All Forum Posts by: Dan Handford

Typically it depends on the complexity of the syndication structure but I've seen anywhere from $9,500 to $25,000. Now this does not include the costs to file the Bluesky Filings in each state so keep that in mind as well. 

@Emad Fawzy - We make it easy for you to invest in the USA while living overseas. Be sure to reach out or stop by our booth so we can discuss the process with you. Glad to help!

Thanks @Mindy Jensen for the shout out. 

Everyone here at PassiveInvesting.com is looking forward to connecting with the attendees at the BPCON2021 in NOLA! We are bringing a large majority of our team and can't wait to network. 

If you are an accredited investor, please stop by our booth and introduce yourself to our team.

In the meantime, be sure to on "Red Flags for Passive Investing in Real Estate"

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As long as you are well-capitalized and you can weather a storm, then you will be fine. This is a short-term blip, albeit a major blip, but in the long term multifamily assets will still outperform other asset classes due to demand.

Glad to see you still actively seeking deals. 

Have you connected with Whitney Ward in Atlanta, GA yet? She is a great small multifamily broker and you should certainly connect.

Any deal you are analyzing right now should be balanced with realistic assumptions. You have to assume that rent growth over the next 6-12 months will be flat. You also have to assume longer renovation timeframes up to 24-36 months depending on the market. You also have to underwrite for a wide array of debt flexibility. 

If the deals still makes sense, then go for it. 

Also, don't let the idea of "less capital available" keep you from acquisitions. There is still capital being deployed and everyone is not sitting on the side lines. If you have a solid deal, in a solid market, with solid fundamentals, and with a solid operator then the capital come in in the midst of covid-19.

Your #1 reason would fall under #3 above in my original post. The people who are uncertain right now are simply waiting and sitting on their capital to realize higher returns in the future as assets begin to be sold at a discount. 

I think the % discount you are expecting will certainly be had in many smaller markets. 

I still believe the discounted pricing will be short-lived and the economy will rebound quickly.

For those of you trying to raise capital right now in the middle of the coronavirus pandemic, you will likely face challenges from your investors that are normally faithful in investing with your group. 

Here are four reasons why some investors are sitting out right now: 

1. Lost Money in Stock Market

This investor has lost money in the stock market recently and either doesn't have the cash to invest right now or they are not pulling out in hopes that they will get their money back when the market recovers. 

2. Putting Money Into The Stock Market

This investor is looking to invest their capital into the stock market while it is at a low point in hopes of riding it up over the next couple of years to rake in some solid returns.

3. Sitting on Cash to Get Discounted Deals in 6-12 months

This investor is sitting on their cash in hopes of getting amazingly discounted deals over the next 6-12 months when properties begin defaulting.

4. Lost Income and Need Cash Reserves

This investor has either lost their job, been furloughed, or income has been impacted. Our group has many professionals, such as physicians and dentists, that have had their income completely halted since they are unable to perform any procedures. They don't know when they will be able to return to work and in turn need to preserve their capital in case they need it for personal expenses. 

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All 4 points above are valid but #3 I think is going to disappoint many investors. The difference between the 2008 financial crisis and now is that back in 2008 there was not a lot of capital in the market. Today, on the other hand, there is a ton of capital in the market. Many people are sitting on the sidelines waiting for those potential "amazing deals" and I don't think we are doing to see too many this time around. 

There is such much capital in the market right now that will be going after these deals that the prices will still get bid up to a point where the deal doesn't have that much of a discount. Sure, you are still going to see some discounts but nothing like 20-30-40% like we saw in 2008. 

I predict that prices will see a 5-7% discount overall over the next 6-12 months but it will quickly rebound to where it was pre-covid. 

What about you? 

Are you investing right now?

Or are you in one of these categories above?

@Yonah Weiss - thanks for inviting me to share with your audience during the virtual meetup. 

Looking forward to it. :-)