All Forum Posts by: Tamiel Kenney

@Brianna Williams Hi Brianna! Have you attended any MeetUps in the area yet? DFW has a massive amount of them in almost every niche of REI. You might as well learn as much as you can during this time and start building your list (people who may invest with you or partner with you at some point in the future)!

@Stacy La Pineda  If you want to consider this partnership further, you might want to straight out ask him why he does not want to put his name on the loan. For any partnership to succeed, you have to be able to be direct, open & honest. (80% of all partnerships fail!  So, plan for the worst...but hope for the best.)

Good Luck Stacy!

@Stacy La Pineda  Hi Stacy!  Although we only buy large apartments and not Single Family, someone leaving their name off of the paperwork but still having ownership would not be done. We do know of someone who is not legally able to sign their name to the loans so they have others (who are just eager to get their 1st deal) to sign on the loan for him.  In our world, if a partner cannot or will not sign their name on the documents, something is wrong!  RUN!  

Perhaps some SFI (Single Family Investors) can give their opinions as well.

There are LOTS of con artists in the real estate investing world!  The more you learn from other people's experiences, the better off you will be!

I'm glad you posted this question on BP and hope you get more feedback!

We highly recommend CityGate for B/C Class Assets.

@Alex Flaugher  Hi Alex!  When you speak to an attorney who specializes in Real Estate Syndications...Make sure he explains to you the difference between taking on Accredited Investors vs. Non-Accredited Investors.  This will determine if you can advertise publically that you are looking for investors. 

Although I have heard of a lead investor or syndicator taking 40% or more of the deal...it really is determined by the strength of the deal and the education of your investors.  Some investors, who are a part of certain educational groups, are taught to believe that if a syndicator takes more than 10-20% of the deal... they are trying to RIP OFF the Passive Investor.  

With that being said, the way you structure each deal (each deal you do can be structured differently)...is determined by the investors that you bring into the deal and what their expectations are as far as returns and splits.  The more educated the investor, the more complicated the splits can be - such as waterfalls.  

But, since this is your first syndication and the average investor likes things SIMPLE...You might want to consider starting with a 80/20 or 70/30 split [70% to the Passives and 30% to the Syndicator (you)].

Again, If the deal is strong and the numbers work for you and the investors involved...then all is well.

As you buy larger deals...keep in mind that It is typical to take a 1-3% Acquisition Fee and 20-30% of the deal...As well as a 1-2% Asset Management Fee to Manage the property or Manage the Property Management Company that you bring on to manage the day to day operations.

Hope this helps some!  Good luck Alex!

@Curtis Rouse Jr  I think an issue you may find is investors have the same high expectations for returns as they have received in the past, even though times have changed. The fact is, great markets are not providing the returns like they used to. So, we see people compromising on their underwriting simply to make the deal work on paper.

I live in Dallas and love the market here, but so does everyone else. There are many things we can control on a property, but market appreciation is not something we can control.  We see people buying deals in the hopes that the market will keep going up (which is undstandable). However, when times get tough, (which they will), some people may have a hard time covering their debt payments.

We have started buying deals in areas that have a strong cash flow -- I personally think cash flow is king these days. We primarily focus on the Southeast of the US. The advantage...cash flow is typically better although the market appreciation may not be as strong. Many cities in the southeast have a lot more value add deals. There are also a lot of people that self-manage in the Southeast and if you have a strong operator you can go in and make a lot of improvements.

Hope this helps!

@Joshua Crow  Hi Joshua!  Welcome to BP!  This is a great place to learn and get your feet wet with real estate investing!  If you have a specific niche that interests you, you can simply set your BP Keywords so you can focus on those specific posts/topics.  Or if you have a question, post it and watch all of the responses that come in.  You will love being a part of this community!  Happy Learning!

@Lillian Nguyen Hi Lillian!  I run a MF Meetup in Plano/Dallas. Our next one is March 25th.  Feel free to look us up: Think Multifamily.  We would love to have you join us. If you have any specific questions you would like answered between now and then, just send me a messsage! 

@Carlos Casanueva  Yes, we currently have 2600 units. We have sold some others, but the problem now is if you sell, you have to find another deal to put the money into. There is nothing wrong with selling, but I like the strategy of doing a refi or a supplemental loan (if possible). That way you can pull your cash out tax free (verify with our CPA) and still own the property.

The market is hot for sure. But, for larger properties, we are seeing some properties that have 40+ tours and 30+ offers. So, while the 10-12 units can be competitive, they are less competitive than the larger properties.

If you are trying to find larger deals with no track record, it will be a big challenge. You need to find someone you can team up with so you can leverage their track record. My husband and I actually did a short video (less than 3 minutes) about this (https://www.youtube.com/watch?v=tU_rXk2uRLc) if you want to check it out.

And, if you are going to raise money from others, you will want to make sure you understand the legal aspects. There are strict rules on what you can/cannot do.

Our smaller properties...we bought them even after we had large properties. Looking back, I wish we didn’t buy them because they are a distraction. We just sold one of the 8-units. The other one we are doing a refi on.

BTW...my husband Mark and I will be at the Real Estate Guys Event as well...let’s meet up.

@Carlos Casanueva  Hi Carlos!  There are definitely pros and cons to both.  We started off in small MF years ago!!!  We have over 2600 units now...mostly through syndication.  We are passive investors as well as syndicators, so I understand both sides of the coin.

Syndicating larger deals is our sweet spot now...but not without its own struggles.  Partnerships are great...but they can also be a source of contention.

Getting out of a bad partnership is harder than getting out of bad marriage.  So...If you opt for partnership and syndication...Prepare for the worst case scenario in your contracts and hope for the best.  

You have to understand the pros and cons of both syndication and partnerships and decide what is best for you.

We have (1) 8 unit property now and just sold an 8 unit...and for the most part, buying 100 units is the same amount of work.  Actually our 200+ units are the easiest. If you are considering a 40-50 unit through syndication (using other people's money)...why limit it to 40-50 units?  With 100 or more units, you can consider using a 3rd party property management company to run the staffing, leasing, etc...and you can manage them as asset manager.  This will give you the ability to work on your business...to go Bigger - Faster - and not as much IN the business. 

The advantage to staying in the 10-12 unit zone and managing yourself...

(1) There tends to be less competition for the smaller units

(2) You don't have to worry about conforming to the SEC Requirements of a Syndication (but easy to learn if you wish)

(3) You don't have to worry about a partnership  - which can be awesome or nightmarish (WE have stories of BOTH!).

It is definitely a personal decision.  I think you need to decide if you enjoy the full hands on experience of self management...and if you want to continue to invest the time.

Hope this helps some.  Good luck in your decision making.  Real Estate Investing is very exciting business!