All Forum Posts by: Josh Edwards

I agree with all of the above, however, it's a lot easier said than done to say put more money down and use long-term debt. A lot of deals being done in the multifamily value-add space right now are being down with floating rate bridge debt. This is due to the high loan proceeds bridge debt provides, along with 36-month interest-only periods. 

Many passive investors looking to invest in Multifamily Real Estate syndications aren't looking to invest in deals with low IRRs. IRR will inevitably fall when loan proceeds go down and hold periods are longer. Thus, the only way smaller syndicators can compete with other groups right now is by utilizing bridge debt. If you're looking to buy core or core+ assets in a primary market with a high physical barrier to entry (which is what investors should theoretically be doing), you're IRR is in the 4-10% range. It's quite challenging to sell these returns to everyday investors. Institutions can accept these types of returns because they are working with more money. So what's to be done? That's the magic question that I think every syndicator should be asking themselves, as I don't think anyone truly knows how to move forward with new acquisitions. It's a fascinating, yet kind of concerning topic, so it should hold some weight to it.

Hey Jordan, nice to meet you! I work for a multifamily syndicator with over 1,000 multifamily units under management. I know he usually recommends new people looking to start in multifamily to get in through capital raising. This is mainly because finding multifamily deals in today's market is extremely competitive. My boss's operating partner has been able to find many of his deals through broker relationships, which are critical in today's market. If you can raise capital for an Operator with lots of experience, not only will you be able to get your investors a great return, which helps build credibility, but also allows you to leverage their track record for future deals. Learning from someone already entrenched in the business and being on the General Partnership team with them is a tremendous value-add to your investors when you're looking to operate a deal on your own after your first deal.

I'd recommend you start in capital raising, as you already have a background in sales (wholesaling). I am sure you have developed efficient systems to manage your wholesaling business, which could help you in capital raising. 

I'm in New York too! I'm further out east though. If you'd like to schedule a call, below is my meetings link. 

https://meetings.hubspot.com/j...

Hey Michelle, nice to meet you! I work for a multifamily syndicator with over 1,000 multifamily units under management. I know he usually recommends new people looking to start in multifamily to get in through capital raising. This is mainly because finding multifamily deals in today's market is extremely competitive. My boss's operating partner has been able to find many of his deals through broker relationships, which are critical in today's market. If you can raise capital for an Operator with lots of experience, not only will you be able to get your investors a great return, which helps build credibility, but also allows you to leverage their track record for future deals. Learning from someone already entrenched in the business and being on the General Partnership team with them is a tremendous value-add to your investors when you're looking to operate a deal on your own after your first deal. 

Finding investors could be as simple as reaching out to friends & family to see if they'd be interested in investing. Other ways you can find investors is through websites like this one, LinkedIn, Facebook, etc. You can participate in events such as Real Estate Investment Clubs/Associations, Charity organizations, your local chamber of commerce meetings, or even just attend meetups of activities you're interested in. 

There are all sorts of ways you can structure deals, as I am sure you know. We do syndications, so typical equity splits for my boss are 70/30 equity splits, 70% to the LP (passive investor), and 30% to the GP (us - the syndicator). 7% preferred return, 3% acquisition fee, (depending on the deal), 2% asset management fee, 1% disposition fee. You can also do joint ventures, where you'd have larger investors come in and fund the deal, these are typically structured differently. There's no one size fits all here, but typically you, the GP/operator would get some type of equity in the deal.

If you're not looking to raise capital, generally, there are a few ways to get involved in a General Partnership team:

- Finding a deal (establishing broker and owner relationships)

- Underwriting (learn how to underwrite deals. I recommend Michael Blank's Syndicate Deal Analyzer, as it's pretty straightforward for newer underwriters).

(Finding deals and underwriting generally should go together, as you should not be looking for deals if you do not know how to underwrite them).

- Capital Raising

- Key Principal (Loan Guarantor)

I'm always looking to connect with fellow investors. Below is my meetings link if you'd like to schedule a call. 

https://meetings.hubspot.com/j...

Let's say I were to buy a building in New York City and my business plan to increase rents was to buy rent-controlled tenants out of leases. Once a tenant leaves, the rent-controlled unit becomes free market. Is this legal in New York? And if so, do you NYC investors think tenants would give up their rent-controlled apartments in NYC for cash?

I can't seem to find anything stating that this is not legal, so is there anyone who has tried this before? What was your outcome?

Thanks in advance!

@Josh Edwards bump

@Josh Edwards bump

What is the biggest problem you as an investor run into on a day-to-day basis that you are willing to pay money to solve?

Answer can be anything related to your real estate career. How much are you willing to pay to solve this issue?

@George Fabricatore Hey George. I’m josh I’m in suffolk county as well. I’m going to Stony Brook University for Business Management and Finance looking to get a job in real estate development or investments. I sent you an invitation request if you want to connect!

@David Thomas

I’m seeing pretty much the same here. Investors are buying homes at way too high of a price and they are trying to artificially inflate the market values of the homes they flipped. But this whole situation has caused a lot of investors near me to move to lower income areas and have turned them into good areas to fix and flip.

Like you said though, I don’t know how long this crazy demand can last for. I guess it all depends on if and when NYC people want to move back there.

@Joe Splitrock

Hey Joe, thanks for clearing that up for me!

That makes a lot more sense. Just a crazy market though, it makes me wonder how long it could possibly last for. For me with all the cash buyers coming from the city, I wonder if this will all just go away with covid, or is all of this demand just going to be priced in from now on and city people stay?