All Forum Posts by: Tyler Warne

 The things that I would be concerned with and how I would structure this is: What is the return on the actual investment? Would it cover 100% financing? I try and beat my interest rate with my return rate by 2% minimum. If the deal is good enough, you can find that gap money no problem. If it sucks, no one will want to partner or come in as hard money. First ask the seller to carry-back about 10-15% and then keep some cash for reserves - There *likely* will be an issue after you close that will be more expensive than you predict. Then you have a short term balloon, 3 or 5 years for that second position and take any additional cashflow and pay that down like hell. Then in 3 years, great cashflow and you are ready to re-fi but you mitigate risk and have a great asset. 

Good Luck! 

Investment Info:

Office Space buy & hold investment in Helena.

Purchase price: $6,250,000
Cash invested: $250,000

This is a state government lease. Right now extra cashflow has been getting put into the building. The property has a good overall utility, it is a large office building in the center of Helena. There is a government entity that leases most of the space, they are still almost exclusively in person and I have very cheap debt. The end of the lease is 3 years and I have a large balloon payment in about 1.5 years. The building will pay the short term debt off and then we should have cash-flow in the $12,000/month range after management. I bought this with about 120,000 down and a partner and a 250,000 commission.

What made you interested in investing in this type of deal?

See if I could do it, long term lease, no I really understand Gross Lease.

How did you find this deal and how did you negotiate it?

Seller's asked if I would put it on the market as their broker. It went under contract and then that deal fell apart. After that I said that I would take a little more time to find a new buyer, but if they wanted to sell to me I would give them 6.25m, they said OK and here we are!

How did you finance this deal?

conventional & seller carryback

How did you add value to the deal?

I am the broker, built the property management company to care for the building and put it together.

What was the outcome?

So far we have had about 120,000 in HVAC issues, some repairs, but overall it is going pretty good.

Lessons learned? Challenges?

I would have considered the size of this project a little more. It certainly was 'playing with the big boys'.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Yes, Tyler Warne - "He's the best and so dreamy"- My wife - I am the commercial broker in this market.

I think that the journey that I have taken is pretty cool. I also think that I took a few things too seriously that were really no big deal and that kept me from moving on faster, which will impact the day that I will retire. I think that I would say to myself to take more risks at a young age when failure or losing all my money wouldn't have been such a big deal. I am not resentful at my younger self either and think that I have done well despite the situation, and now I am in a very prime spot, both professionally and personally. 

@Samuel Mutschler Do you have a cpa? Most of these questions would be handled by your CPA. Depends a little bit on how the ownership is set up. Can you clarify who owns what and who’s paying what? And what is your role?

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $90,000
Cash invested: $1
Sale price: $190,000

off market, non arms length

What made you interested in investing in this type of deal?

no money down

How did you find this deal and how did you negotiate it?

did an appraisal for an owner on another property and he stated he was trying to sell this one

How did you finance this deal?

Bank 70k owner 20k

How did you add value to the deal?

didn't

What was the outcome?

made 100k

Lessons learned? Challenges?

take action

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

no

Do you have any updates after the hurricane? Any contingency plans for another venue? 

Investment Info:

Other buy & hold investment.

Purchase price: $1,925,000
Cash invested: $485,000

National credit tenant, large facility on 4 lots. 2 are unencumbered

What made you interested in investing in this type of deal?

opportunity, low maintenance on the ownership - good long term buy and hold.

How did you find this deal and how did you negotiate it?

Through my broker

How did you finance this deal?

Bank/cash/partners

How did you add value to the deal?

That is what I do.

What was the outcome?

Makin money and opportunity is here

Lessons learned? Challenges?

One tenant at $12,500 takes the same work as 1 tenant at 1,250.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I am a Realtor & Appraiser

@Kimberly Lima I like to start with why they shouldn’t sell to me. First I say they can get more money from the market, make sure they don’t have any parties that would buy at market rate and then say what you would need to buy the house for to make your numbers work. Make sure that they know what your daytime job is and that you are a professional. Disclose, disclose, disclose and get acknowledgment that they know what you are doing.

@Brian Plajer helocs are also short term loans so keep that in mind. If you are doing this to hold a property for 10 years probably not your lenders fav. Either think of a way to pay it down faster than a long term loan.

@Quan Chau ask for the meter history. See if that was transposed or there was another issue on their end. , similar addresses, similar names if there is something in common that you tenant and the city transposed it could be the issue.