All Forum Posts by: Percy N.

@David Stanford , in order to properly underwrite it the way a bank would, you should add a 7-8% property mgt fee and $250-350/door/yr for repair and maintenance.

Are these long-term tenants? What is the turnover? What does delinquency look like?

@Michael Newman, as for raising rent, you can do so for new leases or renewals but may not be able to automatically increase rents on existing leases, check the agreement

@Michael Newman, as for raising rent, you can do so for new leases or renewals but may not be able to automatically increase rents on existing leases, check the agreement

@Bob Gruenig, what @Chris Tracy may be trying to point out is that if you are creating a LLC and bringing in other passive investors into that LLC, your LLC may be subject to securities law.

The easier option would be to let each individual come into the syndication's LLC directly.

If you want to have your own LLC for your own benefit or where every member is active, that is another story.

Also agree with Chris that you should consult with an attorney.

@Naimah Lewis keep in mind that with the new tax laws you may not be able to write off HELOC interest or so I heard. So you can use the HELOC as a short term instrument and then refinance it out but make sure you can get the leverage you want.

@Melanie McDaniel , besides the NW, how much liquidity is the bank requiring?

We are working on a deal where the bank is requiring NW of the loan amount and 20% liquidity (which is twice the norm). And of course, their definition of what is considered liquid is also very narrow (pretty much cash and public securities).

There are people out there with a $20-$25mm NW so as @Brian Burke suggested, you can approach a couple of them but make sure you don't have too many carveouts or too many GPs as these players shy away from those.

Good luck.

@John Cassel , we are in the King of Prussia area and did a 101 unit, 124 unit and are under contract on a 587 unit deal.

Also invested in about 1700 units.

Feel free to reach send a PM and I would also reach out to David Zook who is in Lancaster and @Brian Adams .

Good luck!

@Darren Mesibov , we have an apartment complex outside of Dayton, OH and also in TX.

All the markets you mentioned are relatively well known and you will not have issues finding lenders if you have a good deal and some experience, net worth and liquidity.

Not sure about your area, but many states have laws on RUBS and what can and cannot be billed back to tenants, so make sure you comply with those. Although for a small property you may not have common water utilities like pool, laundry, etc , though you may have lawn irrigation.

e.g. In TX you cannot bill back more than 75% of the common area utilities.

@Anthony Palmiotto , what is the total purchase price and total Capex needed?

Most likely the total rehab will be more than the $91k.

Go to some local REIA meetings and meetups and see if people are interested in JV on this deal.

Look into the Small Balance loan for $1 - $5mm. Its non-recourse and they will allow you to put some funds towards rehab.