All Forum Posts by: Shane Crockett

I'm under contract on a $2M STR investment property with great rent performance, above 1.25 DCSR, and room for growth, but my investors are $50-75k/ea on a $500k raise so there's going to be 7 of us and lenders don't like it. I can't really trim my investor count down to the lender desired < 4, and I'm not sure getting the investors to form a separate LLC just to pool the capital is going to fly either.

Any creative strategies or best practices in this type of situation? Or anyone know a more flexible lender who looks at the DCSR and performance metrics more than number of investors in the LLC?

Traditional lenders wont use this approach, so perhaps I need to update my question so that it's framed in the appropriate context.

I want to find investors, not traditional lenders, not banks, etc, but investors with a more innovative approach looking for high performing STR opportunities to scoop up. P/E money bought Airdna, Alternative Asset Management Company bought AvantStay, and there is a growing number of wall street investors looking to park more money into the growing asset class of high performing STRs.

The problem as I see it, is those investors want to buy high performing STRs, and I am great at finding them to wholesale, so there's a need to be met if only I knew them and they knew me :)

There are several companies out there who BRRRR single family dwellings into high performing STRs, then package multiple together and sell to investors based on NOI and CAP. I understand this does not happen in the consumer world, it's definitely happening in the institutional spaces which would undermine your "never" assumption.

 Hi Sarah, thanks for the recommendation.  How would I get in touch with Christopher?

This is why STRs are a great investment class - the world is going to **** and individual mental health depends on more time spent away from cell phones, computer screens, and television sets. No surprise P/E and Hedge Funds and others have already identified the growth in STRs and started pouring money into the space, namely through tech firms, data firms, and STR management companies, but the portfolios of STR rental assets is growing too!

And yes, Bitcoin FTW!

Less people are looking right now so they seem to be popping up more and more :) I also use a somewhat different analysis model to determine how suppressed NOI might be from subpar PM performance or exorbitant PM cost structure(s).

Let's chat more if you're interested, I'm always eager to meet more people in this space.

I should have also indicated - the property in question is the classic example which totes that line of residential/commercial, ie, a 4-plex. It's technically residential and qualifies for resi loan products, but the valuation math and other KPIs involved are always the standard found in CRE; NOI, CAP, GRM, etc.

Some Banks will offer CRE loans for 4-plexes, some will not. Some investors will buy based on NOI and CAP, others will not. So I am wondering if there are more concrete guidelines within the RE and/or investor communities around this, or if it's still simply a nuanced topic which depends entirely on who you're talking to.

Are there hard and fast rules around valuation math for STRs? Some like standard NOI and CAP, others believe it's a hybrid approach which also requires comps, others believe it's still just comps (which I personally dont agree with).

But regardless what I believe or have heard, I am curious what the community is seeing or hearing about how to value STRs, what investors are looking for from an STR perspective, formuals used, etc. Are single family STRs valued using NOI and CAP, or does it need to be a MF STR? Are investors looking for individual STRs of either flavor, or is the appetite for larger portfolios of multiple STR assets? I am eager to understand the perspective of others with more experience in this space, so anything is helpful and appreciated!

I am amazing with numbers and would love to see what your investors are looking for in Florida. My sweet spot is vacation rentals and assessing highest and best performance in various markets, looking at NOI vs CAP, evaluating acquisition, expenses, exit strategy, and modelling for various scenarios with a near infinite number of levers we can tweak to account for any nuance in any variable.

While I am here in Washington State, I have done pro forma modelling and REI analysis in various markets across the country, and would be happy to look at your ideal investment profile to see if it's something I might be able to help with.