All Forum Posts by: Derek G.

Please advise if anyone has utilized an estimating company to review or put together a budget for a property being auctioned. The property is occupied and therefore does not allow for it to be viewed prior to the auction. 

Property is in South East Florida and am searching for someone with experience with auctioned properties. 

I've reached out to my personal contacts as it pertains to obtaining LPs and have soft commitments for various projects. Searching to add to my network of LPs for real estate investment properties for new construction (such as Duplex for sale) to small multifamily rentals (4-24 units). There are some opportunities for value add properties in South East Florida.  

Any platform recommendations to raise equity capital will be appreciated. We have contacted a few popular crowdfunding sites. 

Thank You, 

Derek Gutierrez

Taylor,

Thank you for taking the time to reply. Your response was informative. 

Best Regards, 

Derek

I'm in the process of finalizing talks with an investor to commence a real estate development project and would greatly appreciate assistance in clarifying a few things given certain scenarios:

Investor injects 100% of financing into a project. I’ll be the sponsor dealing with day to day operations. In this scenario is a 50/50 split of profits industry standard or is a preferred return such as 6% for the investor with a 50/50 split more common?

Investor or multiple investors (such as a syndication) injects 25-30% capital into a project, developer/sponsor provides 5% and the rest is financed by the developer. In this scenario is it common to provide the investor 20-25% of profits or a preferred return plus 20-25% of profits? It would be split amongst the number of investors and how much each contributed.

Is there any software that you have found to assist with distributions especially with multiple investors? Also is the preferred return typically paid monthly or at the end as a lump sum?

When purchasing the land itself and investor funds are used to purchase, is interest typically carried over or deferred? It can take at times a year to entitle a property plus construction if developed and wasn’t sure typically at what point they start getting paid especially if it is a partnership.

Your time will be greatly appreciated in clarifying these items for me based on your experience.

Best Regards,

Derek

Also, it would be multiple investors, not just one person. 

Taylor, in that case would it make more sense with a promissory note in lieu of a real estate investment agreement? 

Please advise what type of agreement typically is signed when a passive investor is injecting capital for a real estate project: Real Estate Capital Agreement, Real Estate Investment Contract, etc. In this scenario capital would be invested to meet up to 25% of the project cost while I will take out the main project loan under the corporation. If there is a template that can be referred please advise to review. 

Also, as it pertains to rate on investment distribution is it typical for a flat rate, flat rate plus lower profit sharing rate or no flat rate with a higher profit sharing ratio. 

Best Regards, 

Derek 

Matt, thank you for the reply as this is informative. 

Enrique, Thank you for taking the time to reply. Your responses are informative. 

Bryan, Thank You for taking the time to reply.