All Forum Posts by: Ian Ray

@Terrance Clark I am honestly unsure.  But the support team at insightly probably has that answer for you if you reach out to them

I like Insightly personally. It has  very powerful free platform, as well as a great premium package.  I use it for my consulting firm and it works like a charm.  You can organize data on multiple levels and share it with your team as it updates.  Great for follow ups.

@Mickey Kropf, that is an amazing idea!! Thanks man! I really appreciate you throwing that out there.

@Nathan Emmert,  I appreciate your comments.  I have had a ton of great feedback about this plan in my duplicate post in the business plan section.  Because of this information, I am already revising my plan.  I have no problem listening to sound advice from subject matter experts, and really don't take critiques that I have invited personally.  If you can knock a hole in my plans/thinking, I will appreciate you that much more.  We only get stronger by shoring up our weaknesses. And to do that, I need them pointed out. So thank you.

As for the number of deals that need to be evaluated, I do understand that.  But I also don't plan on looking at everything myself.  The plan is to have a company that can handle that volume.  I understand it will be slow at the start but once momentum picks up and the (revised) model proves itself, I feel like if we weren't shooting high, we would be courting mediocrity.  I personally believe that an absurd goal with a sound, methodical approach is far better than a "reasonable" goal with the same approach.  You can miss one (the absurd) and still be better off than hitting the "reasonable" goal.  But that is just me.

@David Faulkner,  we have a few competitive advantages that we believe will help us pull off our goals.  But I will be revising according to the great advice you all have given me.  Thank you for taking the time out to comment. I really appreciate it.

@Ray Dipasupil, especially when the model of charging per bed instead of per unit is already established.  It really increases returns rapidly. 

@Brian Burke, I have even better news.  I am going to do the smart thing and listen.  This is why I love Bigger Pockets.  You have given me solid advice I would be a fool not to listen to.  I have NO intention of banging my head against a wall that you just showed me was there.  

I plan on adding you input to my plan immediately so I can completely bypass that frustration you just pointed out.  Now, I am completely sure I will run into other areas that make me want to jump off of a cliff chin first some days, but it won't be that one!  

Also, thank you for the advice on using consultants.  

Now to revise, and then practice my pitch!

@Brian Adams, Thank you for your thoughtful comment. To clarify, I do not plan on managing 7,000 units myself. I plan on owning or being a part of entities that control that many doors. I only want to actually have my hands on about 3k across multiple markets. And then translate that success into being an Equity partner, or a JV partner (my company and team, not just me) in the other 4,000.

As for my why, that has been clearly defined for a while now.  I even have an action plan and a vision board to accompany it that I study daily. 

I realize my goal is extremely aggressive, and there is a reason for that.  As they say "The best laid plans of mice and men..."  Setting a high bar gives me something to shoot at with as much energy and passion as I can muster, and it will help me push past the days and weeks where the friction is so bad I feel like nothing is going right for me.  

@Account Closed I plan on offering quarterly disbursements of cash flow to my investors. How large those disbursements are will depend on the structure of the deal and what type of annual CCR they are looking for, which would be discussed before I shopped any deal to them. It also depends on the position of the investor in the deal; equity partner, JV partner, GP or LP. In some situations I would be willing to offer a preferred rate of return in exchange for a lower equity percentage.

As far as Entities, I have been advised on using a Series LLC, but I am getting a second opinion on that.

This is my Multifamily investing business plan, based on the Outline given by the wonderful Ryan Moeller. I would love feedback from all of you awesome BPrs, Good, Bad, and Ugly. I am jumping into this new industry and would love to get off on the right foot.

1. Mission Statement – To use the vehicle of investing in multifamily properties of various sizes (minimum of 10 units) to generate wealth for myself and my investors in a stable fashion. I plan to acquire ownership or control of 7,000 units within the next 7 years through a combination of syndication, joint ventures, and personal acquisitions.
2. Strategy – My strategy it to acquire moderately sized (50 to 150 unit) properties in emerging markets that are currently at a C+ to B- grade, as well as acquire large multifamily (160 to 350 unit) properties in stable areas around major industry and academic institutions that are B- to A- grade. The moderate sized properties will be managed by either an in house property management group that is a General Partner, or an outside property management company contracted for service on the specific property.
3. Market – Target markets will include Charlotte, NC, Raleigh-Durham, DFW, Knoxville, Nashville, and Johnson City TN, specifically around public education institutions that have pent up demand for viable student housing.
4. Criteria – I will select properties that can be acquired with a 65% LTV with a cap rate of 5.6 to 10% (based on size of acquisition and financing in place) cash flow sufficient to generate a minimum cash on cash return of 11%. The max purchase amount will be contingent upon the specifics of the deal and the position of the market at time of evaluation. With that being said, I will aim to purchase properties at least 15% below appraisal value. I will seek to hold these properties as long as the value of the investment and the yearly cap rate stays within our models.
5. How to find deals Marketing plan – I plan to network with brokers that specialize in the inventory I seek. I also intend to dialogue with other investors in the space who may be seeing deals that I am unaware of that fit my criteria, but not theirs. I will develop relationships with commercial lenders, and private money sources that invest in my target markets to create an ecosystem for information flow.
6. Finance – Deals will be financed on a case by case basis using a blend of private capital as well as JV and equity partners to raise capital for the down payment on the property. I will seek to use either conventional financing or seller financing where it makes sense to fund the rest of the acquisition of our target properties.
7. How to do deals – How are you going to turn a purchase of a property into profit? Clearly define the steps. Repairs, rent, management, implementation of exit strategies, etc.
8. Exit strategies, Backup Plans – I plan to maintain control of all properties acquired until the opportunity to sell becomes a better proposition than holding long term. I plan to return the bulk of investor principal via cash out refinance after a 3 year period, paid out in order of agreement based upon the specific deal structure. For student housing, I plan to execute a master lease with option to purchase in order to remove investor capital but maintain control of the property. I will also evaluate seller financing options as applicable.
9. Team & Systems – I will structure my team per acquisition. Team roles will include on-site property management and maintenance from a General Partner property management firm, or a contracted firm, as well as in house CPA, Lawyer, and asset manager.