All Forum Posts by: Chris Clothier

Quote from @Engelo Rumora:

Quote from @Jake Benny:

Hello everyone, 

I am looking to buy my first turnkey property, likely somewhere in the midwest. Instead of looking on Zillow, Redfin, ect.... Are there any turnkey companies/platforms that anyone has found useful to buy a single family rental property?  

-Jake

Hey mate,

These guys are the best IMO and have all stood the test of time:

REI Nation
JWB 
Spartan Invest

There are others but don't know much about them.

I have stalked the above 3 for many moons 👍

Much success

Engelo,

appreciate the mention and you stated three very good companies.  You overlooked your own company in Ohio!

Jake,

this list of 4 companies are a great starting point.  You should schedule a call with all 4 and learn what they specialize in, the markets and how they operate.  I am confident that one or two will stand out in meeting your particular needs or will feel very comfortable to you. From there, continue your conversations and don’t let procrastination slow you down.  Don’t be in a hurry either!  Let the conversations you have build your confidence and when you are ready, begin building your portfolio.   I need to rush, but definitely take the steps to learn for yourself what matters most to you and who makes you feel the most comfortable.  

Best of luck as you get started.

Chris

Quote from @Chris Seveney:

Quote from @Ian Ippolito:

Quote from @Jon P.:

Keeping this thread back on track about the original topic for those who have invested with Norada and concerned about what to do next, I think it's safe to assume your capital is gone in failed business ventures.  Sorry to be the bearer of bad news, but when you look at the facts of what money was invested in and how it was handled, it leaves little to hope for.

The only potential to get anything back is a potential SEC / FBI investigation to see if any fraud was at play where other assets of Norada is possibly garnished to pay back investors.  I also think the first ones in line with an actual lawsuit will be the the first ones in line for judgements.  That is how it works with judgements.  Literally, first come first serve, assuming you are granted a judgement, of course.  Sitting around waiting and hoping will get you no where.

Also, history seems to repeat itself.  Not sure if anyone is aware of this, but Marco's partner and CFO, Ronald Fossum, was charged with fraud by the SEC fairly recently and barred from participating in any type of similar activity.  Well, here we are again.  I think the SEC would like to know about his participation with Norada and the current situation at hand.  The most concerning piece here is that Norada is still actively raising money from their investors as if nothing is happening!  At first I looked at this as possibly just a failed investment where millions of unaccredited investors lost money (still very bad for everyone involved), but after learning about the involvement of Ronald Fossum that has a convicted history of defrauding investors and the fact that Norada is still raising money from investors, my mind now goes immediately to possible Ponzi Scheme paying past investors current funds being raised.  I can't help but think there is something more malicious here than just a bad investment by looking at the facts.  Time will tell, but for anyone invested with Norada, you are best off filing a complaint with the SEC and seeking legal guidance sooner rather than later.  Sorry to hear so many people got caught up in this mess.  Seems like tens of millions of dollars were raised from unaccredited investors...

Here are some SEC links for a partner and CFO of Norada showing previous fraud history:

https://www.sec.gov/enforcement-litigation/litigation-releas...

https://www.sec.gov/files/litigation/complaints/2017/comp240...

Jon thanks for sharing.

I was trying to find some public documentation that Ronald Folsum is the CFO of Norada (google search) but came up empty.  If he is, it seems to be kept below the radar.

And Norada website itself does not list it's principals (which is...in my opinion...another red flag when deciding whether or not to invest in a sponsor).

Is there some other way to verify his involvement?

 In one of the posts some of their marketing materials (not sure how old it is) had him listed as CFO but also noted he worked as a fractional CFO. He is not listed on the website anymore under:

Team | Norada Capital Management

 Wow! 

I'm still not going to post at length here as there is clearly more to come out, but the past few posts are interesting to me. 

I think one critical piece is being overlooked.  It is my opinion, that in order to get investors to look to the left while you are showing them on the right what the investment entails, you have to have a brand with a good reputation using their list to raise money.  If investors believed, as most emails I have received from this company going back to 2012 have made it appear, that this was a real estate company doing real estate business, then many investors may have simply let their guard down.  Many may not have known or understood what they were investing in.  They may have been looking left and preparing for a 12%, 15%, 17% return and never paid attention to the risks on the right.  Many were clearly caught off guard by the detail that their distribution could be halted and their investment converted to stock.  

I would think you have to have a very specific audience to go for this type of investment and pre-existing trust is at the top of the list.  An audience that has been built over a long period of time and with a lot of faith and belief in the personality presenting is one that is most prepared to invest without question and most likely to be attracted to the high returns.  The audience is pre-disposed to believe. 

Best of luck to you -

@David Kanarek

I see you just started posting here on the site 2 days ago and so far strictly the posts about Norada notes.  As @Jay Hinrichs noted, you are obviously an investor in the notes and emotional about the uncertainty.  However, you are talking morals and ethics with a gentleman who has successfully done business with perhaps hundreds if not more users on this site and hundreds more who have never heard of BP.  His reputation and credibility are stellar and he is beyond reproach.  His 40-plus years in real estate speaks for itself, and his unquestionable devotion to providing his expertise, advice, and thoughts here on BP have earned him a level of respect on this site that you apparently are unaware of.

