All Forum Posts by: Ryan Prichard

Investment Info:

Single-family residence other investment.

Purchase price: $550,000
Cash invested: $300,000
Sale price: $1,300,000

We're building a new land development for future residential home sales.

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

Looking to build new inventory and business for our sales team.

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

My builder reached out to sell a project to me.

How did you finance this deal?

Commerical development loan.

How did you add value to the deal?

CMA of land sales in the area. Then accounted for all budged items to build the development and future sales prices.

What was the outcome?

Listings will go live this month.

Lessons learned? Challenges?

Learned to price a development, to work with engineers and time management of a project of this scale. I've encountered delays I'll be more ready for next time.

Investment Info:

Small multi-family (2-4 units) commercial investment investment.

Purchase price: $1,350,000
Cash invested: $80,000
Sale price: $1,570,200

We purchased 16 units and sold 14 to hold two cash-free. The mix was one 4-unit, two 3-units, the remaining were a mix of SFH and Duplexes. The cash flow allowed for all the rentals to make their own repairs before resale. Increased rents for resale.
After the sale, we held two Single Family Homes now valued at $360,000 that bring in gross rents of $2,790 and tenants pay all their own utilities. This allowed me to go under contract for a 26-unit 5-building purchase.

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

Wanted to know if I could do it and be creative. I thought we were going to experience large appreciation.

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

MLS and I was the agent.

How did you finance this deal?

Land contract and then a refinance into a commercial blanket mortgage.
The seller agreed to an aggressive land contract with a minimal downpayment.

How did you add value to the deal?

Appreciation and repairs to units after tenants moved out. We bumped all rents up nearly to market-rate by sale.

What was the outcome?

For what we sold we had a 16% gain. Overall if we kept them we would have seen a near 42% value increase.

Lessons learned? Challenges?

I find I like a larger complex and more tenants vs the residential purchase. I've moved into complexes and portfolios with at least 20 units.

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

I was the agent. And I used a local credit union.

Investment Info:

Small multi-family (2-4 units) commercial investment investment.

Purchase price: $1,350,000
Cash invested: $80,000
Sale price: $1,570,200

We purchased 16 units and sold 14 to hold two cash-free. The mix was one 4-unit, two 3-units, the remaining were a mix of SFH and Duplexes. The seller agreed to an aggressive land contract with a minimal downpayment. We converted the Land Contract to a commercial mortgage via refinancing after having ownership. The cash flow allowed for all the rentals to make their own repairs before resale.

After the sale, we held two Single Family Homes now valued at $360,000 that bring in gross rents $2,790 and tenants pay all their own utilities.

This allowed me to go under contract for a 26 unit 5 building purchase.

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

Wanted to know if I could do it and be creative. I thought we were going to experience large appreciation.

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

MLS and I was the agent.

How did you finance this deal?

Land contract and then a refinance into a commercial blanket mortgage.

How did you add value to the deal?

Appreciation and repairs to units after tenants moved out. We bumped all rents up nearly to market-rate by sale.

What was the outcome?

For what we sold we had a 16% gain. Overall if we kept them we would have seen a near 42% value increase.

Lessons learned? Challenges?

I find I like a larger complex and more tenants vs the residential purchase. I've moved into complexes and portfolios with at least 20 units.

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

I was the agent. And I used a local credit union.

BP Fam, please overwhelm me with your inputs. I'm looking to use my SOI, our 100+ agents in the office, lender network, and their connections to fundraise an upcoming purchase. 

Our team is fundraising either a full $4.8 million for a 63 unit purchase or fundraising a 25% down payment to work with our capital lender. I'm working with my attorney and CPA to draft our operating agreement and payment structure. We want the BP Fam input on your experience when you scaled to this level. 

(1) What do you wish you had added to your syndication partnerships? I've primarily focused on portfolio purchases of 1-4 units and paid out monthly with property management. 

(2) How have you split earnings per investor for different % of ownership? 

(3) What reserve would you recommend?

(4) Recommended software for bookkeeping 

(5) How have you managed purchases? Do owners have voting rights or does the operating manager get a full say? 

(6) Other experience, please post for input/ contributions. 

Fun notes about our purchase:

The property is currently mixed with student housing and long-term tenants. The value add is converting the buildings using per-bed leases to all long-term tenants. There is room to increase rent between $110-$250 depending on the unit. The current net monthly cash flow is $9,679 and aims to be $22,956. In this area, it should add nearly $1,500,000 in equity.

All units are fully renovated and fully furnished. We have a lender that can give us a 12-month interest-only bridge loan. After that, it can be converted to a 30 year fixed rate option. 

During school, season occupancy is nearly 96% and plummets into 80%'s in the summer season. Our research shows it's a pipeline issue with management and not necessary as there are renters available to take full-year leases.

Thank you Andrew! I appreciate the comment. 

Correct simply put. Fannie Mae has the mortgage. New buyer would take on the same mortgage Buyer is an assumptor. The seller is assumptee. Assumptor takes on same loans terms.

Current Rent Roll: $1.534 million 

7 vacant units / 94.6% Rented. 

Note: $7.7 mill @ 4.19% 30 yr am @ balloon date 10/31/2026

-Units are located in the best parts of Greater Grand Rapids. And conservatively under $100-$200 market rent. I estimate additional revenue could be made of $200,000. And my property management could reduce costs near $100,000. 

Hey BP Nation.

I'm looking to purchase into this asset class and need help landing the remaining $4.3 mil of a $12 million deal. $7.7 million is required to be an assumed mortgage or seller cannot sell. (They can but adds a $1.2 million pre-payment penalty from lender). I'm looking to Bigger Pockets for suggestions on how to secure the remaining amount. I'm an avid listen to BP podcast. I send requests into hard money lenders. What else do you suggest? Do I pull in partners (I have a few) or seek private money? 

All help is appreciated!

-Ryan

@Kaylee Walterbach, the times have been so very fortunate since then. My first home purchase was in 2013 with my brother. I was 22 and he was 24. We bought a slab house in our home town for $101,000 they paid $2,500 in FHA concessions. Since then that home has doubled in price! We used a part time agent, family friend, and I was personal banker at the time. No one educated me on the time value of money of a home and it's appreciation ability. Things were still scary back then. If I had known then what I know now. I would have (1) gotten my license sooner and (2) bought every house in that market. Greater Grand Rapids, Michigan, is beyond thriving in a sellers market.

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $138,000
Cash invested: $34,500

My business partner and I wanted to be able to build passive income and have something in 5-10 years that can give him and I each $60,000 a year. We valued this property in GGR for good rent, ability to increase rents, renovate, resell higher, and high market appreciation rates.

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

Looking to build wealth outside of 401(K). Looking to get my business name made and cash flowing properties. Knowing many lenders are wanting 2+ years to lend to business name only.

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

MLS. It went under contract, fell through for a bad roof, seller replaced the roof, and relisted same price. We came in and offered lower and them paying closing costs. Then negotiated seller making repairs when under contract.

How did you finance this deal?

25% Conventional RE Loan. Northpointe Bank

How did you add value to the deal?

Capitalization rate and insuring it cash flowed each month. Including the use of a property manager. Reviewed all lease agreements and rent roll.

What was the outcome?

Cash flowing property. Have done zero repairs and now appreciate close to $170,000. If we renovate it and replace tenants (or not) could sell for $220,000.

Lessons learned? Challenges?

Was my first multi-family purchase everything was learning. Had done plenty of single-family deals. Since this deal, I have been able to lock in 8 more homes for clients and myself. And have a bench of three buyers looking at multi-family now.