All Forum Posts by: Oleg Sergienko

Syndication would allow you to receive "sweat equity" and fees as the General Partner running the deals. Joint Venture is when you just split equity pro-rata on dollars put into the deal. Fund is when you raise a bunch of capital up front and deploy it over 1-2years+.

Sounds great! Thank you for your knowledge!
In my case - I am broker in South Florida with a large list of investors, who want to earn more than $1000/m Cashflow per every $200k investment stability with a very low risk. South Florida sucks with a good Cashflow because of the expenses.

I was thinking about the fund, because I personally plan only run the funds and do all the planning, admining and pumping the value of the properties as a main partner, and other investor will only contribute the funds for the downpayment as a limited partners. The plan is to split the equities of each property and get stable Cashflow to each partner.

0 Votes

Chicago, Illinois

Quote from @John Warren:

@Oleg Sergienko welcome to the forums!

For you to make the jump into apartment investing, I think you will want to decide on what asset class to jump into. The property you referenced is in South Shore, which is an area where there is a ton of activity. The broker who is listing that dominates the market, which is good for sellers typically.

Start with the end in mind on something like this. Who will manage in that area for you? Do you have the boots on the ground to handle that area? If this were my first investment, I would not necessarily jump right into that neighborhood.

Appreciate your insight and expertise John
thank you

1 Vote

Chicago, Illinois

Quote from @Philip Joseph:

This post popped up in my notifications because you mentioned Macon. I am an investor in Macon and the surrounding areas, but I also help other investors. I've done complete ground up rehabs to simple paint and floors.

I think $600k can get you in the game in Macon for 6-10 units, but anything more and you are looking at a huge value add that will not cash flow on day one. And even at 10 units, you will probably have to stabilize the property, which will likely take time and money. Once stabilized, it should cash flow well. For Macon, you will need to hold it at least 10-15 years to see some real equity growth. But, if you can hold that long, you should be able to double your investment. Savannah will likely be more expensive, but will also appreciate more.

If you decide to buy in the Macon area and need help with the rehab, shoot me a message.

Cajun

Thank you for your opinion and feedback regarding Macon, GA - 10-15 years sounds too slow for me for that return at this point in life. I am willing to risk higher.

If you have an extra minute, would you share your opinion about this deal without deeper research?

C+ Neighbourhood

13 Unit Apartment Building (Link: https://www.loopnet.com/Listing/7828-S-Essex-Ave-Chicago-IL/30374409/)

The average Rent is $1400-1500 (to be safe $1300, but I am extremely confident that I will be able to rent higher adding value and convenience to the tenants and treating them as a bit with a higher level of service) - $16,900 at full occupancy and ~$12,000 at 70% building.

Asking $620k

Debt service $4,352/m (10% Interest, 30-year amortization, 80% LTV)

Taxes ($1033/m), insurance ($833/m), maintenance($1000/m), property management ($2400/m)

Total - $9,613 (very rough estimate)

Cashflow with 70% occupancy - $2,387/m (Cash flow pro-forma with adjustments $7,000/m+)

What am I missing?

0 Votes

Chicago, Illinois

Quote from @AJ Exner:

@Oleg Sergienko,

Thank you for throwing it out there! My initial thoughts are on the financing side and really on the expected funds. It sounds like the idea is good for more of a SFR, or a 1-4 unit rehab but my concern from a lender's perspective is the needed experience in the more 10+ unit space to give "normal" (80% leverage) on a deal like this.

Setting up something like this in a bridge loan to take on some of the rehab could be the best way to go, but most will want to see some 10+ experience to really get what you are hoping.

Do you have someone with some "experience' in that space who might do a JV?

Thank you for your response and opinion,

My goal is to do a JV pretty much, where 2 of my partners will be funding partners and I will be on a fund managing role.

I do have a direct lender with 80% LTV if I have a deal with 95% occupancy and DSCR 1.2.

I am trying to understand if it's a good idea to go with this plan, let's say get a fully stabilized property for $3m with a down of $600k +- light rehab budget and slowly (within 18-24m) using the cash flow and extra funds make a BRRRR at large scale.

My biggest concerns are - to find a deal and then actually get a cash flow from day one.

The opposite way of this plan is to get to slow-grow neighborhoods and buy 3-5-8 SFH in cash or 50% hard money in areas like Macon, GA, or Savannah GA, and do BRRRR as well and diversify with 50% long-term rentals and 50% short-term rentals

But really, the main idea is to make a smarter move with fewer movements along the way and get it safe as well.

0 Votes

Chicago, Illinois

Good afternoon Real Estate Experts

I am planning to start commercial real estate investing later this year with the following plan:

Looking to get 10-20-30-40 unit commercial multifamily with 20% down and preferred lender (the downpayment funds will be combined within 2-3 investor either to syndication or real estate fund, not yet decide it). The initial plan to get a building with outdated market rents, but 90-95% occupancy and light cashflow. Then within 6-18 months make a full rehab and updates with a preferred contractor, get better leases and refi.

Initial budget $250-600k +-

Please advice if it's seems like an ok plan in your opinion (preferably if you have personal experience).

Do you think it's a good money investment considering current crushing market and if you consider this as a safe investment.

My experience: 6 years of real estate brokerage in South Florida, + One successful flip with a $300k revenue.

Thank you for your time!

2 Votes

Chicago, Illinois

All Forum Posts by: Oleg Sergienko

Oleg Sergienko has started 1 posts and replied 5 times.

Post: Commercial Real Estate Investing

Post: Commercial Real Estate Investing

Post: Commercial Real Estate Investing

Post: Commercial Real Estate Investing

Post: Commercial Real Estate Investing