All Forum Posts by: Joey Budka

It’s a 22 unit apartment complex  in a populous submarket of the Bay Area.

If your units are covered by the legislation, it will revert back to 5% plus CPI. The bill is retroactive dating back to March 1, 2019 I believe. Make sure to adjust rents immediately on January 1st, as tenants will no longer be lawfully forced to pay above the allowable increase in 2020. It sucks, I know.

Any referrals out there on this? Property is located in unincorporated area of Santa Cruz County, CA in Northern California, about 30 min drive from core Bay Area. Incredible location with massive upside. Looking for private money/hard money/bridge financing for the purchase, and we'll consider additional funding for the renovations as well if the interest rate and terms make sense. Non-recourse preferable, no pre-payment penalty, at least 1 year term. We're looking for 75%-80% LTV. We're non-contingent right now, set to close escrow in the next 60-90 days.

Thanks in advance for referrals!

@Eamonn McElroy Much appreciated, thanks for the feedback. 

Can you elaborate a little more on the advantages of having an S Corp vs. the LLC if I'm flipping often/full time?

@Matt Mainini I was just referred to a really good CPA out of San Jose. PM me for details. 

Also, noticed you're in the SC area. Maybe we can get coffee sometime and talk shop/exchange ideas? I'm always good for some Verve Coffee...

Can anyone provide insight into various approaches to structuring an entity for a single-property acquisition with two partners, one being the operating/managing partner, and the other being the silent majority equity partner? 

We are in contract on a deal and need to draft an operating agreement that outlines responsibilities, profit share, etc. before we obtain our loan and close in the next 60 days. 

We have everything roughly agreed upon, so we just need some guidance about best approach and the pros and cons of an LLC vs. LP structure.

We will be purchasing a short term, value add flip opportunity. The partnership will likely be designed for this deal only, as we all intend to take our profits upon a profitable exit post-renovation within 3-9 months.

Can anyone recommend a real estate attorney and CPA in the Bay Area, or more specifically, in the South Bay or Santa Cruz? Ideally someone with deep knowledge in structuring investment partnership/sponsorship entities, as well as tax strategy. Thanks! 

@Stephen Masek My brother @Alexander Budka and I have combined 13 years of experience owning, managing, leasing and brokering NNN deals. Honestly, it may sound overly simple, but the number one aspect to consider when buying NNN deals is the classic RE investment aphorism: location, location, location. Other things to consider are the strength of the actual entity the lease is signed with (and make sure to thoroughly understand leases!). Evaluating rent-to-sales ratios can give insight into the performance of the business. Definitely analyze comparable sales and lease comps in the area.

NNN acquisition criteria really varies depending on your risk appetite. You're probably looking at NNN nationwide I presume? A slightly higher cap rate of 6%-7% out of state vs. a 4.5-5% cap rate in CA isn't that great of a difference in the long term. NNN deals located in in-fill, highly populated, growing areas have a much brighter future in terms of re-leasing potential if/when a tenant decides to vacate, versus some random property in Nowheresville, Midwest that has very limited future re-leasing potential.

Now is actually a great time to buy NNN deals. Because the uncertain interest rate environment, NNN sellers are more likely to be flexible on pricing as the asset class is closely correlated with interest rates, which are on the rise, meaning its becoming more of a buyers market out there.

Does anyone have any experience adding washer and dryer units to large apartment complexes? How much does it cost on a per unit basis, including, labor, materials, W/D units, etc.? 

Also, would be helpful to hear from investors operating within in-fill markets like Bay Area, LA, Boston, Seattle, NYC, etc., where labor costs are a big factor to consider in budgeting this out.

What are the premiums you're achieving versus units without washer and dryers?

Can anyone provide reliable general contractors that have experience remodeling the interiors and exterior of apartment buildings in Santa Rosa? We have 20 apartment units we need quotes on ASAP.

Thanks BP community!