All Forum Posts by: Charles Soper

Instead of selling do yo have enough equity to pull an LOC on the portfolio to purchase another property? There is always danger in leveraging existing assets to acquire new but in California the likelihood of an appreciation drop and a loan call by a bank would seem fairly unlikely.

Have you tried looking at commercial listing sites like Loopnet and CREXi?  Might be a bit of a stretch financially but maybe a 5+ unit to "house hack" would be easier to find.  You might also reach out to a commercial broker, a lot of times they'll have pocket listings and the only way you'll ever know is by picking up the phone...maybe dial a few randomly that you find on Loopnet.

Those of us looking into multifamily opportunities tend to be very data driven, this might give you some insight on Florida.  https://multifamilyu.com/?s=corridor&et_pb_searchform_submit=et_search_proccess&et_pb_include_posts=yes&et_pb_include_pages=yes&field%5B107%5D=direct&field%5B108%5D=direct&field%5B109%5D=https%253A%2F%2Fmultifamilyu.com%2Fcorridor-of-opportunity%2F&field%5B110%5D=2

A little far south to grab a cup of coffee but happy to if you are ever down this way.

The numbers will always tell you if a deal is worth looking at, and if it is then you put boots on the ground and start digging into your due diligence.  The BP calculators are a great place to start and will guide you through each piece so you don't leave a critical number out of your calculations.

After you have analyzed enough deals and found one that you think looks good, you will need to be bold and pull the trigger, the first one is always the hardest!

@Sam Wocelka an education in how commercial multi-family works would serve you well.  There are a number of great coaching programs out there that are self-guided.  If you learn like I do, you would be better served in an seminar/classroom environment where you can learn in person and network with others.

I would suggest you look into investing a weekend or two into these events from guys like Joe Fairless, Rod Khleif, Michael Blank, or Brad Sumrock.  @Charles LeMaire, @Theo Hicks, and a few others could give you the first hand testimonials on these syndicators. They all have plenty of free information on their websites and all do teaching events as well as offer coaching.  The think I like about all of these guys is that they are actively doing what they teach, not just spewing theory trying to sell you high priced educational packages (although they do have some of those).

You can also go down the data driven path and hit up the big brokerages for they reports they put out.

To name a few:

IRR.COM, Annual viewpoint Commericial Trends Report

Marcus & Millichap’s Annual Multifamily Forecast

CBRE also does market specific reports that you can dive into as well.

May I suggest you start looking at meetups and local REIA groups as an option to sell your property? Those groups tend to have many types of investors and I suspect you'll find somebody who would be interested if the numbers make sense, or they may know somebody. I assume this is a commercial property since you are looking at Loopnet?

Where did you find a 15 yr term commercial mortgage?  Local community bank I assume?  That said, do they offer a 30 year term?  Keep your debt service low and cash flow high.

So at that purchase price and ZERO down (80 bank/20 seller) your after debt service income is something like 5k, which leaves very little room for error, one major roof issue or other capex event and you may be in trouble.  It also seems your expenses are low by about 20%, quick and dirty rule you should be using 50% of revenue as expenses until you can nail down the actuals for deeper analysis.  Need more info if you want further help.

@Jeff A Barnes definitely need to look at the actual numbers AND run your own to see what you think you could operate the property at. Where the revenue vs. NOI is seems really low, less than 20k vs. 50% would be roughly 35k.

That will make a big difference in your ultimate offer, remember it's what YOU can operate the property for, not what they seller is currently doing it at that matters after purchase.