All Forum Posts by: Jennie Berger

Quote from @Andrew Moore:

I started my career as an accountant for a small real estate development company in Chicago that developed mixed-use residential buildings. The owner of the firm illustrated the real estate industry to me by drawing a pyramid. The bottom of the pyramid is the least lucrative & the top is the most. The bottom rung included professions like property management & real estate agents, while at the top of that pyramid was real estate development & syndication. 

Everyone may have their own opinion of where different professions fall in that diagram compared to others. However, my point here is that there are a number of different ways that you can get into that space. I've worked with developers who started their careers in the financial sector; I've seen developers get their foot in the door at a development firm where they can grow and learn the process of development without risking their own capital before going out on their own; I've seen individuals graduate high school, get their real estate license, and create strategic relationships with individuals in the industry and utilize those relationships to get into the development space. 

To piggy back on what @Wale Lawal said above. Getting a real estate specific degree, a finance or Accounting degree, or Economics degree (among many other types of degrees), may prove to be beneficial in giving you a base level of understanding to hit the ground running once you graduate. 

I think your first question was backwards, meaning it should be in this order -> getting started, working with experience investors, raising funds & finding capital. I believe the best way to put yourself in a position to work with and learn from experienced investors is to show that you have a conversational understanding of real estate, and a desire & willingness to grow. I recommend getting started by being an absolute sponge. Read every book that you can, engage in the forums, watch youtube videos, practice analyzing deals, and get to a point where you feel comfortable communicating with other investors. 

Once you have that foundational understanding & can have thoughtful dialogue with other industry professionals, I think it is much easier to network with experienced investors who might be willing to mentor you or partner on a deal. Once you have established working relationships & a track record of success/competence it is much easier to approach private investors with opportunities they may be willing to provide capital for.

You are in a great spot as you could look for summer internship programs with real estate development firms, or an analyst program for a company like Cushman & Wakefield (or other similar companies) where you may start to understand how to analyze or value larger assets.

I love the clarity you have at this point in your life, and wish you the best of luck! With a continued desire to learn and grow I think you'll be able to make it a reality.

 ☝️THIS.☝️ End of story. 🙏

I am currently working with a friend of mine who works for an attorney who does just this. They charge a percentage of whatever they end up saving you. So, if nothing changes, you pay nothing. 

Another option a colleague mentioned to me is a flat fee service. He used it for appealing taxes on his personal condo. I believe he said he paid around $150 and got to keep 100% of his savings from the appeal.

Since I haven't completed my process yet, I have nobody per se to recommend. However I hope this gives you some options!

@Tom Shallcross We'll be there. Can't wait!

We haven't developed anything over 4 units at this point @Jonathan Klemm. Thanks for thinking of us to help here however!

Quote from @Faiz Kanash:

Hey guys,

Anyone happen to have any good general contractors or developers they're able to recommend for work on a duplex in cook county or dupage county? Trying to get an idea on who I could work with, as well as ask about rough ball park prices before committing into my first investment property.  Thank you!

We develop and build new construction SFHs and small condo buildings on the North side of Chicago.  Our approx build costs are between $145-$190/SF, depending on exterior structure materials & finishes. 

It's almost impossible to give you an accurate estimate based on limited knowledge.  However, this is a ballpark price based on OUR pricing that I feel comfortable sharing with you. If we were hired as GCs/Consultants for this, add about 15-20% on top of that. 

*Add in demolition fees (if applicable) and land costs to the above. Note that while lumber prices have come down, other materials (cabinetry, plumbing fixtures, etc.) are increasing still. So, you'll also want to factor in an extra contingency buffer into your budget for 'unknowns' and 'material price escalations.'

I hope this is helpful!

Quote from @Tony Angelos:

How would you evaluate a tear down that is zoned B-3-2 in Chicago? I'm not sure I totally understand this zoning designation.

What would you do with it after you tear it down? Always start there.

