All Forum Posts by: Marek Berry

Hi all, what do you think is a fair fee for my role in finding investment capital for this land-development transaction?

- The seller owns about six empty lots in TX in a desirable city. He's sold five of them and is also acting as the builder of the homes that will go on the lots.

- Seller has offered to "sell" me the last lot for $300K. He will build house, then sell the house + lot (it's essentially a loan to him so he has some capital to play with since it appears most of his is currently tied up).

- The return has a $50K guarantee but should go significantly higher depending on the sale price.

- He's a family friend and I trust him, plus he has significant experience in real estate.

I don't have the funds myself but am working to finding an investor.

Would you, the BP community, structure your fee based on funds invested OR profit once the deal is done, or both? And what would you set as the fee? I understand 3% paid by the investor is a common finder's fee, but this also feels like a unique situation that could allow for a different structure. I've also had recommended a 5% acquisition fee is together with a recommended minimum of a 25% interest in the project, which sounds very generous to me.

Thanks!

Will DM you now @Richard Helppie-Schmieder.

I'm seeking input on what the BP community thinks is a fair fee for my role in finding investment for a land-development transaction.

- The seller owns about six empty lots in TX in a desirable city. He's sold five of them and is also acting as the builder of the homes that will go on the lots.

- Seller has offered to "sell" me the last lot. He would build then sell the house + lot (it's essentially a loan to him so he has some capital to play with since it appears most of his is currently tied up).

- The return has a hefty minimum but can go higher depending on the sale price.

- He's a family friend and I trust him, plus he has significant experience in real estate.

I don't have the funds myself but am working to finding an investor.

Would you, the BP community, structure your fee based on funds invested OR profit once the deal is done, or both? And what would you set as the fee? I understand 3% paid by the investor is a common finder's fee, but this also feels like a unique situation that could allow for a different structure. I've also had recommended a 5% acquisition fee is together with a recommended minimum of a 25% interest in the project, which sounds very generous to me.

Thanks!

@Mary Cronin Thanks for this, very interesting. To clarify regarding the 25% interest, I assume this is suggesting I take 25% of the profit and the money guy takes 75%, correct? 

I'm seeking input on what the BP community thinks is a fair fee for my role in facilitating a transaction. 

The seller owns about six empty lots in TX in a desirable city. He's sold five of them and is also acting as the builder of the homes that will go on the lots. He's offered to "sell" me the last lot and he would build then sell the house + lot (it's essentially a loan to him so he has some capital to play with since it appears most of his is currently tied up). The return amount will be agreed upon before the deal is closed and will be a dollar amount, not a interest rate. He's a family friend and I trust him, plus he has significant experience in real estate.

I don't have the funds to do the deal on my own but am working on finding an investor.

Would you, the BP community, structure your fee based on funds invested OR profit once the deal is done? And what would you set as the fee? I understand 3% is a common finder's fee, but this also feels like a unique situation that could allow for a different structure.

Thanks!

@Neil Narayan @Danny Webber

FYI I asked the company what their tolerances are and this is their response: "The standard for foundation tolerance is the rule of L/360 or approximately 1 1/4 inch of deflection for each 10 feet. Our standard is our measurement should be within 3/4 inch of the measurement we recorded."

The last sentence is confusing, but I'm guessing they only have to be accurate to 3/4"?

It seems that since nothing has shifted over 1" there's not much recourse I have at this time.

@Danny Webber The original post-elevation report is included in the diagram in my post—the most recent numbers are the larger circled notations. I'm up .7 in one area. That seems like a lot to me. But if the foundation is rising rather than falling does that have anything to do with the foundation, or rather slab sagging between beams or poor drainage due to the all the rain last year?

And conveniently, they don't give any hard numbers in the original agreement. I now know to be asking for this. But in your opinion, what is an appropriate tolerance?

@Neil Narayan That's a good idea. Still trying to determine what an appropriate tolerance is, and if their work has anything to do with the current issues to begin with (see my response to Danny above). That will then help me know if I should sink a little $ into holding them accountable.

Hi All, thanks for reading.

As background on my current issue, I had significant repairs made to my slab foundation home in Austin, TX upon purchase of my first rental property 4.5 years ago. Due to my own ignorance (no denying it) and the repair company's recklessness and negligence most of my plumbing was destroyed in the repair process, costing me tens of thousands of dollars. I strongly considered suing, going as far as contacting a few lawyers, but ultimately declining not to.

Now there are cracks in some walls and a few doors won't stay closed. The foundation repair company came out for a warranty evaluation. Here's the gist of their report: "As you can see for the large part of the home the elevations are within the tolerance measurement. I also noted areas where the home is higher than it was when we finished this could be caused by the slab sagging between the beams in areas that do not have piers or they could be the result of poor drainage...At this time I can find nothing that is in need of warranty repair."

Here is the elevation key they provided:

I'm deeply suspicious of these guys and would appreciate some input from any of you out there that have more experience in foundations and what, if any, obligations the repair company has in this specific situation. Thanks for any and all help!