All Forum Posts by: Johannes Ariens

I agree with Bryan on this one.  I am a member of ULI but mainly only as it applies to my "real job".  If you are looking to get into large scale development it is probably worth doing but for smaller stuff not so much.

Alex,

Thanks for touching base.  I look forward to catching up with you.

Hey everyone I live in Seattle Washington.  My specific area of interest for multi unit is in South King County Metro and Pierce County/ Tacoma Area.  For recreational and lifestyle properties I am interested in Leavenworth WA, Westport WA, and Bend OR.  For the metro areas I am primarily looking for multi unit (2+ up to about 20) multi family deals that are positively cash flowing as I want to play in the buy-hold game primarily.  For the recreational I am looking for properties that are multi unit, Camping/RV locations, or a hybrid of the two.  

Professionally I work in the construction and development field and am  looking to generate a strong portfolio of cash flowing properties which I ultimately want leverage into recreational development properties.

If you are curious about my plans or just want to meet up let me know, I'd love to share war stories and am always looking of mutually beneficial opportunities.

Also, please add me on linkedin. 

Hey everybody,

I am working on my first deal to begin my true real estate investment journey.  The area I am looking at is in a relatively depressed area that is likely headed towards an upswing here in Washington State. I have been watching the area for about two years.  

Here are the property details:

5 apartments, 1 2 BR house, 7 RV hookups generating a monthly operating income of 4600 per month, about 55k per year.  The apartment units and 4 of the RV spots are occupied with long-term renters. The current owner states the expense are 14k per year creating a net operating income of about 40k per year.  The asking price is $249,000.

Here is what I am thinking for an initial offer noting the owner has stated that he may be willing to finance:

240k offer with 9% down ($21,600) and 6% interest on a 15 year term.  This would create a monthly cash flow of $720.16 with a cash on cash of 40% after I increased the annual overhead expenses to 24k per year vs the owners stated 14k (property could use some clean up and better management).  

So here are my questions in relation to the above deal:

1. Should I spend as little as possible on the down payment to hold onto more of my existing cash? This will lower my cash-on-cash but keep more in my pocket, however I highly suspect the owner will counter looking for a higher down payment.

2. Based in the down payment situation with regard to liquidity, is it wiser for me to liquidate some 401k and take the tax hit or bring partners into the deal?  I am confident I can get partners but not sure what the best move is here.  Also, if I brought in partners to cover the down, what is a reasonable way to setup the agreement with them relationally to returns etc. if I were to pay nothing?  Also, would I want to put down as much or as little as possible if I'm using OPM?

3. What is a good equation to use for establishing a fair offer # based off an existing operation?

4. Lastly, if I owner finance and then make some improvements and raise the rents how would I go about leveraging my appreciation out of it in a year or so to finance my next deal?