All Forum Posts by: Roy Marks

Hey @Joshua Doherty, did you ever find recommendations in CT and/or go ahead with a purchase? I've recently received quotes from Reconstruction LLC as well as RT Contracting, and would love to know if anyone has worked with them!

Great breakout @Tyler Cote, will keep this in mind! This is exactly the type of calculation I'm doing at the moment.

Thanks @James McCard, great advice! I do have an attorney that I'm working with already, but appreciate the recommendation. Thanks also for the tips regarding how to engage with potential cash buyers. 

Thanks @Ryan Allison!

Thanks @Ryan Allison! Great tips here, especially re: hiring an independent appraiser. Are appraisers fairly well-versed in as-is properties that require reno? Also, should I get an inspection report as well as contractor quotes *before* hiring an appraiser?

Thanks @William Collins and happy to communicate with you about this, please send me a message. 

For the forum posts, I'm hoping to receive some advice and tips to prepare for the sale, so that other potential as-is sellers can learn from the experience I'm going through. Thanks again!

Hi @Karen Margrave,

Thanks for your message - lots of good advice here! 

Hi everyone,

My parents have owned a 3bd/1ba investment property in West Hartford, CT for 20 years. The property has been rented for nearly this entire time.

The house has a good amount of deferred maintenance, is not updated, and has some water damage which we only recently (two weeks ago) became aware of. We have since gotten estimates from contractors. All in all, the property will likely require north of $50k in repairs/updates to be put into a market-ready condition. 

Since my family and I all live in CA, we are not sure this project is something we want to take on.

The house is in a great location in a "hot" market in CT (West Hartford). 

What is the best way for me to prepare for selling the house "as-is"? My questions are:

1. How can I find cash only, no contingency buyers? Are there online marketplaces/platforms or investment groups that I can reach out to?

2. Do I need to work with a real estate agent? A lawyer?

3. What do I need to do to ensure that we disclose all necessary information (i.e. re: repairs required, damages, that we are aware of) to buyers?

4. The house has some evident water damage. What do we need to do to ensure we are not liable for damage that a buyer might uncover later, that we are currently not aware of?

5. Any tips for how I can get the best price possible? For example, the exterior house could use a good power washing, and also needs a new roof. Are these things that are worth addressing before listing "as-is", or will fix-and-flipper really not care for these things? 

6. Suppose I had a cash buyer ready to go. What is the step-by-step for how to develop and finalize the transaction? Who else needs to be involved?

7. How do I determine the price I should list the house at? 

If you are an investor that is interested in learning more about this property, please do not reply here in the forum, send me a message. 

Thanks for all of your help!

Hi California investors,

Asking for a friend who is looking into multi-family investing in the Greater LA area and wanted to get a few quick data points from the community! 

- For a multifamily property in the ~$1m range, would you advise having two LLCs in place? For example, a PropCo (Asset Company vehicle which owns the property and the debt), and an OpCo (operating company, which operates and manages the property)? Alternatively, is it sufficient to have only one LLC in place? What are the pros/cons of each approach?

- What are benchmark figures for the cost of legal formation for the two entities? Received one quote at $6k, and curious to know if this is in the ball park for an OpCo/PropCo set up. 

- Any idea of ongoing annual legal costs for management of the OpCo and PropCo? I'd imagine that there would be management services agreement between the two entities, and wondering what sort of issues could pop on an annual basis that could/would require additional legal support. (I don't imagine many, to be honest...)

- Similarly, grateful to receive any benchmark costs on having 3rd party accounting/books for the two entities?

- Would you advise incorporating in CA (the property would be in CA, so a foreign LLC would likely still be subject to CA's $800 franchise fee) or are there benefits to incorporating in another state (WY, Delaware)?

- At the moment looking at only one deal, but would love to continue to invest in the future. Are there any implications to be considered, particularly for the OpCo? I'm wondering if for future deals, a subsidiary PropCo could be created for each property, keeping one OpCo in place. If the different properties would have different financial/equity partners, how do we account for this in the OpCo? Would those partners only be involved as shareholders in their respective PropCos?

Thanks in advance for your thoughts as always!

Best,

Roy

@Jesse Daconta Awesome - many thanks for this. And yes, fully appreciate that this model works well on large complexes where the funding volumes are large and experienced lenders can earn a quick and attractive fee on their capital/balance sheet (with a de-risked development team). 

Totally got it on Options 1 and 2. Will consider this further! Again, great to have that 3-5% data point as a lender fee.