We currently have a property zoned B3-2 in a highly residential neighborhood. It makes sense for us to apply for a 'special use permit' to allow residential on ground level (instead of forcing commercial/retail on ground level, which is what its currently zoned for, by right).

We could also have attempted to rezone to B2-2 but didn't feel it was necessary considering the property next door, and everything else on the block (Residential all the way through).

If you email me more details I'm happy to help. Can jump on phone too if you like. Prashanth and Samuel (both architects) are excellent resources as well and can definitely get more into zoning minutia. I am happy to help you analyze this from an investors perspective too, providing investor/development/broker insight as well as number $ analysis. 🙌

Quote from @Crystal Smith:

Quote from @Mario Morales:

I am using a reputable company to do some work for me under 5K. They will bill me when the work is done. I will look at the work, and if satisfied I will send them a check. Do I need them to sign lien waver at some point?

If they are a reputable company they will have no problem signing a lien waiver.  Get one.

THIS. PERIOD. ☝️☝️☝️ Especially if you're planning to sell the house or property you're renovating right after. The title companies (in our experience) always require them before closing! We get notarized lienwaivers along the way, for each payment, from most of our contractors.
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'YOU WANT TO BE PAID? GIVE ME A LIENWAIVER.'
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This includes 'contractor' LWs and, if the GC or Sub is buying materials, a 'Materials' LWs or a paid receipt from their vendor.
 
(*The only ones we may not get LWs from are one-off smaller jobs like post construction cleaning, material movers, snow plowers, etc.) 

 .

Hope this helps!

Thanks for the kind words @Jonathan Klemm! I wish I had more good advice, but honestly, I've never renovated a house to rent. Therefore I'm not sure my insight would be of much value. It seems to me that the consensus is: shower glass door. Mainly, to protect your investment (ie the flooring in the bathroom and potential issues that could arise down the road from water damage). While I personally don't mind a nice shower curtain, and avoid cleaning the glass after my showers as much as possible (what a PITA, lol), I'd think the glass door is the better option.

Hi Ralph: 

We are developers and licensed general contractors with the city of Chicago. To emphasize what @Jay Hinrichs said--and yes I'm exaggerating but trying to drive a point home--you basically need a permit to breathe in this city. :) Do contractors (and homeowners) do construction work on their home without them? All the time. Do we? NEVER. 

If you're a contractor--or homeowner--considering selling in the near future (or strictly renovating with the intent to sell NOW)--you'd be shooting yourself in the foot to not get SOME type of permit. Depending on the amount and type of work, an 'easy permit' may suffice. (ie: A so-called 'over the counter' permit, which is easier to obtain, cheaper, and still covers a fair amount of renovations that don't include anything structural or heavy MEP work.) So, if this contractor you're referring to just replaced kitchen cabinets, painted, and sanded and refinished floors, eg, an easy permit would totally have covered all of that work. This all begs the question: if the contractor is so experienced, why WOULDN'T he have gotten a permit in the first place?

Be that as it may, are you asking about whether a home inspection will pass? Or inspection(s) by the city? In our experience, a home inspector has never asked for city permits. Only the buyer's attorney asks for a full report, as well as proof of the permit showing all inspector signatures, after we are under contract. 

I'd be remiss if I didn't add the following: We work on the North and NW side of the city. Our price point is mid-level (700-900k ARV). Though it 'shouldn't', it might actually make a difference. I've heard of quite a few contractors working on properties on the South side, and maybe other less expensive areas of Chicago, without permits. And those renovated homes get sold with no problem... Where was this property located?

I wish this was black and white. Nothing in Chicago is. Unfortunately. Not sure if this was helpful. Hopefully some others will chime in soon with more insight...

Hey @Kean Chew:

We love Lakeview!

1. Are you renovating to rent or sell?

2. Sharing some pictures here would probably help so we can see what really needs it the most.

Look forward to seeing what you got! :)

Jennie