He will not condemn anyone simply based off a black and white forum.  He will however be the first to counsel others to avoid anyone found to be unscrupulous after ALL of the facts come out and that usually takes time.  If you read the forums, Jay is on the opposite side of many deals with Norada investors and can personally attest to the successful transactions those investors complete.  He has a historical record with Norada whether he does business directly with them or not.  He is going to be factual while also contemplating what is happening behind the scenes without directly calling anyone out before a final resolution comes out.  

If you spend a few minutes researching Jay, I think you'll find someone you want on your side.  

Quote from @Akshay Bhaskaran:

Quote from @Chris Clothier:

Quote from @Akshay Bhaskaran:

Hello everyone,

My wife is a licensed real estate agent in Texas and she is under a brokerage. I am an Investor in RE doing single-family residences (Turnkey, and BRRR). We both are into real estate for the past couple years, and she's closed some deals for her clients. We were thinking about starting a Real Estate Consulting in a very small scale.

We are doing this already for her clients where she finds properties and deals, negotiates with the seller/builder (if new construction), and helps them get a good offer. From my part, I analyze the property's location, neighborhood growth, appreciation factor, the average rents using some paid tools, and crunch some numbers for them to let them know the CoC return, cash flow, and more etc. If they want an off-market property, I even built a BRRR calculator that they're using to feed-in the numbers from the 'B'uy all the way up to the final 'R'efinance part.

Since we are doing this already for our clients, is there a probability that we could do this officially and legally? We have an LLC registered but haven't had much activity in it, so I was always thinking of starting a small-scale Real Estate Consulting where we could offer the afore-mentioned services for a minimal fee. (Definitely not 4-digit-$$)

Need your honest thoughts and inputs on this :) 

 You will need to bring more to the table for this to be a service that investors find valuable.  What you describe is what the best agents have been doing for years.  They dive deeper into niche services by providing in-depth analysis from a high-level and experienced point of view.

I see your biggest obstacles as a lack of experience and background as investors and the perception that these are services your wife should already be offering as the licensed agent.

Given those obstacles, what differentiates your service?  What makes you special?  Why should an investor pay attention to your data or trust your analysis?  This is a very crowded space now, and what you've described is not particularly unique.  In my opinion, you need something that instantly earns someone's trust. Investors need a reason to trust you and know that you are not simply charging for something they should already expect when hiring a great agent with experience working with investors.

Thanks much for the wonderful advice. Yes, I do agree that this niche is getting crowded now and we’d need to stand out to be looked at. Thanks, appreciate it 

 Feel free to use your thread as a sounding board.  Happy to go thru what unique offerings you could bring to the table.  Bottom line is you are investing, which does give you some separation.  The question is how to position yourselves in a unique way that people value.

Best of luck - Chris

I just found this thread tonight, and I am trying to make sense of what I am reading.

I received two emails in the last few days, literally, offering a limited opportunity to invest in a new fundraising expansion capital for some new business that is part of the Norada family.  12-month secured note at 17%.  Now, I am not a sophisticated investor, but I have enough scars to know better than to respond to those emails, but they lean heavily into their brand and reputation and even have some big names right here on BP leaning into those as defenses in this thread.  I could see others jumping in, even really smart people who should know better.  

I think it's best I read the whole thread and do some more research before I comment or even if I comment further. This could be a reputation and brand killer.  

Quote from @Akshay Bhaskaran:

Hello everyone,

My wife is a licensed real estate agent in Texas and she is under a brokerage. I am an Investor in RE doing single-family residences (Turnkey, and BRRR). We both are into real estate for the past couple years, and she's closed some deals for her clients. We were thinking about starting a Real Estate Consulting in a very small scale.

We are doing this already for her clients where she finds properties and deals, negotiates with the seller/builder (if new construction), and helps them get a good offer. From my part, I analyze the property's location, neighborhood growth, appreciation factor, the average rents using some paid tools, and crunch some numbers for them to let them know the CoC return, cash flow, and more etc. If they want an off-market property, I even built a BRRR calculator that they're using to feed-in the numbers from the 'B'uy all the way up to the final 'R'efinance part.

Since we are doing this already for our clients, is there a probability that we could do this officially and legally? We have an LLC registered but haven't had much activity in it, so I was always thinking of starting a small-scale Real Estate Consulting where we could offer the afore-mentioned services for a minimal fee. (Definitely not 4-digit-$$)

Need your honest thoughts and inputs on this :) 

 You will need to bring more to the table for this to be a service that investors find valuable.  What you describe is what the best agents have been doing for years.  They dive deeper into niche services by providing in-depth analysis from a high-level and experienced point of view.

I see your biggest obstacles as a lack of experience and background as investors and the perception that these are services your wife should already be offering as the licensed agent.

