All Forum Posts by: Michael Le

@Steve Iacobbo From the perspective of an LP/passive investor (ie you), I would say to know someone is to have at least a conversation with them about their business, their approach, their track record, and then more specifics about this particular deal. What is their involvement, are they the asset managers or involved in a lesser way?

From the perspective of a GP, to know someone would be to under the LPs background, their investment goals, their financial situation, and whether it is a match for what I am doing.

If you don't know them well enough then you shouldn't invest. And if it's a 506b syndication (I think I know the deal you're talking about and it is a 506b) then you can't legally invest anyway if you don't know them.

If it is a proper comp then theoretically you should be compared to other properties that have similar road access and similar entitlements and restrictions, so it doesn't make sense to add the $500k to the comped price. If the only comps are other pieces of land that are in the same condition as your property was 4 years earlier before all the work you put in, then you'll probably just have to let the market determine the value of all of that work. Hopefully it is worth much more than $500k otherwise you worked for free.

Just reach out to a Costar sales rep. https://www.costar.com/about/c...

It's not cheap though.

If there's already a broker involved then the Seller has listed the property and the only problem they're looking to solve is selling it for the highest price. Sounds like you're trying to find off-market properties to convince the Sellers you can solve whatever issues they might or might not have. It's not an easy thing to do, especially if you don't have the network for it, but if you're looking at smaller properties then direct mail marketing could still work.

They are reimbursed IF the deal closes. Deals do indeed fall through and in that case the GP eats those costs.

By definition you don't include it because you could have bought the property cash or with a bridge loan or with fixed rate agency debt. All of which will change what your Net Income looks like... but it doesn't change what your NOI looks like.

If you're in no rush, work on getting the property rezoned yourself and increase the value. Get utilities to the property to increase it even more. The closer you get it to be shovel ready the more you'll be able to sell it for.

 That 20-30% part is called the promote. Also called GP split, sponsor comp, carried interest, etc.

If you didn't use it up then it carries over. If you used it all up then there won't be any losses to offset your passive income until you get buy another property.