Thank for your response.
I understand it is a little different than usual. MY goal is to minimize the conversations/hassles with the investor.
For me an investment should be hassle free and with the Master Lease I control the property. I can guarantee the investor a fixed amount for the entire year. They get a good return and know exactly what the investment will return that year.....it is no touch no work for them. The advantage for me is that I will have that property for a year and with only one person in charge of the decision making process I can improve the investment and return. It makes it easier for me to keep the properties full and reduce the headaches for the investor and my staff.
The reason I do not utilize the purchase option is that I don't really want the property and most investors wont enter in to that type of arrangement. It becomes to litigious.
I like to take on properties and keep them. The more I have the easier it gets. When you us the current PM way most multi-family C & D properties under preform and are a management nightmare. The investor suffers because the property is never full and constant maintenance costs evictions fees...etc; associated with the turnover. Sometimes the PM company is making money by the constant turnover, but I do not like that business model.
The one I am doing now the investor will make more money than last year. I will beat my PM management percentage and not have any run ins or negative issues with the investor. The investor will get a guaranteed monthly amount.
For me treating the investor like I would like to be treated and offering a solution that works for both is my goal. For the properties that I specialize in this is a way to set me apart from other PM's and keep properties long term.
This may not be for everyone but if you have had the experience of being an investor held hostage by the PM company's and your "challenged" property in under preforming this is an option.
