All Forum Posts by: Siraj Alsafar

Hey there, I'm a Florida commerical real estate agent and have been officially working in real estate for a few years now.

I worked in property management for a bit when I was barely 16.

Many investors and institutions are flocking to Florida. Floridian's are paying more for rent than ever and their income hasn't risen to match it. Florida ranks #1 currently for unaffordability because of hundreds of thousands or millions of people moving here every year.

I have always wanted to own commercial real estate.  I want to avoid starting with duplex's, triplexes, etc because they are appraised and valued using a comparable sales approach like your home is.

When you buy a 30 unit apartment building as I would like to, the value of the property is more based on the income and the performance of the property which gives you an opportunity to create value and scale.

I have recently identified numerous properties I'm interested in but I'd like to focus on one and then consider scaling afterwards.

So here's my deal:

30 unit apartment building

100% occupied with 3-4 STR units currently.

13% cap rate CURRENT

Downtown Juneau, the capital of AK.

Stabilized but could use some light value add such as the common areas. 

Appraised 2.4m+

Sale price will be 2.1m

291k NOI

14 studios, 14 1 bedroom, 1 3 bedroom- 2b , 1 2 bedroom 2 bath. For a total of 30 units.

oceanviews, + mountain views

New electrical and fire systems.

roof coated 5yrs ago

new broiler tank for common areas.

My plan: implement RUBS+ (27k annually), optimize STR occupancy by adding simple amenities. This is already an amazing cash on cash return and I'd love to own it out right but my fiancee and I only have 10% to put down.

I've tried my network but no one else is willing to consider out of state. I would be the one who flies to the property and I'd also move to a closer state to be able to keep a closer eye on it.. I would make available the Short Term Rental units to our investors if we had any so they could inspect the property without having to pay hefty hotel expenses.

The city boasts a diverse job market, and this is a high cap property without being in the hood. It's an amazing downtown location just hundreds of feet from the governor's mansion and within walking distance to the grocery store, one of a kind parks, whale watching and the ocean.

So the question is how do I find, and connect with other investors who would want to do this deal for the cash flow? I want to refinance after buying so we can pay off the investors or they can stay in the deal.

I've been searching for months and I can't find anyone that I'm connected to who can help. The ideal investors who have to do a 1031 or have some extra cash on hand. We need 420k+ closing costs and as I said we have about 10% or 210k of the down payment from my fiancee's father passing.

How do I attract investors from other states who will trust me and a property management company to run the property?

With a normal down payment and current interest rates, after all expenses I'm expecting to currently cash flow about 10k a month net before doing any splits for anyone else who would join us.

I love the numbers on this deal but how do I find others to join me, as I have other buildings I want to acquire after this one is successfully completed and familiar to us.

The seller isn't willing to discount, or give any types of seller or creative financing for this or the others..

I must have this, what do I do? 

Quote from @John Peter:

I just moved 460k into an account with 4.75 % interest. It will provide over $2k a month of income, risk free until I decide what to do with the cash. For the past year, I had been looking to invest in multi families somewhere around Tampa area. After factoring in the insurance nonsense, skyrocketing taxes and double digit increases in utilities and I'd be lucky to cash flow a couple of hundred a door. That's IF nothing needs maintenance or repair. So, my question to you more seasoned investors is.. when you can park your cash in a CD or high yield savings at 5.5%, why bother taking the risk, especially in Florida? Any ideas that I'm not considering?

Hey John, Dan & Travis have all brought up great points.

I would also like to note there are multiple news headlines stating Florida has the highest Rent to income rations in the nation. Prices keep going up here and income has not risen to match. That being said there's always some kind of deal.

As a licensed R.E. agent in Florida, I personally prefer stablized but high cashflow properties in amazing locations, I have located out of state deals and I have 10% currently, I'm working to secure the other 10%. I am working on doing an acquisition of a 2.1m 30 unit multifamily building, it's appraised for 2.4m, is hundreds of feet away from the state's governor mansion and has an in place cap rate of 13%-14% with room to grow. It should net after financing and all expenses more than 110k. It's roughly CoC 30% +/- as there are a few STR units with an ADR of 180-200+.

Different people want different things :)

Quote from @Carlos Handler:

Quote from @Tim Ryan:

Sell em all and get those funds working for you out-of-state in a growth market.  With those funds you should be in multifamily no single homes.  With those funds you should be Cash Rich from all the positive cash flow.  Sell. You've made your money here. Time to Level Up! 

thank you to everybody! This is all really good advice and information I never would’ve thought of. I would love to take some money and go out of state. I just wouldn’t know what markets are good in multifamily and are growing. I guess what I probably need as a mentor because the more I think about it, the more inexperienced I am, in all this. BiggerPockets, is a great in Community.

I sent you a request to connect! We should talk! I have some ideas and some stuff I'm involved in and we can discuss and compare.

For someone who supposedly doesn't know a lot, you're doing great!

I'd love to chat, keep it up!

Quote from @Scott Hanson:

I have multiple properties in the Los Angeles area that are being sold, and we are looking for new markets to 1031 exchange into. In the past our model was largely built around property appreciation. However, with this change we would like to reoptimize the portfolio for cash flowing properties, and are not particularly concerned with appreciation. We also have two other investors/portfolios who are looking to do the same thing. Looking for advice and real estate professionals to meet and potentially work with. 

