All Forum Posts by: Gregg Gannett

@Erin N. Congrats on the step up. Lots of good suggestions already. One thought is to look for the "gratis" industry magazines like "Coastal Living" or "Dream Homes" (San Diego) sitting out in front of broker offices or similar venues catering to this segment. The photos are nice and big and illustrate a broad range of price points, styles and finishes in the local market. With Amelia Island up from JAX there should be some version of it there.

A bit obvious but sometimes not fully exploited are SKYPE call walk throughs with missing team members or out of territory consultant for a quick take. I used this often between Mexico/US years ago before the tech became more comment place. Now with higher resolution and apps drilling down on details is easier to put into a work flow of virtual management. 

GG quick tip: video walk thru day one for personal record, review, reflection. It is amazing how easily it is forgotten that closet door swings left not right or soffit really does extend longer than thought. Then up load into a DropBox project folder for the team to view as needed.

Jon,

Small tid-bit within the discussion.

"Partial Lien Waiver" and "Material Lien Waiver" from each sub and GC for each payment during the construction process.  Using signed inspections, bench marks, scope of work completed can be a basic guide. For example, a concrete company will provide a release right after the pour if pre/paid with smaller subs. These individual waivers protect you along the way. If possible plan walk throughs with the GC and trade in process just before the agreed waiver due date if possible with an extra set of experienced eyes. Not late in day or evening-morning time. You will learn a lot asking and listening while demonstrating an active presence. Bring a "Box of Joe" and bagels.

"Final Lien Waiver" from each sub trade when the contracted scope of work along with all Change Orders and Punch List* is completed. This included the GC. Hopefully there has not not been a lot of drama, bring Lattes

*"Punch List" If there is a remaining Punch List of items adherent to the GC and not so much to a trade holding a % or amount of $ from the GC leaves leverage it will get done and allows time to see what else may have been reasonably missed. Then perform a final walk through 30 days after completion and close out the balance. Bring a bottle of Champagne and personal flask of Bourbon, conciliate as needed.  

Lastly, 

-Insurance: Review Proof of Insurance from GC and all trades and be additional insured on GC policy.

Good luck

G

Ahh shucks, thanks Jay

G

Scheduled maintenance = preventative maintenance = CapX schedule, where stand alone Reserves are one thing and being under capitalized is another. Thou shall not let the two meet unescorted lest it be death by the handyman's hammer. For those who have the space or the option squirreling away as previously suggested appliances, water heaters, ac units, bulk hardware, lighting, circulating pumps, cabinets and standardizing maintenance specs can be very effective to EOY reports. Home Warrantees put a man in the middle loosing a level of control of the schedule and decision making process. Lastly, as noted earlier, working with $100 a door across a number of stand alone dwellings is a very thin IRR until each is paid for or performing better. That risk needs to be front loaded as much as possible with due diligence, leverage, partnership, one's owns secret sauce like being a contractor etc. We all have been there and time will ripen the investment so hang tough. Look to the future for what "ifs" like fixing shower tile or going with surround or corian sheet where future cost can be controlled and no emergency thinking needed. The GG quick tip: Depending on class of rental look to mid level hotel bathroom renovation for trends and ideas based on value and maintenance. Then find the crews who do them b/c they can turn a bathroom in 2 days* for a set cost, know the suppliers or have leftovers for much less than retail. G

Great to have this segment now. I can offer 7 years VR experience, specifically Merida, Yucatan. Looking forward to seeing this added to the market place category as well. 

Yes, please add the VR option to the market place and glad to see this segment has finally spawned in the BP community. 

 @Account Closed: has the best question as to the first responsibility of the building owner. Most leases require min 24 hr notification unless its an emergency. 

there after BP Nation: 
-Please people when in doubt first call a lawyer, the police or proper authority especially when the rights of others are involved. "Conditions and Terms" in a contract or transactional deal is one thing threat of jail, custodies, and civil rights is something completely different. Then take the next step: engage the proper authority, ask tenant to explain, look the other way and have it come back 10 fold should the detectives want  to "ask you a few questions" upon his inevitable arrest. 
-Always attempt to enter a unit with a witness then proceed to work alone. Ask a neighboring unit to watch your knock and entry. It good business and risk management. 
-Never post speculative documentation as such on the internet until approved or absolutely needed. Even then why? This isn't the History Channel's "UFO Marathon" for the court of opinion or FaceBook. 
-Also, take a landlord class/webinar on this topic. Since legalized MJ this can be tricky waters for owners especially commercial property. Ask for the top 10 "If this, then what?" from your RE lawyer.  I'm pretty sure most of the answers will be "call the police or your insurance agent unless you are being served or serving" 

Now lets be safe out there. 

G

Hi Tom:

A quick chime in on other costs: seasonal pest control, landscaping, Marketing/Incentives, contingency % for the "Oops factor", termite bond, buy out or early cancelation fees on any service agreements. I personally like to scope the sewer lines on any purchase with a video camera to the street were liability ends since my x-ray vision is not what it used to be. 

Is potentially raising rent 15% the only add-value strategy, then price is a big factor. Noodle out plan B & C before hand if the seller ends up holding to his price, maybe holding some paper. "To give you the price you want, adjustment is needed with the terms...If you demand these terms the price needs to reflect it." Neither party rarely gets both to be mutually beneficial.  

Hi Justin,

Firstly, hang in there. Prudence investing additional capital is wise if not knowing your longer commitment level or having a detailed plan with the thin margins and limited options so described. Changing floor plans or taking on numerous capx upgrades to purge the conditions might be an excessive start until later: zoning, permits, and 2nd egresses come to mind unless a basement unit can be added. Not sure what your cost basis is with repairs  but -$60 seems manageable on paper especially if you had intended to bring cash to closing. What do you think could be accomplished if taking some of that $ to buy time or as covered earlier to reduce expenses while increasing revenue? It is apparent this will be a tiered approach and not resolved overnight. Therefore,

What is the Section 8 FMR for your county? Would converting get you 10-20% more per unit and more stability or is it already Sec 8?

Maybe put some feelers out as suggested earlier for a management for % equity partner with benchmarks while allocating some of that walk away $ for a last turn-around strategy then re-evaluate a sale. 

Can the debt service be lowered or if sensible*** a 3-5 yr % only with intent to re-list in 18-24 months while the details of phase 1 of the turn around play out?

Marketing to tenants who are in the trades that can help improve the building with your oversight for credit back at end of lease or renewal. 

Hope this helps.

Gregg