Given those obstacles, what differentiates your service?  What makes you special?  Why should an investor pay attention to your data or trust your analysis?  This is a very crowded space now, and what you've described is not particularly unique.  In my opinion, you need something that instantly earns someone's trust. Investors need a reason to trust you and know that you are not simply charging for something they should already expect when hiring a great agent with experience working with investors.

Quote from @Luka Jozic:

Quote from @Jim K.:

Before the fur starts flying, can I at least make one simple statement about this situation? To live multiple states away and run a string of successful C-class long-distance BRRRRs anywhere in the Rust Belt is practically impossible. I think the OP is lucky not to have experienced catastrophic failure yet. This was taking on suicidal risk to begin with, and it's just going to get worse. I'm actuallu surprised and I'm sure there are volumes left unspoken here by the OP about how hard it must have been to make it this far. I only hope my own posts recounting what my hyperlocal experiences have been like here in Pittsburgh, the self-styled "Paris of Appalachia," do not in any way encourage people to follow the OP's lead. There's an omnipresent, ubiquitous brutality to life in general and running rental real estate in  prticular here that just doesn't translate well into metrics and data.

 Don't agree one bit with that statement and Im getting a feeling that most people in this thread are inflating the struggles I've been facing. First of all I said Im negative on most, not all. The ones Im negative on, two of them weren't even BRRRRs, I was negative because my old PM was robbing me and on the other cause I got greedy and agreed on unqualified tenants at higher than market rent that I had to evict after 3 months. The two BRRRRs that are negative is one because of the sewer (could and should have done a sewer inspection) and the other one is negative cause my old PM couldn't find a tenant for the second unit in over 3 months (my new PM filled it in 1 week and no issues ever since).

Would it have been better if I was there? Absolutely. Has my contractors and my old PM ripped me off on certain things that I can't verify due to being OOS, 100%. But thats part of the being OOS and as I gain more experience and I better team I can minimize that. I definitely don't think its gonna get worse from here I think the complete opposite. Yes I was expecting cash flow to be more stable from the beginning but I guess it takes a little bit of time. I haven't left more than 5-15K in ANY on my properties and have created a lot of equity in all of them except Toledo. And in terms of appreciation, according to Zillow data over a 8 year span, its been about the same for almost every market. 

 Luka, its hard on a 2-dimensional forum to get the full tone, but I think most if not all of the posters on here root for each other no matter what advice is followed.  Again, I think from your posts that you are well ahead of many OOS investors actively building their portfolios who post on here.  That is not a knock on anyone else; it is just a nod to you.  

One suggestion for you.  Use the messaging on here.  If you are getting feedback from this group of posters, many of which are legendary by BP standards and known for their knowledge and willingness to share it.  Reach out using the message system if you have any direct questions or want additional advice.  Not that it will be significantly different from what's on here, but you may be able to get more granular advice.  And again, you'll get advice from posters that could not care less whether you follow it to the "T".  We just love seeing other investors reach their expectations and definitions for success.

Quote from @Engelo Rumora:

Quote from @Jay Hinrichs:

Quote from @Engelo Rumora:

Quote from @Jay Hinrichs:

Quote from @Ryan Arth:

Quote from @Chris Clothier:

Quote from @Ryan Arth:

You’re right. Keep your focus on how many crappy properties you can buy each year, instead of buying fewer but better properties. Focus on “scaling quickly.” Collect properties instead of money. It’s a winning strategy…..

Way back when BP started, before we used our real names, a prominent guy on here named Mike in OH said "focus on your ROI, not your door count". You are investing for return on capital.

Someone had congratulated him for how many doors he had in Cbus and he pointed out that he was collecting rents in cash with a pistol and his day to day was anything but fun. 

 I am always on the look out for users who have been on the site longer than me.  I haven't found many still around.  I'm not sure there are any with joined dates older than yours still on the site!  The site has changed tremendously.  Glad to see there are still some original voices on here.

 Why thank you Sir. I originally found BP to help myself nagivate the waters of RE. Now I am here to help others, though I do still learn daily. 

I remember studying your business model early on through your posts and early podcast episodes. We also met at the speaker's dinner at J. Martin's RE Summit in Oakland in ~2018. If I remember you left your family in Vegas at a birthday celebration to come speak. Now that is service! Cheers to you.

I was at that J Martin event I miss his events  fun guy.

Lori and you picked me up in the Tesla and we almost ran over a homeless guy in Oakland hahaha

I had forgotten that part.. I remember though you and I talking with Chris.. he invited me to visit his office in memphis which I did later in the year.. Boy his staff was first class all the way.

Not me mate,

F@$# it tho.

I'll just show up one day and knock on his door haha

Teach him how to play football and not how you Yankee's call it "soccer" hahaha

 My fault, I thought you knew the invitation was open!  You're always welcome to visit. It's the best way for us to grow as companies by sharing what works and what doesn't.  I've been expanding my business investments and interests.  If you make it to Memphis, we invest pretty heavily in the youth club game down here and our non-profit, Cancer Kickers Soccer Club, is the first non-profit to be on the jersey of a professional soccer team, 901 FC of the USL.  We'll go check out the operations.  Soccer is an awesome sport and great teacher for kids.