Hi! I love that you're doing this! I'm a licensed FL RE agent looking to do the same thing. I've already identified some markets, have visited most of them and I intend on visiting the others as soon as I have the capital to do the deal there.

I have the same vision for my portfolio of stabilized, high cash-flow, Multifamily 20-30+ Units comprised of mostly long term tenants in HIGH rental demand areas. We will also purchase in ecotourism locations so we will most likely have a few Short Term Rental units. These markets which have thrived for hundreds of years are ignored by traditional investors and institutions that want to buy in LA & Miami but ignore that rental prices are at all time highs while income has not grown to match it which creates an unprecedented risk.
  Some of these markets are not only more stable than the traditional markets, but they are also priced way better. 

Currently, I want to buy a 2.1m Apartment building which is in the downtown capital of a state right now. It's appraised for higher than 2.4m and it currently has an in place, not proforma 13%+ cap rate with room to grow.

A couple different notes: We find highly stabilized properties where rentals are in high demand, we can implement RUBS or a flat rate utility bill back for common areas and utilities provided to the tenants. In most cases this can easily add at least 20,000 a year to the bottom line where as before it was simply an expense.

The STR units not only serve to push the cap rate even higher, but are nicely blended with long term leases for the remaining units which not only dramatically reduces the risk but increases cashflow. Most importantly though, it also gives an opportunity for our potential and actual investors to not only profit from their investment but it turns annual inspections into vacation rental for the family.

These locations are all over, the Pacific North-West, AK, MT, WA, ID, and so many other states not only just on the west coast.

We acquire these properties under the appraised value and significantly under the cost of replacement on average the Multifamily and mixed use buildings I'm looking at acquiring if I have the capital are between $100-$150 a square foot.

I would love to connect and discuss all options whether we want to work together or just have a pleasant conversation!

Quote from @William Blaker:

What are the top recommendations of building my portfolio as I cant continue to put 20% down on every property moving forward? I'm not clear on how folks are building their portfolios relatively quickly in many cases. Any information would be a huge help. 

Warm regards

Well that's a great question and I'll it depends on what you're buying. If you're buying smaller multifamily that isn't considered commerical then consider doing some work that will make the property appraise as high as other comparable sales in the area.

If you're doing retail, or commercial multifamily or anything else fill those vacancies and maximum the NOI.

Long story short you want to know how to get the best fixed rate refinance you can and preferably buy value add deals so you can pull more cash out to scale.

If you buy stabilized assets it's nice, but it's also harder to scale.

Find value add, add value, refinance, repeat.

Feel free to connect if you would like to discuss

Hey there, my team and I have the exclusive right to sell an entire project. It's probably one of the largest beach and oceanfront developments. 

We are preselling the units for about $850 a sq ft, where as comparable properties are selling between 1,500-4,500 a sq ft. 

This is resort-style living, which will mainly be used as second residences as well as Short Term Rentals like Airbnb/VRBO. On-site will also be the largest marina in the state of Florida with over 1,000 slips wet/dry.

We own the 181 acres of beach and oceanfront views with Gulf of Mexico access and stunning boating destinations nearby. 

We have about 11 days to sell another 90 units in bulk, preferably in sets of ten. We have multifamily, and various sized SFH for sale.

My question is who, and what companies would you target to purchase these units that can be used for STR?

I don't mind making some calls, and we have some meetings booked but I'd like to have more leads in the pipeline. Buyers just need to put a 10k deposit for each unit. 

So how would you sell these units? We will have a marketing budget in the next few months but at this time we don't have one.

I'm not advertising, I am genuinely asking for advice and ideas to help me locate groups, companies and individuals that love to purchase units for STR.
 

So, how would you pre-sale these units if you had to? Do you know what entities purchase STR units in bulk? The community will be managed by a large professional third party to ensure a consistent experience. It's not a condo-hotel sale but the way the units can be enrolled into the rental program is very similar, if you enroll your unit, the management takes a cut, pays almost all of the bills and then sends you the remainder. They handle the everyday business and buyers of the units can keep them for themselves or choose to enroll in the rental program.

How would you sell these units in bulk if it was up to you? I'm open to all ideas and I love learning that's why I always return to Bigger Pockets.

Depends on what you're buying I'd say. If it's a home then get pre-qualified. If you want to buy commercial real estate where you can force appreciation it's more asset based so you should figure out a market/plan.

Depends on what you want to do, how much you have to use and what you're targeting,

Quote from @Eric M.:

Greetings all,

Thanks to years of savings and capital gains from the stock market, I have a little over 1 million to invest. I understand the market conditions today aren't as ideal as they were a few years ago, but I am looking for opinions and ideas on how to best leverage this cash to build and grow our venture into real estate.

Our location is South Florida, and would like to stay local (or at least within the surrounding area/states) ideally. We are open to STRs and LTRs alike. Any ideas are welcome. 

Hello and welcome to BP! I am a S FL CRE agent based out of Fort Lauderdale. I would suggest that you find properties that you can do some owner financing on.

Feel free to connect with me if you need assistance.

Connect with me and send me what you have.

Quote from @Abdul Hafeez Jamali:

what is current interest rate and LTV ratio for a foreign national investor in South Florida?

Hello, Salam and welcome to Florida. Let me know if you need any help, feel free to connect.