribute 30% of the purchase price and 30% of furnishing/rehab costs.
• Our LLC secures a new purchase loan in its name only, taking on 100% of the debt.
• This structure allows us to maintain 70% ownership of the property.
• Properties will be actively managed to maximize returns, likely achieving higher upside than long-term rentals.

Proposed Compensation for Investors:

• 6% preferred return annually.
• After the preferred return is met, profits are split 75/25 (with investors receiving 75% of profits on their portion of ownership).
• Profit Calculation:
  • Revenue – Operating Expenses
  • Excludes mortgage principal & interest, as our LLC assumes full responsibility for the loan.

Looking for Feedback:

• Is this structure fair and attractive to investors while ensuring long-term alignment? Are we possibly cutting ourselves short here with a deal of this nature?
• Have others structured similar deals, and if so, what worked well (or didn’t)?
• Are there any potential flaws in the way we are setting this up?

Since this is our first time structuring an investment deal like this, we want to ensure it’s fair and appealing to both parties. Any insights or alternative structures would be greatly appreciated!

Thanks!

There are tons of furnished rentals across the country that will sell you the furnishings with the property.  Airbnb approved isn't a thing.  Either jurisdictions allow them or they don't and you have to find out what each jurisdiction allows.  You can literally search keywords on Zillow and put in furnished and short term friendly or furnished and Airbnb and see what pops up.

BH

Do not higher a guru to coach you on how to get an Airbnb going.  If you need someone to hand hold you as an entrepreneur all the time all you are going to do is end up just spending money you should not be spending and probably never make it.  You can watch countless hours of free YouTube videos to learn about any subject you are interested in when it comes to short term or mid term rentals.  Majority of the people selling guru services for anything are just grifters and the rest are borderline scum that made a name for themselves overcharging for what you can learn yourself by just doing a little research.  If you are looking for a true mentor you are much better off going to local meetups and making connections with individuals 1-1.  If you vibe with someone who is in the business and create a friendship that might be someone worth learning from.  Nothing is better than actual hands on experience and getting in the trenches yourself.

And FWIW, the guy you mentioned has an instagram page that says he lost it all 3 years ago and now manages 18 units.  While that's great for him I would not be even considering this person an expert in the slightest with such limited experience.  There is no revelation you are going to get from him that you won't be able to find for free.  If you are looking to arbitrage find the best short term rental arbitrage people that share videos for free, if you already have a property and are looking to run it yourself find the best people who share free videos on that.  Programs like hospitable and pricelabs can make things very easy for you once you have things in place and are willing to put in a little time to see how they work.

BH

We have experience purchasing properties through our LLC using lending, where we own 100% of the properties. However, we are now exploring opportunities to bring in passive investors to help accelerate our portfolio growth. Our primary goal is to retain as much equity in our properties as possible while leveraging outside capital to scale faster.

Proposed Investment Structure:

• Investors contribute 30% of the purchase price and 30% of furnishing/rehab costs.
• Our LLC secures a new purchase loan in its name only, taking on 100% of the debt.
• This structure allows us to maintain 70% ownership of the property.
• Properties will be actively managed to maximize returns, likely achieving higher upside than long-term rentals.

Proposed Compensation for Investors:

• 6% preferred return annually.
• After the preferred return is met, profits are split 75/25 (with investors receiving 75% of profits on their portion of ownership).
• Profit Calculation:
  • Revenue – Operating Expenses
  • Excludes mortgage principal & interest, as our LLC assumes full responsibility for the loan.

Looking for Feedback:

• Is this structure fair and attractive to investors while ensuring long-term alignment? Are we possibly cutting ourselves short here with a deal of this nature?
• Have others structured similar deals, and if so, what worked well (or didn’t)?
• Are there any potential flaws in the way we are setting this up?

Since this is our first time structuring an investment deal like this, we want to ensure it’s fair and appealing to both parties. Any insights or alternative structures would be greatly appreciated!

Thanks!

I recently picked up a property in a tax foreclosure in Cuyahoga County in Ohio.  There are good tenants in the building that pay monthly and they were paying to a property management company that was still collecting rents and signing new leases while the property was in foreclosure and had no contact with the owner because he either went MIA or decided to completely neglect the property and let it go.  It seems like the property manager was basically collecting and pocketing rents since there was nowhere for him to send the funds too.  I know in tax foreclosure situations the new owner can become liable for the security deposits.  In this specific situation should the property management be forwarding me the current owners security deposit and/or paying me a pro-rated amount for the current month collected if I acquired the property in the 1st week of the month and rent was already paid for the full month?  If I am not entitled to the money by law is there any harm in asking him for the security deposit and pro-rated amount of rent for the month that was being charged or having my tenants nicely ask for their deposit and/or pro-rated rent back for the month they had already paid in advance?

Thanks for your time

The yelp speaks for itself, multiple people don't call you a scam unless you are slinging garbage at the very least

https://www.yelp.com/biz/nick-vertucci-real-estate-academy-santa-ana

The yelp speaks for itself, multiple people don't call you a scam unless you are slinging garbage at the very least

https://www.yelp.com/biz/nick-vertucci-real-estate-academy-santa-ana