All Forum Posts by: Kevin Nguyen

An investment group found a 140 unit apartment complex valued at about 8 million.  They opened up the opportunity to be a KP to the public, however they are selective.  As far as responsibilities, it seems that it allows me to be hands-on with property operations.  It seems like a very good opportunity for me to dive in and learn....too good.  Why?  I have no experience. 

I've read (on the forums) that Key Principals are usually brought in because the lender requires a person with more experience OR a person with more liquid net worth to be on the loan.  However, none of these requirements were listed to be a KP in this deal.  Plus investment to be a KP in this deal is low -- well below 100k.  

Is there a traditional or standard role for KPs in apartment investing? 

All very encouraging responses.  I've got some learning to do then. 

@John Lenhart

@Michael Le Fortunately my mornings are mostly free and that's when I can have the opportunity to accomplish important tasks. Plus, I have no kids -- yet. 

@Michael Bishop Well-written informative article.  "By SEC rules, MOST apartment syndication opportunities will require that an investor is accredited." Is it possible to NOT be accredited and invest?   I saw MOST and thought there might be another way. 

@Drew Shirley Congratulations on your deal.  Are you doing this yourself?  Would you mind elaborating on the main challenges you faced?

Ultimately I want to invest in apartments one day. My original plan was like most others: buy a bunch of SFH rentals until I can upgrade to an apartment. But, then I thought why not go straight into apartment investing? Other people here have done it, except they quit their full-time job. Thus, making me believe apartment investing is a time intensive full-time gig.

If I can find enough capital to make a down payment on a small apartment complex or somehow partner with a team for bigger deals, is it a good idea to still work my full-time job?  Very detrimental?

@Tim Talbot

I am already seeing the wealthy and middle class starting repairs.  Businesses are back open and people are ready to work which are excellent signs.  Can you briefly explain how/what you invested in post Katrina?  

@Jesse Mao The criteria you mentioned sound very wise.  I am interested in how you found those numbers.  How did you conclude that an absolute elevation of 130 inches will lower your risk of flooding?  And how did you find out that the houses you drove by had an elevation of 120-125 inches?  I will probably add something like this to my purchase decision.  

@Jason Vo If I were to buy in those areas near bodies of water or levee districts, I would not hold on to them for too long. Those houses would probably be a BRRRR property for me. Rake in the profits when you can and the property is still dry.

Even houses in 500 year flood plain areas (0.2% chance of flood per year) flooded!  Just by terrible luck, these areas flooded even though flood maps showed the risk was minuscule. Maybe these maps were wrong.  Maybe this is a once in a lifetime event.  

Two questions:

Now that we have all seen the devastation of Harvey how will this affect your investing strategy in Houston?

 Will you still buy and hold confidently in 500 year flood plains thinking that these floods are statistically rare?

@Tony Castronovo

Glad your properties came out just fine -- especially the ones in Addicks.  I am glad I haven't bought any rentals yet.  I was looking into a certain neighborhood in SE Houston and now that whole neighborhood is underwater.  Imagine if there were investors that bought several houses in 1 neighborhood; all their investments would've been washed away. 

Houston's economy compared to New Orleans is much different.  People will stay and it's population will continue to grow. The TMC is the largest medical center in the world and will always be an anchor for jobs.  Houston will not have the same outcome as New Orleans.  

I'm analyzing houses in neighborhoods where market value is 100-150k: Pasadena.  Some schools are bad and some are decent in this area.  

Do houses zoned to decent schools get leased quicker? 

Do they command higher rental rates? 

@alan g.

Yep you're correct; the money reinvested should be taken into account to calculate CAGR.  Then if you spend all of your returns (or any of it) then your returns will obviously decrease over time since you decrease the amount that's compounded.  

I guess the cash on cash is a good criteria for deal analysis.  I'll search around the forum to get a glimpse of what others' criteria are.