All Forum Posts by: Percy N.

@Michael Blank, we like Secondary markets in the Southeast that fly below the radar as well.

Interesting you mention Huntsville, AL as an example - we started investing in Huntsville around 2019 and have done approximately 7 projects there (spanning ~1,100 units). In fact, this got some attention and put us on the front page of the Huntsville Business Journal.

We now have a Multifamily fund that focuses on 3-4 similar markets and the goal is to have enough dry powder to pick up good deals quickly, thereby benefiting the investors in the fund. e.g. Our last purchase in the fund was a newly constructed 98 unit Built-to-Rent community with room for an additional 120 units, that we were able to get at a 6% cap rate (a significant discount to the market).

Hope to buy a few more deals similar to this one in the fund. 

Happy to exchange notes for those interested in investing in this area. 

 Look for someone who can conduct a feasibility study in your market. Is it a large market? If so look for some reputed names or contact a local architect to get some referrals.

@Ravi Karuturi, its impossible to answer that without knowing the local area demographics, economic outlook, occupancy rates, building regulations, etc and therefore what the "highest and best use" of that land would be in that specific area.

How many units do you wish to build? 3 acres is not a lot of space (factor set-backs and parking), how high can you go vertically?

Are you trying to convert these to apartments?

For the purchase, try to have a general contingency that allows you to terminate for any reason you want not just specific asbestos, etc. it typically also includes environmental, survey, title etc.

What is your all in cost projection for the project? You may want to look at doing a syndication PPM if you are bringing in passive investors. Never too early to socialize and get input from potential investors (just comply with the appropriate SEC regulations).

What size property is it? 

For larger properties, we do lease audits, walk every unit, common grounds, etc.

Also make sure you understand the insurance and property tax implications.

If you are planning any short term rentals, make sure you understand local regulations, etc.

 I know of a property that was bought, the seller claimed there were valid leases, but the day after closing he disappeared and disconnected his cell phone number. Make sure that does not happen to you and you do not get stuck with costly legal headaches.

This is a red flag. 

Ask the seller to put leases in place prior to closing otherwise you will have a nightmare on your hands.

Hey @Kyle Callahan we are based outside Philadelphia.

Which markets are you targeting and what size property?

What are you looking for the sponsor to bring and what are you looking to bring?

@Alex Ficco thanks for sharing.

Was there a delinquency issue with the tenants? What was the screening criteria used?

@Lucien Perreault what % cash on cash do you distribute net to your LPs in the first 2 years?