All Forum Posts by: Percy N.

Much higher risk and hands on property management needed. Not recommended for new investors.

@Murray Clark, I should have clarified that our hotel conversion project was not in Miami and my advice was more general regardless of the specific market.

@Murray Clark in 2019 we converted a 88 key hotel into corporate housing (STR and MTR) before the term "adaptive reuse" was coined.

I would say make sure you understand what zoning you are in and also understand the desire and goals of the local city planners before you dive in.

There are other items like ongoing regulations and taxation that also come into play.

If you can make it work, it can be a very profitable endeavor.

@Jourdan, with your experience, it should be pretty easy to find partners or capital from hard money lenders. Even though you have experience in contracting, if possible, do a project or two for an experienced investor who can show you the ropes for investing yourself and who may become your capital source.

If you tell people at the REIA about your contractor background and that you are looking to build a team so that you can do this full-time, they will automatically come to you. It may not happen in the first meeting or two but keep going to these meetings, offer to visit and bid on projects for other investors and see who the real players are.

Many moons ago I had started out by providing capital to contractors for flips and partnering on them 50/50.

There are many lending firms like LendingOne, RVN, other lenders are even on this site that may fund the right deals.

My recommendation would be to network locally, especially at a REIA (Real Estate Investor Association) to meet people interested in RE, who have the capital but not the time or the skills and split the profits with them,

Make sure you have an agreement in writing up front that covers the roles, responsibilities, capital commitments and profit sharing.

The water/sewer is the tricky part.

Utilities can be separated and there are RUBS (Ratio Utility Billing Systems) out there that will bill back a proportional amount to each tenant, but these are typically not worth it for smaller number of units.

I would either add a flat utility fee (based on floorplan type) if your local laws allow it or look into bundling it in the rent. What is common with your competitors? What is the ROI for any alternations you try to make?

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@Anaim Murcia you may want to move this to the Marketplace instead of posting it here.