All Forum Posts by: AJ Shepard

@Mike Zhou

This seems like a good example of making sure you know your sponsor and how they operate. Typically on a refinance the sponsor will return your capital and reduce the preferred return, interest payment on that capital going forward. Typically your equity (ownership percentage) in the deal should stay the same until sale of the property.

It is fairly common to return capital upon a refinance. The original debt is being restructured and you are effectively reducing the amount of capital that you have in the deal by replacing it with typically structured bank or other debt. Refinances are hard to model in a pro forma as well as hard to determine exactly when they happen. But they are a great tool in some cases. Next time, just be clear on how your sponsor will handle a future refinance.

@Justin G.

Congrats Justin! Nice work.

@Matt Aquino

We did something similar in our Property Management company. It’s typically called a mastermind. Getting some experts together in the field and talking specifically about certain topics and what has worked and what does not. @Chris Shepard has been interested in starting a mastermind for syndication as well. We’d be happy to participate with you guys. I’m happy to share some of our info on our other mastermind meetings as well.

Typically we poll the group to find out a subject that a company is struggling with and then have the group share what it is that they do in that area. Allows for people to draw conclusions on how they may get whatever challenge they are having done better as well as for everyone else, they may glean in on a way to improve their process or service. We openly share documents, internal processes and anything to help the group out.

@Steven Huynh

I’m always of the advent that the more you own the better. Just out of curiosity, why don’t you have buying a 4 plex or small multifamily on there and hiring a property manager 100% yourself? In some cases, I would think it still be an option to consider.

In my opinion, I would try to stick with the project based. This is also coming from someone who is already very knowledgeable in performing projects. It requires you to keep moving your money from one to the next as they perform, but I think you will find that they typically are underwritten fairly conservatively and also may end sooner than anticipated with higher returns than advertised.

A fund, and in general, as investment size gets larger gets much harder to match large returns of a good project. Say the fund has 15 projects and 2 of them are home runs. They are going to have 2 dogs in there that average the returns down. Additionally there may be some down time of when the money isn’t working. Yes, this is generally very stable and predictable, which is what some people may want. Might be preferred as well with someone that has little to no experience in knowing what a good project may look like too.

I agree with @Justin Hoggatt, if you partner with a syndicator as LP you don't need to worry about these things as the GP partner will do all the work for you. This is one of the benefits of a LP partnership with a Syndicator, you get to rely on all of their experience and knowledge. You just need to find a good syndication operator to work with.

Here's a few good books on my list:

Best Ever Apartment syndication book by Joe Fairless / Theo Hicks

The Hands-off Investor by Brian Burke

How to Create Passive Income, Build wealth, and Take control of your destiny through Multifamily REI by Jake & Gino

There's also a lot of podcasts out there about Syndication that can help you with those unfamiliar terms.

@Michael S. 

@Elliot Callaway

Welcome to Bigger Pockets. Keep connecting with people and asking questions. This is a great network within the real estate community and you can find almost anything real estate on here. There are definitely job postings here, so check those out as well. If you can attend meetups, those are great places to meet new people and network.

I will say that a lot of the mindset on this site is that you will need to figure out what you want to do and learn from others. The big thing to think about, is what value can you bring to someone else or a company? Don’t discount the knowledge that you will gain working with someone else. At this point in your career, you probably have a lot of time, not a lot of money and not a lot of knowledge. There are other people in their point in life that have a lot of knowledge, a lot of money but not a lot of time. Coming up to someone and saying put me to work is not helpful. Figuring out how you can help someone else who is in a position that you want to be in will go a long way.

Welcome to the BP Community! You are on the right track! My advice is that you should listen to podcasts. There is a lot of content that you can find about investing. You should leverage other people's knowledge and learn from them. Best of luck to you!

@Lara Nicole

I'm curious why you think a SFH in portland is better than Multifamily? If you've been looking in Portland at SFH lately, prices are incredibly high with inventory at or below 1 month.

Multifamily is trading at about 175-250k per door on the 1-4 units. If you can make the jump to 10+ units you'll find units trading at 150-200 per door. Where as SFH is much higher.

My suggestion like some of the others would be house hack a 4 plex. And this is for a couple reasons.

Currently interest rates are low, this increases your buying power. You can afford more when your payment consists of less interest. Appreciation in the NW is great, so when you make 3% off of a 800k purchase each year that’s a good return (using leverage)

When purchasing a 4 plex, you get to use the other 3 rental units as income for financing. This will help you out for qualifying. I don’t know that bank statement loans are as common these days.

Moving into something like this will most likely reduce your rent to 0$ or be a positive cash flow. You will be able to save money quicker when not spending it.

You will get the experience of being a landlord and owning property. Not having this experience and trying to do it 1000 miles away sounds difficult (Even for me).

The laws in Portland are much different for a landlord that lives in the unit. You pretty much have Cart blanch on how you want run it. You don’t have to abide by fair housing, you can kick people out easier. They call this the grandmother clause. But is only if you live in the building and it’s 4 or less units.

Hope this helps.