All Forum Posts by: Sean Myers

Let's keep 2019 rolling as we take a deep dive into a $10 million apartment deal and value-add reposition that's currently in progress!

Free Event Meetup Registration

Join Andrew Steel, CFO/CIO of Northshore Development at our 8th Multifamily Investing Meetup.

Andrew will present his company's strategy and approach to acquire, renovate and reposition a 192-unit apartment complex. They are targeting upward of $200 per door rent increases after rehab -- and a 22% IRR over the hold period.

Mr. Steel has 15 years of experience managing and negotiating complex transactions in the hospitality, office and residential real estate sectors. He has participated in over $5 billion of successful real estate transactions and a strong financial expertise background. Mr. Steel has worked with the top-tier of real estate development teams throughout his career including Margaritaville Holdings, The Related Group and The Carlton Group.

Please join us. Make sure to RSVP for this session.

RSVP Here

Also, can you help our Meetup in two simple, easy ways?

1. Invite a friend to come with you.
2. Share our event on social media.

AGENDA:

7:00PM to 7:30PM - Open Reception and Meet & Greet members
7:30PM to 8:30PM - Meetup Discussion -

A) Presentation of Mission Grove Apartment Reposition
B) Open for Q & A and Discussion.

8:30PM to 9:00PM - "Live" Deal Group Review and Networking

PS: Have a deal you are working? Need some help? If you'd like the group to review your potential investment, then please contact the meeting organizer. If you're selected for the "Live" Deal, then bring the details and we'll work through it together.

Please contact us if you have a specific topic you would like to address to the group or have any other questions. See you there!

Happy Holidays!!! Our 6th Multifamily Investing Meetup is designed to provide you with the tools to start a Regulation Crowdfunding (Reg CF) capital raise online.

RSVP on Meetup

Under the rules of Reg CF (Title III of the 2012 JOBS Act) eligible companies have been allowed to raise capital using Regulation Crowdfunding since May 16, 2016.

Investors have already funded $70,117,879 in Reg CF offerings from the May 16, 2016 to December 4, 2018.

Did you know your company may be able to issue securities in amounts from $50,000 up to $1,070,000 using a registered online Reg CF Platform?

Companies listed on the largest Reg CF platform raised $763,943 in the the last week alone!

Make sure to RSVP for this session. RSVP on Meetup

PLEASE NOTE THIS MEETUP IS ON A WEDNESDAY NIGHT -- NOT ON A TUESDAY LIKE ALL OF OUR PAST MEETUPS.

Hi @Don Spafford and the rest of the Bigger Pockets community. 

We're going to broadcast video of this Jason Schaller's presentation on Value-add apartment designs using Facebook Live. 

Request to join our FB group & we can notify you when the video starts:

https://www.facebook.com/groups/multifamily.invest...

(I think it will also be uploaded to the page, so you can watch it after the event, too.)

Thanks @Brian Burke. The deal is working for us at our original numbers, so I'm inclined to follow your advice and not to make any adjustments upwards.

And I agree, two leases does not make prove a market. 

We're keeping LTV low, taking more term on our debt than we anticipate needing, and have a plan that focuses on bringing the old leases more in line with the current average rates.

We also run Downside scenarios to see what the numbers look like if we're wrong about room to increase or (worse) the market changes and results in vacancy going up and rates going down.

Those are not pretty of course, but a large part of winning is being able to stay in the game.

https://docs.google.com/document/d/1-3rYb2SpPwyWbOahzQWqWU-ayktwRXrTA7tphLr55Kg

@Jonathan Hulen you should be very selective at this point, but I don‘t think you should ever decide to ”sit it out” and wait for a crash or correction. Yes, you will find and do fewer (or no?) deals when you implement a more stringent criteria. But you should always be actively looking. Exercise patience and discipline. This Google doc (courtesy of Garrett White) outlines some prudent strategies to consider: https://docs.google.com/document/d/1-3rYb2SpPwyWbOahzQWqWU-ayktwRXrTA7tphLr55Kg HAPPY HUNTING!

Should I update projections because two new lease exceeded our baseline? Even a little bit?

On Friday I received an update on 2 new leases for a property we're closing on soon. Our group is the contract purchaser and we're wrapping up due diligence in a week.

Earlier in the inspection process, we requested the Seller and Property Manager ask for rents at our Upside “rates” rather than our Base Case "market rates" on two units that are turning over. (Note: these are move-out, so not existing tenants that are renewing a prior lease.)

Results:

• Unit Type #1 went for list at $775 and the new residents moved in yesterday. The scheduled lease rates (rent roll) for these unit averages $697.
• Unit Type #2  was listed later in the week. It had several apps at the list of $925. PM is processing one of the tenant files right now at $925. The currently scheduled lease rates for these unit averages $814/month.

Comparing existing leases rates to our “Base Case Scenario” you can see how much the new lease rates are exceeding our baseline projections AND the average currently scheduled rents:

• 2/1 New Lease +$78/month                Our Base Case is +$53/month
• 2/2.5 New Lease +111/month             Our Base Case is +$71/month

I don't want to post the actual rent roll on here, but I can tell you that just from the wide spread in lease rates among unit of the same type that this property is carrying a big loss-to-lease.

So what do you think? After all, these two leases only make up 5% of the existing units.

Should I edge up my base case numbers a bit and redo my projections - or hold tight with my original numbers?

So great to read stories like this . . . congrats on learning how to do it and then setting out to get it done. As you said, "persistence, patience, and planning"

Hey BP'ers -- I have a quick update on 2 new leases & the rent rolls these 38 units we're closing on soon.

Early last week we requested the Current Owner and Property Manager ask for rents at the two units that were turning over new leases at our Upside “market rates” rather than our Base Case or the PM’s lower “market rates.”

Result:

Unit 114-5 (a 2bed/1bath - 910 sq ft) at went for $775 and the new resident moved in yesterday. The average current scheduled lease rates for these unit are only $697/month.

Unit 2935 (a 2bed/2.5bath - 1,100 sq ft) was listed later and had several apps at $925 and the PM is processing one of the tenant apps right now. The average current scheduled lease rates for these unit are only $814/month.

Comparing existing leases rates to our “Base Case Scenario” you can see these new leases are exceeding our projections:

2/1    New Lease +$78/month  Our Base Case is +$53/month

2/2.5 New Lease +111/month  Our Base Case is +$71/month

Obviously, if we can exceed our Base Case scenario, then we have a good chance of beating our projected 8% cash distributions and 14-16% total returns by a healthy margin.

I’m going tomorrow at 11 am to meet with a couple of other investors and take them around the properties.

Let me know you’re interested in considering investing along with us. 

I know lots of folks on BP prefer to do their own investments directly, but I figured I’d keep the community in the loop on this as we move forward. I think this one is looking really good - both as a cash flow producer and a value-play.

Also, you can use this link to sign up for updates and to see new projects:

Sign me up with Brightleaf

Hi John, great speaking with you today. 

Let me know when you're heading to Tampa. We can meet up there and drive over to see the properties.