All Forum Posts by: Robert Rixer

Unfortunately I consider myself somewhat of an expert/victim in this area. I've tried locks, cages, cameras. Nothing will cure it 100% as many of the offenders will just leave trash next to the dumpster as others have pointed out. These people just don't care.

Best success I've had is shifting the location of the dumpster to be out of sight as possible. Not possible with all properties and of course it still has to be accessible for collection.

Ignore list price, offer what you would pay for it. Worst case your offer gets rejected and you've lost nothing. Many sellers asking ridiculously high prices to see who will bite. If your offer is fixed to a list price you're going to overpay. I've seen an offer in the past week alone for 50% of list price so 10-15% below is nothing. A building is worth what the market is willing to pay for it - you are the market.

Yes to increasing rents, value-add and appreciating markets as others have mentioned. But most of all I've seen a lot of buyers purchasing on the speculation that interest rates will come down in 2024 (as the Fed have suggested). Paying 6% interest today on a 5% cap property can make sense if you think rates will be back in the 3's and 4's in 6 months.

This is a tough one, would definitely recommend to consult an attorney. As for HOA's in general, the risks are you don't have controlling vote with 40 out of 220. Special assessments are always a risk especially with owning a large number of units. My experience with HOA's is that most of them are largely inefficient in controlling expenses and managing capex.

I would only touch condos if you were getting an absolute screamer of a deal - versus buying an entire multifamily building.

I'm no lender but from my experience scaling as an investor, the lower the purchase price/number of units, the more emphasis is put on the income of the borrower. As you start to make more and larger acquisitions, more emphasis is put on the property financials and your experience as an operator. The catch is the lenders typically won't let you go from a 4-unit to a 100-unit, so you have to build up gradually.

The situation sounds like a planned re-trade. Win the bid by coming in high then figure out a way to get the price reduced..

Stay away from these mentorship programs!

@Justin Goodin Unpopular opinion if you're an LP. Popular opinion if you're a GP.

Key part to look out for as an LP is the amount the sponsor is contributing which could be skewed by the Acquisition Fee. Say the sponsor says they're putting up 10% of the total $25M total raise to buy a $100M property. The Acquisition Fee is 2.5%, not on the equity raised, but on the $100M purchase price.. abracadabra the sponsor controls a $100M property with effectively no money in. Nothing wrong with that, as long as LP's are aware..

Best bet is to talk to an experienced finance broker. They've probably been exposed to every type of financing term under the sun and can point you in the right direction. A question I would have for you is why you'd want to lock yourself into a long-term fixed rate right now?

I would say it depends on how much that return is from income versus exit. If it's mostly income and the inputs are reasonable then I would feel a lot more comfortable with that than having most of the upside realized upon exit. No one knows what values will be like later this year let alone 5 years from now.