All Forum Posts by: Snehann Kapnadak

Hi Everyone,

How do you approach partnering with a property management team to do deals together? I'd like to give them a lot of the equity so that they're incentivized to keep the property up in exchange for financial help with the downpayment and for a lower management fee. At first, it would be for smaller commercial properties, but if the relationship grows well and we make a good team, I'd love to scale up with them.

Ideally it's a win-win for all:

For the PM:

• They get a large chunk of equity
• They get more business.
• They get access to my investors' capital for potentially future deals
• In a way, they eat what they kill

For me:

• I look favorable to the lender with an experienced PM team as a partner
• I'll get a deal under my belt
• I'll be able to get help with the downpayment, reducing the burden on my investors and myself

For my investors

• Sure, they lose out on some equity, but they'll get a (slightly) higher return due to the lower monthly management fee
• They'll sleep easy knowing that the PM has skin in the game and is experienced

To be clear, I'm playing the long game, so I'm more than willing to do say, a 55/30/15 split with the PM/Investors/Myself and with a 3-5% monthly management fee. I don't need to hit a home run.

I've heard that @JoeFairless talks about partnering with a PM company in his new book, but I haven't had the chance to read it yet. Thoughts? What am I overlooking? How does one approach a PM with this strategy? Thanks in advance!

Hi Everyone,

How do you approach partnering with a property management team to do deals together? I'd like to give them a lot of the equity so that they're incentivized to keep the property up in exchange for financial help with the downpayment and for a lower management fee. At first, it would be for smaller commercial properties, but if the relationship grows well and we make a good team, I'd love to scale up with them.

Ideally it's a win-win for all:

For the PM:

• They get a large chunk of equity
• They get more business.
• They get access to my investors' capital for potentially future deals
• In a way, they eat what they kill

For me:

• I look favorable to the lender with an experienced PM team as a partner
• I'll get a deal under my belt
• I'll be able to get help with the downpayment, reducing the burden on my investors and myself

For my investors

• Sure, they lose out on some equity, but they'll get a (slightly) higher return due to the lower monthly management fee
• They'll sleep easy knowing that the PM has skin in the game and is experienced

To be clear, I'm playing the long game, so I'm more than willing to do say, a 55/30/15 split with the PM/Investors/Myself and with a 3-5% monthly management fee. I don't need to hit a home run.

I've heard that @JoeFairless talks about partnering with a PM company in his new book, but I haven't had the chance to read it yet. Thoughts? What am I overlooking? How does one approach a PM with this strategy? Thanks in advance!

"Depends on your time horizon and goals" is the classic answer. IMO if you have the time and passion for it, jump into a small MFH directly (6-12 units) or so just to get your feet wet and your network built. The economies of scale are there. Then you can learn the ropes of managing it (or managing the PM) and move on to bigger properties. To me, I'd then take some of that money and diversify it just a bit into either SFH, notes, or passive syndications just so you have multiple streams trickling in.

Good luck!

Hey @Ryan Fox I've seen William Robison's name dropped a lot on this site and they've been mostly positive. I personally haven't worked with him but it may be in your interests to search for his name in the forums instead of his company's name. Hope this helps! Let us know how it goes.

Thanks for all the responses, I really appreciate it!

@Hadar Orkibi Got it, so I can put the LOI in my name and then assign it to my LLC (when it's created later)? Sure, rough numbers are ~300K asking, I value it at ~250K, about an 8 cap, 9% CoC, located in the KCMO market.

@Robert Borr Noted about talking to my attorney first, thanks! Especially because most of my investors would be family and friends and non-accredited.

@Percy N. It's an 8 unit property. It would be my first one, hence why it's small. So by your estimates, I'd probably need about 5-7K just in EMD and additional out of pocket expenses. I'm finding a hard time building that credibility with brokers but hoping to start with smaller units like this one to build that up.

@Andrew Johnson and @Alina Trigub Good to know, thanks a lot. Since it's about 250K-300K, and since I don't have that kind of cash myself, I was essentially going to partner with fam & friends and we'd raise enough for the down payment (if I can find a lender who's willing to loan that low) and split the returns.

@Account Closed Definitely agree with having a list of investors including those who've committed to the deal + backups who are willing to step in in case others pull out. Thanks!

Hi All,

Hope you're enjoying MDW!

I have a "layup" question that I'm actually struggling with. I think I found a good deal but not sure where to go from here. I've analyzed it in greater detail and the numbers look great, and I put in a soft offer to see if the seller would entertain negotiations. I have a PM, CPA, and attorney on hand, but still need to syndicate the money. Do I set up the LLC first? I'm hesitant to send a formal LOI and put the property under contract in my personal name & without having the funds ready. Where do I go from here?

Thanks in advance!

Hey Anjeesh and Marcellus , I'd recommend Nick McKinnis at McKinnis real estate. He manages my 1 SFH in Independence and is doing a really good job so far. Feel free to drop my name. Good luck!

Hi All,

Happy Friday!

I was wondering what the local insight was on properties around Scarritt Point and the Historical District of KCMO, along Independence Ave. in the 64124 zip code? I did a quick search on Trulia and saw that it has the highest crime relative to the rest of Jackson County, but wanted to know what people think of the area in more detail. Is it gentrifying at all? Or is it a lost cause? Please let me know. Thanks in advance!

Congrats on taking the plunge into REI @Ron S.! I bought my first TK property in KC too. Good luck moving forward!