All Forum Posts by: Gwyeth Smith

@Kenny Kamdoum.  In addition to the resources @Matthew Baltzell suggested you can also search Colliers International  and even do a google search for <your market of interest, commercial real estate> and find some smaller commercial brokerages that might have properties listed.  If your goal here is to get familiar with the underwriting process then you should get the same value from underwriting a good deal versus a bad deal.  I wold take advantage of the plethora of OM's available on LoopNet and start running them through your model.  You never know, a good deal might even fall through the cracks there!

I've become friendly with an investor who has many properties in Brighton Heights.  He loves it.  He keeps telling me that he gets Shadyside rents in Brighton Heights for a fraction of the cost.  I can't personally vouch for the validity of that, but I know he loves Brighton Heights and Greensburg.  

@Richard Jr Caicedo.  Please do keep us posted.  Best of luck on this!

@Richard Jr Caicedo, first thing I would do is to figure out your goal with this project (i.e. 12% cash on cash return by year two (just an example)).  Echoing what @Chase McArthur said, you will probably want to run some projections.  What will your total project cost be to get all units rentable?  Figure out that timeline and then what you can expect for revenues and expenses.  At that point go back and start plugging in different purchase prices into your model and find the one that meets your goal.  Use that number help come up with an offer price.  

@William J Stratton Jr.  Berkadia's 2019 Forecast is a good resource that gives a snapshot of a bunch of different markets.

https://www.berkadia.com/wp-content/uploads/2018/1...

Also, you might find this podcast episode helpful.

https://www.realcrowd.com/blog/2018/07/podcast-mul...

@Tony Castronovo.  Coinmach will provide you with machines and then maintain/service them for a percentage of the revenue (it might be negotiable but looks to be 50/50).  Full disclosure, I do not use them yet so I cannot recommend them first hand.  They have been recommended to me and I just started looking into them myself.  

@Justin Michael Johnson, at the >$1M price point the deal would qualify for agency debt (Fannie/Freddie).  The advantages to that are you can typically get a 30 year amortization and you're probably looking at the best interest rates.  The disadvantages are the requirements and overall process of getting those products.  As @Chase Louderback mentioned, there are liquidity requirements of the borrower.  They will also look at your real estate resume, they will vet your property manager, require one year prepaid insurance, and ask for every possible document from the sellers!  

On the Flipside, you could finance with bank debt.  You are probably looking at a 20 year amortization and a slightly higher rate.  The benefit is that the origination process is much easier.  

If you can cash flow with a 20 year amortization there are some decent options for you.  I like the strategy of getting the property with bank debt, implementing your plan to increase the value, and then refinancing into agency debt.

@Chirag Shah I went to Mark and Tamiel Kenney's R.A.I.N. conference just outside Dallas last year and it was great.  I think they have another coming up.  Look up Think Multifamily for more information.  I am also going to the Best Ever Conference in a few weeks and am looking forward to it.  I started off similar to you; bought a duplex in 2016, a 4-plex in 2017, and closed a 13 unit in September.  The conferences are a great way to connect with like-minded people. 

@Brian Lynch I second the notion of a weekly date night.  My wife and I incorporated that this year.  We start off by going to dinner and reviewing our goals and things regarding the business.  It then morphs into a non-business date and we end up playing trivia at a local spot.  It's done wonders for both us as a couple and as business partners.  I had been trying to get her on board for quite some time.  It took a conversation we were both having with another investor to really covert her.  Sometimes our spouses, children, etc., need to hear hear it from another source for it to truly absorb!

@Account Closed. Here are a few things I usually adjust for when underwriting off an OM, whether it be from LoopNet or not

• Closing Costs
  • I can't tell you how many times I see CoC calculated on an OM using just 25% of the purchase price without regard for closing costs, prepaid insurance, prepaid taxes, or anything that might be required to close
• Vacancy %
  • I bring this to the market average or if it’s a small to mid-sized building, I’ll look up and see how many units are being marketed online for rent.
• Property Management
  • I will bring this to what the company I will use charges

Stuff like that usually changes the numbers a bit. At the risk of being chastised, sometimes a deal that looks too good to be true actually IS a good deal. Loopnet has its reputation, and deservedly so. With that said, I know of two people who have found good deals there recently (unfortunately not me!). With the perception being what it is, some good deals may get overlooked and be waiting there for you to find!! Best of luck to you.