All Forum Posts by: Christopher Munn

You can buy without an entity. Or get an entity made on Nolo or LegalZoom in days. Go for it!

The current NOI wouldn't even service the debt at 650k. So if you weren't a cash buyer here, I don't even see how a bank would lend on this deal. Broker confirmed that it was 1031'd which I expected. The building needs upgrades to reach 60k in NOI. Cosmetic to the interior. It's a C class through and through though. No way to get it to B.

The seller could probably put 50k in Reno into it. (All in for 700k) Get NOI to 65k at best. And hope to flip it for about an 8 cap.

Exit for 800k and maybe cash flow it for a few years. 

I don't think it's the worst deal in the world. Just really skinny to do all the leg work all in an effort to avoid paying the taxes.

Just my two cents. 

(Which are only worth just that haha)

I agree. When a large Delta between current NOI and potential NOI, you will pay *something* for that potential. Especially if that potential turns into a lot of $. But if the upside is an extra 30k in NOI, I'm not willing to pay for 80% of that, leaving myself with only 20% for me to profit on. But the market is changing and if that's the price to pay, I will have to wait it out or work harder to find off-market deals.

@Dennis Johnson I see some folks on this thread telling you that it's too late to find investors. One thing I've found is never let someone tell you what you can't do. That's nothing against them, but they don't know who you are or what you're capable of. Use your network to find people who may be interested. 

I raised money after I had a deal. So it can be done.

Articulate what you're selling very well to people you know and trust. And sometimes the word spreads.

I am a testament to that.

@Tamar Mar congratulations on the deal

Aaron,

With the market being so hot right now I think I will be following your method. Everything that comes through a broker is providing like 3% CoC returns and that simply doesn't work for me.

Would love to connect and update each other on strategies of how its going.

I recently found a deal in the midwest (area where C class apartments trade between 7.5% and 11% cap rate).

16 units doing about 28k in NOI. (Not very good)

I own a 8 unit in the area that does about 30k NOI so this place has the potential to do around 60k with good management and a bit of reno.

The place sold to a cash buyer for 650k.

How are us "investors" supposed to compete with that??

I will stick to my standards but it becomes very frustrating when you aren't even close to being able to get a deal.

But we slog along...

Thanks Abel. I found it through a broker. It intrigued me because it was a great way to grow my unit count without having to do a $2M raise or something similar. But yeah...pretty much moved on after the call with the broker. Just a high price to pay for something that may be worth $3.2M when all said and done.

 The broker said the owner RECEIVED an offer for that price. So clearly he would like more than that price. I'm having difficulty understanding the offer. I know owners can ask anything they want.

That's really astonishing. I really want to get a nice value add play where I can stabilize a property but at that price, I'd have to completely turn the property around just for a 15% IRR. A turnaround project should yield turnaround profits imo.

Thanks for the input.