All Forum Posts by: Dave Hutson

Hey, I use Arbor Credit Union Commercial for all my needs. I'd suggest reaching out to them. They've been able to accommodate all of my unique requests from a lending perspective; several of the team members are able to think outside the box.  DM me if you want my contact's info.

@Charyl J. my team and I use Arbor Credit Union - we have partnered with their commercial side for all our small multi family deals in kazoo and GR.  Dana O’Laughlin - feel free to send me a note and I can provide you her contact info. 

Welcome - My team and I invest in Grand Rapids and Kalamazoo; primarily on small multi-families.  

I echo @Connor Anderson's input about the SW Michigan area.  Kalamazoo/Portage will start flourishing more now that Pfizer has developed the COVID vaccine.  The best time to invest was yesterday, the 2nd best time is today.  If the Kazoo/GR markets are of interest to you, please feel free to connect directly with me.  Cheers to your success!

@Jerry Rodgers

Hey Jerry what ever became of this deal - did it become an AFLC?

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Grand Rapids.

Purchase price: $251,000

Contributors:
Matthew Tanis

The Crown Jewel of our portfolio.
Triplex near GVSU

What made you interested in investing in this type of deal?

Triplex. Location. Upgrade in tenants/clientel.

How did you find this deal and how did you negotiate it?

MLS. Negotiated through our realtor.

How did you finance this deal?

Conventional loan and private investor/hard money. 50k at 10%, interest only payments, note due after 3 years.

How did you add value to the deal?

Rents are below market. We have simply (and slowly) brought them up.

Lessons learned? Challenges?

Even B+/A tenants can be a head ache.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Kristin Moore with Keller Williams East Grand Rapids is our agent.

@Narayanan Krishnamoorthy - great to connect with you.  I am not a realtor but I'd be happy to share who I use for the Kalamazoo area; George Wright with Fitzwright (Keller Williams).  George is a local investor and has been able to help me analyze properties qualitatively and quantitatively.  Feel free to message me for his contact info.

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $172,500
Cash invested: $4,987

Contributors:
Matthew Tanis

2 Unit in Grand Rapids. We purchased this from an obvious flipper and unfortunately paid retail. The purpose of this purchase was to upgrade to a "nicer" asset than our first property purchase. We transferred a roommate that is living in one of our Broadway property units into the main unit of this property. Cash flow meets the $100 per door requirement. We anticipate the main unit renter to be a long term renter; ie stable cash flow.

What made you interested in investing in this type of deal?

My team and I were looking to "upgrade" [find a bit nicer neighborhood, with a bit nicer property, that would attract a bit nicer tenant] from a C to B- neighborhood. We also had a tenant at our Broadway property that wanted to rent from us long term.

How did you find this deal and how did you negotiate it?

MLS - we negotiated through our agent based on the 1% rule and our cashflow requirements.

How did you finance this deal?

Approximately $5k out of profits from other rentals cashflow and the remaining down payment with a HELOC. Conventional 30 year fixed rate financing overall.

How did you add value to the deal?

We do not intend to add much "value" as it was sold by a "flipper". We will look for two stable tenants to generate steady cashflow.

What was the outcome?

A purchased, cash flowing property.

Lessons learned? Challenges?

I do not think we will look to purchase from flippers again. We did require a home warranty which we have already had to use (within 30 days of ownership). We will look to add full home warranty protection (including appliances) into future deals as this helps hedge and stabilize cashflow.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Kristin Moore from Keller Williams Grand Rapids East.

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $172,500
Cash invested: $4,987

Contributors:
Matthew Tanis

2 Unit in Grand Rapids. We purchased this from an obvious flipper and unfortunately paid retail. We used a Heloc to pay for the majority of the down payment - using a conventional loan for overall financing. The purpose of this purchase was to upgrade to a "nicer" asset than our first property purchase (Broadway). We transferred a roommate that is living in one of our Broadway property units into the main unit of this property. We have a vacancy upstairs that we are confident will fill within a 30 day period - at market rental rate. Cash flow meets the $100 per door requirement. We anticipate the main unit renter to be a long term renter; ie stable cash flow.

What made you interested in investing in this type of deal?

My team and I were looking to "upgrade" [find a bit nicer neighborhood, with a bit nicer property, that would attract a bit nicer tenant] from a C to B- neighborhood. We also had a tenant at our Broadway property that wanted to rent from us long term.

How did you find this deal and how did you negotiate it?

MLS - we negotiated through our agent based on the 1% rule and our cashflow requirements.

How did you finance this deal?

Approximately $5k out of profits from other rentals cashflow and the remaining down payment with a HELOC. Conventional 30 year fixed rate financing overall.

How did you add value to the deal?

We do not intend to add much "value" as it was sold by a "flipper". We will look for two stable tenants to generate steady cashflow.

What was the outcome?

A purchased, cash flowing property.

Lessons learned? Challenges?

I do not think we will look to purchase from flippers again. We did require a home warranty which we have already had to use (within 30 days of ownership). We will look to add full home warranty protection (including appliances) into future deals as this helps hedge and stabilize cashflow.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Kristin Moore from Keller Williams Grand Rapids East.

@CJ Wine

CJ,

You've picked a great location to start investing!  I've lived in SW Michigan majority of my life (went to college at CU - Boulder, what part of Colorado are you in?) and am currently investing in small multifamilies in the Grand Rapids area.  I believe 30K is definitely enough to get your first deal done.  In fact, that's pretty close to what my first deal required.  What specific strategies interest you?  

@Michael B.

Hey Michael - Thanks for creating this thread. SW Michigan is a great midwest location to invest and live! I live in Kalamazoo and have been investing in the Grand Rapids area with my business partners - small multifamily units primarily. Currently, we oversee the rehab and self-manage with a buy and hold strategy. I am always excited to connect with other like-minded investors. I believe SW MI can support many different strategies - Vacation Rentals, Short Term, Long Term, Flip, Multi, etc. And the MLS is still a great source for deals as well.

What specific areas of SW Michigan do you invest - GR, South Haven, St Joe, Muskegon, Kazoo? What is your decision criteria for doing so? Are you doing SFR or Multi?