All Forum Posts by: Account Closed

Been looking into doing some passive investing as an LP. (Meet all the qualifications and have some familiarity with PPMs.)

My question to anyone who has successfully invested (and returned capital) as a limited partner: Do you have someone look over the PPM on deals you plan on investing in?

I've heard it really comes down to trusting the operator and opportunity, and then just keeping an eye out in the PPM for anything abnormal.

Thoughts? Help? Anything is appreciated!

@Jingwen Dunford

Really depends on climate. But here in the SE we usually start clean up in the early spring. Mowing runs March through November. Bushes are done May to early July and again October to early December, skipping the major hot and cold. Leaf season is usually October into January.

@Anthony Wick

I've had similar situations. Get out there and after touring the property I get a "are pitbulls allowed? ....we have 3"

So we try to pre-screen as much as possible and hope people like this don't call or apply.

@Jenna Columbus

$45 is totally reasonable. They're applying for short-term, exclusive access to something that easily cost you 1000x that small fee.

Yes. Recessions are a part of any expansion cycle, like low tides. My problem is with the unintended consequences that arise from governments trying to control the tides.

@Jarrod Clavelle HOA fees are fine as long as you're getting your money's worth. You want the property to be properly maintained. The key is making sure fees and what you're getting for them are reasonable, and to be mindful of any assessments that will arise in the future.

@Steve Vaughan Totally agree with you. This was all from when I was a PM years ago. Happy to see the industry from the inside, managers do an often hard job and I believe they get paid accordingly (as I hope you pay yourself!)

Alignment is a tough cookie. You want to be able to rely on the PMs reputation being on the line, but isn't always enough. Money is a good driver, but hard to posture without leaving some loophole or perverse incentive. I liked the lease renewal fee, because at the very least we were both aligned in trying to get more time from the same tenant...which hopefully means the PM would be more rigorous when picking a resident.

@Anthony Rosa PMs will bend most rules if you're significantly adding to their management portfolio.

We always kept late fees -- justified as payment for the extra work to collect. But we had a strong screening process and some pretty lofty hurdles, so late rent was less common. It doesn't make for much alignment between PM and owner.

For lease renewals we actually charged a 50% fee. Which at first seems exorbitant, but it's probably the most aligned fee in the game. You get more time/money for your last turnover cost, and no vacancy. They get paid sooner, and have (more of) a reason to keep your tenant happy and actively pursue a renewal.

Hold her to it or get a lump sum buy out. I err on the side of holding her to it. She signed the contract and your numbers were based on her being there. A lump sum does give you a buffer at the very least, but I worry about the other 2 and any financial strain it would cause on them until another qualified roommate is found.

Basically, everyone's calculations were based on her being there another 11 months.