All Forum Posts by: Brian Garrett

Hey everyone! For those of you who don't know me, I'm a commercial multifamily investor (direct principal buyer not a syndicator) based out of Palm Beach County, Florida. I'm looking to connect with likeminded investors and commercial brokers who are active within the state. My focus is on value-add apartment complexes. Primarily smaller deals in the 6-20 unit range when I'm buying myself but I have also looked at buying larger deals with a partner as well. Anyone on BP buying similar properties or doing multifamily deals in Florida? I would love to compare notes and discuss what you're seeing in the marketplace around your area! Please feel free to reach out!

You don't need any of these requirements for commercial/portfolio loans as long as the numbers work. 

In my opinion the only scenarios that would justify this would be a significant appreciation or value-add play where the equity gain on the exit will outweigh the interim cash on cash return during the hold.

Typically most budget 5-10% for repairs & maintenance and another 5-10% for CapEx.

I personally think the 15% you're already accounting for should be fine to cover both of these.

For a 12 unit multifamily building you're going to need to put down 20-30% as that's standard.

The only ways around this are to bring in private money partners or to find a seller financed deal.

Even with private money you'll need to put down 20-30% but it won't have to be your personal funds.

Be very clear with them on your criteria and what you're looking for.

If they still continue to send "bad deals" that don't fit then just move on.

Yes they’ve been back for a while now. They aren’t the same as before 2008 but there are bank statement loans and other products in the marketplace that don’t require tax returns, etc.

Personally, I would account for re-plumbing the property and the roof replacement in my rehab scope. Furthermore, I don't see expenses like property management, CapEx, lawn care or insurance in your costs. I also think your repairs and maintenance budget of only 2.5% is too low for a property this old. I would expect that to be in the 5-10% range especially if it hasn't been completely rehabbed.

If you've lived there 2 out of the past 5 years then you are tax exempt on the first $250k of equity gain if you're single or $500k if you're married. 

It doesn't have to be one or the other. You can buy value-add deals where you can force appreciation to capture the equity gain and still cash flow once it's stabilized. If you don't want to deal with rehab or repositioning a property then you can still look for markets that have strong cash flow and also have good appreciation so you still get the best of both worlds. Ultimately it depends on your goals but achieving both is definitely doable!