All Forum Posts by: Ian Jimeno

Investment Info:

Large multi-family (5+ units) commercial investment investment in Austin.

Purchase price: $5,250,000
Cash invested: $25,000

Invested in a Multifamily Syndication with Zion Capital, headed by Kyle Marcotte and Van Hagye. The property is in North Austin next to the new MLS stadium, class C property which projected 15.5% IRR and 1.7x multiple over 5 years.

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

Excellent story and resume by Kyle Marcotte and Van Hagye (Zion Capital) with over $50 Million in assets under management as of Sept 2021. I'm a part of the mastermind headed by Kyle, so I am aware of his mentality, personality, and track record when going into this deal as a limited partner. 7% preferred return accumulated over the life of the business plan.

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

I was introduced to the deal by Kyle. The deal was negotiated by Zion Capital.

How did you finance this deal?

Syndication, loan of $3.4 Million, LP equity of $1.85 Million.

How did you add value to the deal?

Originally owned by a mom and pop business, looking for interior and exterior renovations to match the up-and-coming scene of North Austin amidst the increasing popularity of the MLS stadium developed approximately 1 mile north as well as the Apple Campus, Amazon warehouse, The Domain, etc.

What was the outcome?

Still under management. Distributions should be coming out sometime in October.

Lessons learned? Challenges?

Still under management and learning about the asset class. First multifamily deal as an LP. I would say to do your research on the property itself. I've heard some stories already saying the tenants are less than friendly, but that's what happens with a C-class property sometimes. I'm looking forward to when Zion Capital invests in a more stable asset class such as a B+ or A property.

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

Zion Capital is a fantastic business with energetic, enthusiastic, and brilliant leaders. Follow Kyle Marcotte and Van Hagye in their future deals.

Agreed, it's odd, their business websites are not focal points in the industry, it is the streaming services (Youtube, Twitch). Depending on the size of their brand/business, the title of the contact may change from Financial Advisor to CFO. I'll keep y'all posted.

@Jeffrey Donis Thank you! There will be some trail blazing, but I think I'm on to something.

@Everett Stonebraker thanks for the input. The market research sounds fun in itself!

The podcast idea seems to be a common theme. Seems like everyone is curious with this space; sounds like it would be an interesting topic of discussion!

@Jeffrey Donis Good food for thought, thanks. I wonder if going heavy into the "gaming" look may lose my credibility, however a nice touch of it will say that you're there for THEM and the industry.

@Chris Levarek appreciate it, and having them in a Podcast is a great idea, even for my own curiosity :)

Such an interesting business structure, I'd have to learn the skeleton first.

@Taylor L. Thanks for the input, and yes, they hire money managers to invest their money. My understanding is they have to be online all the time, so to have enough passive income to relieve them of that can be huge!

Hi BP audience,

I'm developing a platform to raise capital based on Hunter Thompson's Raising Capital for Real Estate. I find it to be a gold mine in resources, especially in looking to website building, content creation, and overall becoming a trusted source to invest OPM.

With the 21st century came the rise of Youtube stars, video game streamers, and social media influencers who made a killing in a short amount of time. Some of these younger folks have a team who invest for them, and I want to reach out to these team members who allocate the profits into assets. Ultimately, I want to turn them on to Multifamily assets.

Has anyone had any success in this space? I hear of capital raisers who have worked with high net-worth individuals such as physicians, doctors, attorneys, etc., but not social media influencers and Youtube Stars. Would you consider them small business owners?

Thanks in advance,

Ian

Hi @Keegan Dsouza

I agree with much of what's been already said, for example Debt Service Coversage Ratio (DSCR) of >1.2 (I look for 1.3+) and proper CoC, ROI, and IRR, but I also like to look at the demographics as well:

Population growth of over 15% from 2000-2019

Job Growth increase of 2% annualized

Unemployment Rate and Poverty Level

Overall demographic: College town? Married with kids? Low-key town with elderly?

Good luck!

Definitely, it would've been nice to be there in person. There's no substitution for in-person connections. I wonder how they'll organize any mingling hours in between speakers.