All Forum Posts by: Dexter Crawford

Here's some FAQ's:

What is your cost of customer acquisition?

On average about $1500/year per property

What are your target markets?

For now, I'm targeting the west suburbs (of Chicago) with convenient commute to downtown area - Oak Park, Forest Park, Westchester, Hillside, Elmhurst. With adequate funding, I will acquire in Chicago areas - East Pilsen, University Village, and Little Italy.

Are these single family homes? Is there any regulation that classifies you as a de facto hotel and therefore imposing lodging regulations?

Yes, my focus is single family homes. Purchasing in the western suburbs, there aren't any regulations. In Chicago, I'm required to acquire a license number through the Chamber of Commerce. It's a standard business license application process, which doesn't pose as a threat or challenge to the business. When advertising, you're required to listed your License Number.

What is the average stay?

For 2015, my average stay was 5 nights; with the lowest is 3 and the highest being 62 nights.

Is it hurting you that your average rate is $100 more a night then a regular room, size aside. A good percent of business travel is focused on whole dollars not size if they are traveling for business?

The overall price difference doesn't hurt for a few reasons:

1) We cater to more than just a business/corporate clients.

2) Our properties sleep 6 - 15 people (depending on the property layout). To accommodate a group of 6 - 15 people, it would take at least 3 - 5 rooms.  

3) Our price is about half the cost of 3 rooms. Last year, with 1 property, I booked 267 nights and grossed a little over $51,000.  50% of that was profit.

I brought a 2nd property online Feb 1, 2016.  As of today about 9 weeks into the year, I've done $24k in sales and our occupancy rate has been about 68%.

How much higher is your NOI than if you just leased these units on 12 months leases?

My NOI is approximately 4 - 5 times greater.

2015's numbers Short Term Leasing Biz Model:

4200 - Monthly Gross Sales

2200 x 12 = 26,400 Annual NOI

Standard Business Model

1550 - Market Rent

(1100) - Monthly Expenditures

450 x 12 = 5,400 Annual NOI

Do you have any existing deals that prove this out?

Yes, the document attached includes actual sales report from 2015 and 2016 YTD.

Low-Risk Investment opportunity; ideal for investors with an interest in the hospitality/hotel market.

Pitch -Live Plan Pitch

Supporting Doc - See picture below

Properties:

Property#1 -www.homeaway.com/3733046

Property#2 -www.homeaway.com/4135727

I am the Chief Financial Officer of the company, targeting a raise of $350,000 - $1.0M. Raised capital will be used to achieve outlined Milestones (see picture below). In an effort to grow the size of our portfolio, without severe degradation of our cash flow and liquidity, we are leveraging the properties’ current value. In exchange, we are offering a 10% annual return on investments; funds will be distributed in equal monthly payments.

Investor's Return

Example:

On a $1.0 M investment. Investor would make $100,000 within a 12-month period. 12 x $8,333 monthly payouts will start after 30 days of initial investment. Principal investment amount will be backed by the value of the real estate. Investor will earn monthly payout for a minimum of 2 years and a maximum of 5 years.

Contact Info

Dexter Crawford

Phone 312-933-0380

Email [email protected]

Go for it. I'd say check www.homeaway.com first and see home many homes are in the vicinity and the rates they charge and look at their calendar for the year to see hiw often they are booked (if rather difficult to get an accurate projection as its only mid February. But you can get a general idea. 

We have similar taste @Neal CollinsHere's my latest home 

Excellent read. Very well said. To be a part of this business, it really must be treated as such. It's a business that, if done right, requires lots of "cash on hand". I just bought a 2 Bed 1 bathhome in the west suburbs of Chicago; total out-of-pocket expenses with rehab and furnishings, $55,000.

@Adam Farag, one property I've owned for 4.5 years. The 2nd property is a recent acquisition. Just closed in December 14, 2015. Rehab is about  a week from completion. Should be listed by Feb 1st.

Length of stays vary.  Minimum 3 nights. I've had guests that have stayed as long as 3 months. 

There's a credit union called Navy Federal, the will do invest properties and general business loans. Locally there's one call Credit Union 1, I believe they will give you 70% Loan to Value. I believe there is a max of 5 properties though. I'll look into this again.

@Maura Paler, that is an excellent idea.  I've explored that option before a while back before I actually got into this business.  I'm not sure why that idea escaped me (duh!).  This is one of the reason I love Bigger Pockets.

Great input. Thank you. Let's stay connected. We may be able to bounce ideas off one another.

Just to provide clarity, I have a hard money lender for acquisition (quick close) and rehab.  My need is for the back end (refinance) loan.