All Forum Posts by: David Boley

 @Henry Clark - Is this the post you are referring to?

Self Storage- LLC Operating Agreement (biggerpockets.com)

Great to hear, @Greg Banheh. Thank you for the follow-up!

@Greg Banheh

I had a similar question and just posted it in the forum. Have you advanced at all with your business partnership? It would be great to hear about your decision making process and result.

Thanks!

Greetings, BP! After years of analysis paralysis, I am coming back around to real estate investing. To acquire more properties in less time, my nephew and I are thinking of forming an LLC together and pooling our money to purchase properties to rent out.

Any advice on:

* Forming an LLC (specifically in Minnesota)?

* Going into business with a family member?

* Cashflow distribution with business partner?

* Saving for CAPEX and other costs?

Thank you!

Used to live in the area and may go back there some day.

@Kevin Collins Thank you for this thread and posting about your experience with REI. I live overseas and don't have ready access to a local market to research, understand, and invest on my own. In my case, I think TK is the best option - at least to initiate my real estate journey. As @Eli Konig mentioned above, going into RE right now without a lot of experience and without knowledge of a local market I think makes TK a decent beginning option.

I've been in communication with REI and going through their process right now. If you have any further comments about your experience since you began this thread, I'd be happy to hear about it. And I really appreciate @Chris Clothier giving you a call and talking over your concerns. That shows integrity and a prioritization of customer satisfaction. Once my experience is further underway I will report back as well.

@Alexander Johnosn

Hello there! I've been hoping to invest in the Tallahassee area but I've not had any luck with PMs. Any chance you can share your PMs info? Glad to hear that you've got good cashflow in the area!

Great thread. Thanks, @Jt Marting for starting it and for the advice from @Charles Kennedy. I'm also looking into the Tallahassee area for a rental property and was considering around the university. I'd be doing it from afar as I don't live there currently. Good luck!

You hit the nail on the head with management fees. 50% of rent for placement, 25% per year to renew lease. I hadn't factored these costs into my analysis as initial and yearly expenses, respectively. The company also provides preventive maintenance checks twice per year (optional) at $144 each. They also take pictures of the property at this time so I can monitor how it is being treated.

Thanks for the comment!

Boom! Fast responses and great information.

I was able to calculate the "Total Profit if Sold" but it doesn't seem to match what BP says it calculates. I was able to mimic my table results simply by calculating the Property Value - Initial Investment - Loan Balance + Cumulative Cash Flow. There was no consideration of the closing costs in this calculation.

I was unable to mimic the Annualized Total Return, except for the first year. I took the Total Profit if Sold and divided by my initial investment. For the following years I did the same, but divided by the number of years of holding the property - but the values are different than the table. I tried adding the closing cost percentage (10%) to the total cost of investment, but the numbers are still off. I want to trust the math, but I also want to understand it!

@Account Closed This makes a lot of sense! "So while the cash-on-cash is literally cash in your pocket every year, the annualized total return is your annualized rate of return over the life of the investment when you sell a deal. You can think of this as comparable with the overall returns of the stock market, whereas the cash-on-cash is more comparable with dividend or bond yields."