All Forum Posts by: Bivi V.

1. Do not do it!

No experience. Looking for Management Companies for just 60 units. Likely not with a good franchise flag etc. is a disaster. Truly.

2.  BUT if you must do it,

then,

just get one of the families of your trustworthy friends, or, relatives and have them move out there, after receiving some intensive training in hospitality, to manage the small 60 units for you and take a risk!

Try to have them invest part of the down payment, to take some ownership interest and be responsible in avoiding any potential dangers.

3, If you do want hotel business, then, try to get some with above 100 units, with an above mid-level franchise flag - like Hampton, Holiday Inn, Best Western or other similar ones.

Better luck and better prospect with Marriott and Hilton brands, to get some good management companies - ultimately costing you 20% or more of the gross - when you add their extra-expenses of over staffing and unwanted maintenance and repairs bills, and, using their unused-resources to bill "your property" for services etc. Still, they can make some profit for you, teach you, and, you will find it easier to obtain finances.

Good Luck.

I would like to just stay with real-estate and not the actual hospitality-business.

@Diana Ag

Suggest contacting Vice Presidents of Development or higher executives, of any major higher end hotel Franchise companies - at their HQ. 

They will be more than happy to talk to you. You need not have any broker to work with. 

They need to be convinced about the availability of the funds, and, more importantly, about your own ability to manage and run the operation of the top franchised hotel. 

It is easier to work with their marketing and operation standards.

You should also be talking to large hotel management companies; which will facilitate your ownership of larger properties, with their proven expertise offered to you, to enable the better hotel franchise companies to give you the higher-end franchise. No fun in being mid-market properties if you have the funds.

Working with proven larger Hotel Management Company will also facilitate the financing for new acquisition or for new construction financing.

Just google for HQ for the top Hospitality Franchisors and for top Hotel Management Companies!

Best of Luck !

@Charlie MacPherson

Any suggestion ?

@Zackarias Aitchison

Excellent saving for future - separate utilities for each of them ! 

Eliminates landlord bills. 

Just curious, how much will it cost you to do so? 

How many separate meters ?

@Avtandil G.

It is MARKETING by broker while he tried to get the listing, just helped the seller to eliminate some numbers as NOT relevant to new owner etc etc to show that he can MARKET it at higher price!

We can ask for all information, in writing and will get some; but will miss out on others. They want you to decide from what they gave you and what you may find out of your own!

Well, each one of us have to develop our own BUYING due diligence and evaluation. Rent estimates, occupancy estimate, ALL the expenses estimate, Building condition, neighborhood, past history and future mix, almost EVERYTHING is BUYER beware! 

Even then, we buy and make more money than the seller - depending upon our skill set developed.

@Darius Howell

Just what do you really want to do ?

If you have down payment and you can manage to get the mortgage for the rest of the amount, then just have a lunch or dinner with Seller and his wife. 

Show sincere interest. 

Get his permission to get the property inspected at your cost, yes, before even a contract. 

Then try another meeting to discuss the value in your mind 

and 

do not insult him for his higher expectation -

but just that this is the amount that works for you, per your own independent inspection.

Listen to his talk of higher price - and again,  seek his HELP in arriving at price that works for YOU!

Done Deal !

@Faysal Alam

First one is always difficult. 

It is good to start with one, rather than none. Getting started is important but do not loose your money. Small deposit that is to be refunded. Do NOT sign any contract ready and prepared by any Real Estate Broker, it has some terms that rushes you too fast and prevents time for negotiating proper P & L terms and conditions. Do not make anyone as your Buyer's Broker. 

Only Biuyer's Attorney has the duty to protect the interest of the  Buyer, and is accountable!

It seems you have tried to learn everything. 

Just make the contract ! 

Hire good attorney who does ONLY real estate. 

Put ALL the contingencies to get out of the contract, at many different stages, and, at time periods.

Keep 45 to 60 days just for inspection and then to get proper estimate from contractors to fix with time frames. 

Then try additional 60 days to get financing and to Close on the property. NOT LESS TIME THAN THIS.

Total time, anywhere from 120 to 150 days for Due Diligence, Inspection, Appraisal, Mortgage etc.

Good, complete inspection, in your presence, by a most detailed building inspector is worth your money. 

Be present, ask questions, learn the problems. 

Do not let seller influence the inspection. Same for Appraiser, be present and try to learn. 

Be prepared to back out, do not fall in love with the location or the property, - if the building inspection report shows more items to be fixed

 - roof, basement, structure, old electrical wiring, plumbing. 

Overlook cosmetic items as they may be too many, but they would distract you from main more important problem items. But do consider them while RE-Negotiating the Price, as per additional Repairs Costs discovered by your various inspections.

Purpose of good attorney and good Building Inspector is to use the inspection reports to RE Negotiate Prices and Get adjustments - if you need it - for the repairs costs or get the repairs done by the seller before the bank mortgage commitment. 

Why ruin your credit score with hard inquiry IF property is not acceptable in the present condition for the value. Bank can order appraisal if you pay the fees BUT you can ask them to hold the process till you confirm, sometime even after appraisal too!

Well, not many would like such long response. 

Visit the neighborhood, get copies of any problems sited, from local town Health Dept for habitable condition of the apartments and Building Dept and Police Dept etc. too.

The list is long when you are buying first time, then it becomes habit to be aware and you would just to it for next property.

Good Luck ! Due Diligence for Dollars Delivered !

I have for my family, four separate mortgages on one name, each is 30 Year fixed-rate mortgage, from local bank. 

It is possible with Residential Investment mortgage, with 25% down, from almost any bank - if you put it on your personal name and with acceptable credit score. For this only your personal Debt Ratio, Income and own cash for down payment along with proper acceptable value of the propoerty is appraised by bank for property in ready to rent habitable condition.

P S: Just a note, for Non-Recourse loans, 

try to be ready to show at least 10% Liquidity of the requested  loan-amount, 

even though you may have Net Worth equal to the requested loan amounts.

@Derek Morrison

You had very exploratory open question soliciting pertinent information. 

You did get sufficient pointers from all of those who have experience in lending and in investing; helpful persons like @Amy Heitner, @Steve Hall and @Dushyant Ravi - all gave the available info with them.

It is always up to us now to consider our own project and explore the option available to us, go with the entity that has the staff person who is approachable, or find any good reputable Mortgage Broker, (who could cost a little more), who can certainly guide you to a lender with whom he or she works the most. They can help in documentation needed to expedite your process.

Hope you do have a project to get started with, to make your next million!