All Forum Posts by: William Yeh

I used REE to get my license in CA and found it adequate. As @Brett Synicky suggested, make sure you run through a bunch of practice exams (at least 1000-1500 questions) prior to taking the test. Can't remember which package I chose but REE had this feature built in.

Getting your license is not hard (I'm sure we all know some less than competent agents). The real work in being an agent is finding leads. The paperwork anyone can learn.

Yes there is some true that Loopnet is where bad deals go to die but then again there are a few gems that filter their way through the listing broker's buyer list and onto the open market.

Aside from Loopnet, I would talk to a commercial agent that has access to Costar. While most listings will be the same, some will only appear on Costar and not on Loopnet or vice versa so you want alerts setup for both.

Anther thought is if you find a deal and it fits all of your requirements, does it really matter where it came from?

It all goes back to what your priorities are. SFR's have greater potential for appreciation beyond the cash flow they generate simply due to end consumers that don't care about cash flow and want a nice place to live. I qualify that statement with the fact that it depends on what class of SFR you're looking at. Likewise, your appreciation and liquidity of a MF will depend on trends in market rents and investor demand which affect the cap rate the property will trade at.

Some say MF is easier to manage but you are entirely dependent on the property manager who can make or break your investment. On the flip side my group has 12 single family homes with a solid property management company and it is hassle free.

There are two sides to every coin in this debate and no right answer. It just depends on what your priorities are.

@J. Martin Awesome to hear your story and thanks for sharing and for giving so much to the BP community. I've certainly enjoyed all of the meetups and all of the great knowledge that's shared so freely and hope to give back just the same.

Hey BP,

My group has a 43-unit multifamily property under contract now in Carmichael, CA, a suburb of Sacramento, and I'm wondering what any of you out there with a similar sized unit has done in terms of management of such an asset. What percent of gross rents does your management cost you?

I'm looking at approx 10% in this scenario which of course could be overstated for tax purposes so I need a true cost benchmark to compare it against.

Subject property is a 1970's build in a solid blue collar neighborhood with <5% vacancy and it looks like it's well taken care of.

Thanks for your thoughts.

@Amit M. Were looking at taking this deal down ourselves as I'm a partner in a real estate LLC and an agent.

What kind of ballpark numbers are you seeing for this type of work in sf? Subject property is fairly open concept but of course plumbing, electrical, utilities, demising walls and windows will need to be installed and upgraded.

@Amit M. city is Oakland

I'd recommend getting your lender involved as early as possible. They'll have a completely different perspective on the property. Granted their DD list isn't the end all, if it's too risky for them or your LTV is really low, that should be a warning sign.

I'd go off of their last few years' Schedule A on their returns to get a better sense of the true financials. Of course you need to add depreciation and any commingled items back it but it's probably the truest picture of the financials that you'll be able to get.

Talk to the tenants too when you tour the property. They'll give you a real sense of what the neighbors are like. 

Hey BP,

I'm a realtor and real estate investor based out of the Bay Area, California and I'm looking at a potential commercial to residential conversion play. The subject property has 5 stories including a basement and mezzanine level. Residential is an option for anything above the ground floor. The building has a fairly open floor plan but it is an older building (1920s build).

Does anyone out there have any experience in doing such conversions in the Bay Area? If so what would be a conservative hard/soft cost assumption per sq ft?

I'm trying to put together a pro forma and have a good handle on the marketability of the finished product but the only development experience my group has is residential remodeling and light industrial buildouts.

Many thanks in advance.

Referrals are everything. A loopnet premium membership is a solid place to start finding listings. It won't give you everything that's on Costar but it's certainly better than the free site.

Once you find listings, I'd also advise you to consider letting the listing broker double end the deal. I've come across my fair share of commercial agents that will not sell a listing unless they double end it. Unethical? Yes probably. But in an impacted market where good supply is thin, it's a necessary consideration.

Hope that helps!