All Forum Posts by: Michael Klinger

Thanks for the replies

I am looking to lock down a property management resource for service that will begin either at the very end of December or early January (2018), depending on closings.

This will be about 63 units up and one that needs a rehab. With 28 on one property on Beechmont, in Mount Washington, 14 more close by and also on Beechmont in Mount Washington and 21 in the Mount Airy area -- on one two-building property.  the Mount Airy property is the one that has needs a single unit re-habbed.

Units on all properties are currently basically fully rented.

The I am an out-of-state (soon to be) owner. My owner style will be initially hands on, and then increasingly hands off as the transition of ownership settles in. I am prepared to handle certain aspects of management if such makes sense. 

So I will definitely need help with the local handling of maintenance, turn-over, filling vacancies, etc. The handling of bills and books might fall onto other resources. I have to get a feel for what scenarios work for all.

If you have recommendations, or would like to suggest yourself or your company, please PM so we can be in touch to talk it through . Looking to lock in my pick in the next two weeks.

I posted a similar over the weekend with little response. Here I will be more specific:

I'm closing on 3 separate multi-s at the same time in the same area. Nothing crazy, or over extended, Pretty conservative leverage actually with down/equity coming from a 1031 exchange. These three properties will represent most of my commercial portfolio.

I have three banks heading toward a soft yes on everything. The most enthusiastic and responsive is regional bank offering a blanket, or three separate loans depending on my preference. and we've boiled it down to 2 options. a 5 Year ARM that resets every 5 years, or a 25 year fixed. There is a 1 percent spread between the opening rate of the 5 year and the 25 year fixed.

I believe interest rates heading up.  And then up some more.

If this was a loan on my home, I'd pick the fixed. I'm leaning strongly towards the fixed, even though it will add short term costs, for the long terms security of it.

However, I also realize that it is very unlikely that I will make it that many years without wanting to re-fi to cash out and do other deals, even at the expense of potentially higher potential future interest and/or short term pre-pay penalties.

Thoughts from experience?

It adds about $10k in interest costs in the first year versus the lower rate ARM, and interest cost down from there every year I keep the loan in place. So $10K less cash annually for starters. Not life or death relative to the big picture.

Hi all,

I am doing  a few Commercial/Multi-family deal(s) simultaneously and heading down the path of bank loan(s) with a couple of regional banks.

I am being offered from the same bank several scenarios. 

Of those, the two I am considering: A 5 year fixed/arm, resets every 5 years, 25 year amort. Or a 25 year fixed for an interest rate of one percent more than the 5 year fixed/arm.

Curious on what kind of response these two options get from others and what others would consider more attractive in their own situations and why.

Sorry for delay. I was in tax extension black hole scrambling to extension deadline. Thanks all for input on my hen house.

Sold commercial office. Now in a 1031.

I have a few weeks left on my identify period. After years to think about it, I have just a few weeks to get a deal in place.
The years of thinking about it process, strongly persuaded me to head in the direction of out-of-state multi family with professional management, when the time came. And here we are.

Without getting specific about the amounts, it's quite a bit more than one's first duplex. So what i have in exchange money could become quite a number of units, depending on how much leverage I would want, and dependent on securing such a loan.

The issues i am having, are this:

1.) Even though I am an experienced small business person,  and an experienced commercial property owner, I apparently can't necessarily run around with my down payment money, call it 25 percent down and expect the deal to be pushed through. So far lenders seem to want to know that there is some level of experience level in that specific sector, and if not then other factors have to considered and maybe concessions made. The size and/or quality of the deal seem to be at stake.

2.) Chicken and Egg: I can't seem to (so far) get a lender that will work through the scenario with me, so I don't otherwise waste everyone's time. The lender says " Show me the specific deal, with a viable offer that is already in striking range of acceptance and we'll run it by the underwriter. The Broker says: Bring an offer with proof that you can get the deal funded.

3.) I'm not feeling a whole lot of motivation from the parties I am contacting to take me seriously. Admittedly, I am not connected, not part of the good old boys network. My money is real. My need to push through this 1031 is real. I'm sincere and ready to go on a rational deal that can get funded and close and meets my goal which is a priority on income.

Thoughts?

@Dave Foster... Thanks. Phew. That makes my head hurt. But thanks.

Economy of scale, no doubt... However, Is there a cost "per unit"  that seems rational for inspection services on a deal that is 10 percent the size of your recent example?

What would fellow investors say is a rational approach to having a (say) 50+ unit building inspected?

I am not particularly interested in knowing about loose outlet covers and those kinds of nit-picks I've seen in inspector reports. I would like to know if the roof or if the mechanicals are all going to die tomorrow.

Would you have a random sample of units inspected? Rather than every single units. Cost/time being the consideration.

Also, do you typically personally tour every unit? Is that normal/rational? Or overkill?