All Forum Posts by: Philippe Schulligen

Investment Info:

Large multi-family (5+ units) commercial investment investment in Memphis.

Purchase price: $2,600,000

Cash invested: $320,000

80-unit property syndication

What made you interested in investing in this type of deal?

My partners had previous experience in the market.

How did you find this deal and how did you negotiate it?

Loopnet

How did you finance this deal?

Freddie SBL loan with Arbor

How did you add value to the deal?

We defined a renovation plan with the Property Manager

What was the outcome?

Property is cashflowing.

Lessons learned? Challenges?

We bought from a mom and pop owner, that led to difficult negotiations.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Hi Brent,

96 units

Hi BP community!

Looking for a reference to a PM company for Multifamily property in Jacksonville, FL with majority Section 8 tenants.

Also looking for anyone on the forum with experience in  Multifamily in Jacksonville, FL + Section 8.

Thank you.

Hi @James Little

Thank you for your answer.

I should have been more specific in my question, I am buying with 8 years left in PILOT program and I would like to model a sale price (thanks to the cap rate and NOI) with 2 years left in the program.

The broker suggested to prorate the taxes increase up to the end of the program. This is how I modeled that: current taxes under PILOT $24K (year 1 of my ownership), taxes after PILOT $100K (year 8). I increased the taxes every year between $24K to $100K. At year 6, I get $78K in taxes - the year of my projected sale, $89K year 7 and $100K year 8. I wonder if this is good model to show the impact on the NOI for a potential buyer.

Another way to model how a buyer could look at their acquisition year 6 of my ownership is to use the $100K taxes at sale/purchase , even though the PILOT program would continue for 2 years therefore generating $150K in extra cash.

Looking for the input from experienced multifamily investors in Memphis, TN...

We are currently looking at a property that is under the PILOT program. 

For people who don't know it, in a few words, the PILOT program offers significant tax brakes for 10 years if the owner invest $1M in renovation. This benefit will stay with the property pending application to the HEHFB (PILOT board). [ FYI, we are not overly concerned by this application thanks to the Property Management company who has experience with this program and because closing is contingent to getting our application approved.]

How do you anticipate the impact of the end of the PILOT tax brake on a re-sale or re-fi, if a re-sale/re-fi was 2 years prior to the end of the program?

Hi Juan. I have just closed on a 80-unit multifamily in Memphis, TN this week. It is a syndication.

What size properties are you looking for? I always pay attention to the crime maps of the properties I research. Many large properties seem to be high crime magnets.

My recent acquisition is located in the Cooper-Young neighborhood, with low crime. The Frayser area has a bad reputation, meanwhile Nike opened its distribution center there 2 years ago, so it may be turning around.

Being out of state, like me, the key to the market is the property manager for most of the team members your look for.

PM me and I will share my contacts with you.

Hi BP members.

Does anyone have an idea of where I could find used income and expense reports such as the Income/Expense Analysis: Conventional Apartments (or similar) for 2015?

The most recent version are more than $500 for non-members.

Any other suggestion to find reliable data for multifamily income and expense are welcome.

What are the terms for seller financing?

Is the pre-LOI time, the time when asking these questions, the right time to ask about seller financing?

Hello BP community,

My house is paid off and I have a DTI around 25%, but little savings.

I am considering down payment on an investment property either HELOC vs. 0% credit card cash advance offer (this cash being available for 12 month, the 2-5% fees to get cash will have to be paid again each year).

Please comment about pros and cons of both (including the effect on the credit score which will affect the loan interest rate).

Thank you.

P.