All Forum Posts by: Jimmy Klein

We own hotels. This is a solid strategy assuming the hotels are in the right location. I will say a few things to keep in mind though. Hotel rooms won't be individually metered. So your rent will have to be inclusive of all utilities and probably even cable and tradeYou might also not have on-site amenities such as individual laundry machines. The larger flagged hotels keep this on-site for the guest to use, but its usually one or two dryers. You'll also need to spend significant capital building out kitchenettes in each room. I am assuming that since its a motel it doesn't have any in either room. You are basically trying to convert it to an extended-stay hotel. 

Also is the property exterior or interior?

Anyways feel free to PM me if you need more help. Done a lot of hotel acquisitions, but we haven't converted any of them though.

Regarding this transaction, the HML set very ambiguous terms it just mentions that if the project doesn't close or you back out, then you have to pay. However, you still are planning on closing the project and you have no intention to back out. So therefore he is not entitled to get anything. Read the terms and if he still acts like this, tell him to get a lawyer. I guarantee he won't say anything then. He's already sweating over a few hundred in legal fees he spent, he won't spend more arguing the contract.

@Lee Kendall 

I am looking at MD/DC area not necessarily Baltimore. Pretty much stuff around the 270 corridor going into DC. I am looking from that all the way up to Hagerstown/Frederick.

@Johnson Ejalu

I am looking at single family. Could be condos or townhomes. Basically looking to meet the minimum 1% rule. I don't need financing, but will need a property manager that is experienced in the market.

I've seen a few like Philly Income Properties but wanted to know if anyone had experience with any that are good. Also anyone know any turnkey providers in Maryland? 

The question is not about the guaranty. We will have additional pieces of collateral, but I am referring to the land being used as equity. 

There is a self storage facility for sale near where I live. The facility is right near the interstate. Part of the sale includes and additional 2 acres of land which is right beside the facility. The price is $600,000 for the 1.7 acre facility (60 units) and the 2 acres. I want to buy the facility and land but plan to develop a medium sized hotel. I have developed several over the past few years. The question I have is I don't want to have both the facility and land under one lien since I want to do a separate development. I spoke with the seller and they said they would accept two prices. I would pay $1 for the 2 acres of land and the remaining for the storage facility. This way the land I would own without a lien. Then my goal is to go to a bank and have the land used as equity for a downpayment. Is this possible or will the bank not consider the land since I only payed $1 for it?

@Jay Hinrichs

Yes, same thing, but my deal is commercial instead of single family. I know the 95/5 equity structure is common. I was more curious to know about the funding process works, if someone has been through it. Or working with institutional equity providers in general.

I am currently purchasing a multifamily building in California. I have found a small investment group looking to provide 95% of the equity and I would provide the 5%. I just wanted to know if anyone had experience with this structure and how would the escrow of funds work. Would we both submit to the title company or will the investment group just wire me the funds and I sign a contract stating the funds are for the purchase of a property? I am sure they will want to do it a certain way, but I prefer to do it in the right way. Anyone familiar with this? Also part of the funds include paying down closing costs and legal fees, so I would need access to some of the money to close. Any other additional comments regarding the closing on this?

@Alex Craig

Awesome information. I sent you a colleague request.

I'm looking at some turnkey properties. I see property managers charging just 8% of rent and thats not much considering rent can be less than a 1k a month. I also seen turnkey rentals where they even set up the LLC and do all the work for you. I just have a hard time believing $50-$100 a month in fees is really worth it for them.