All Forum Posts by: Rachel Luoto

Hi everyone, thank you for the input! I'm finding fees vary wildly, from 3% to 14%, and much of it depends on deal size and the developer's participation in the equity/cashflows on the backend. I think I'm going to go with the lower side as we don't have to split cashflow/equity with anyone on the updside. PS - I found out developers will even defer their fee for later, in the greater interest of creating a needed asset for the community. 

Hi everyone,

I'm a current Master's of Real Estate Development student at Portland State! I'm putting together a proforma for my final project, a $104MM mixed use development. I currently have a 4% developer fee scheduled. Would you say this is high, low, or just right? We are funded from a mix of LIFT bonds/LIHTC/TIF and a loan for the rest.

Thank you!

Congrats on your first apartment! Advice from my "best deal that didn't happen", a 16 unit complex - have an inspection by a structural engineer. 

On the last day before closing I got the general inspection back, saw a crack in the foundation, and negotiated for more time to have the structural engineering report. They found six-figure foundation work urgently needed in this "turnkey" property which killed the deal.

Best of luck with yours!

Aaron, I second what some people have said here, it depends on what exactly you'd like to develop. If it's a couple SFRs on a lot, that's an easier jump than developing a commercial building. 

I'm also based in Portland and am personally doing a master's degree in development, so I can build things like skyscrapers :)

Hi Ethan,

If you want to talk about education options more, I'm a current Masters of Real Estate Development student at Portland State and have owned a rental portfolio in the past. I'd be happy to connect and give you some insight on the pros and cons of work vs school.

Hi Kayla,

Have you considered Portland's elimination of single family zoning? That's something I'm really interested in! So there is the potential now to convert these large SFRs into duplexes. Or you could consider renting by the room as well. 

 Hi Maria, I had a few places in mind from a place of historic cashflow/legal environment/physical hazards/price point/economic outlook. From there I met people in my local real estate club who had invested out of state, and knowing and talking to them I invested in the same area.

 Hey Jared and Jessica, that makes sense to use full PM for buying out of state! If you were to go the leverage/apartment route, I'd try to partner with someone experienced. From personal experience, I had an out of state multi under contract. At the last minute serious structural issues were found to a six figure tune - this was marketed as "completely renovated" and "turnkey". So staying small and buying in cash is not a bad way to go with out of state property.

I'd read 1. The Millionaire Next Door, to understand that people with money aren't always who you expect and 2. Pitch Anything. And as Brandon always says on the podcast, putting together a nice binder with graphs etc, vs a verbal presentation

@Jared Mathis welcome to the game! I like this strategy - solid, simple, lower risk :) 

Do you plan on buying close to you, or far away? If you purchase near where you live, you could consider self-managing and hiring a PM as a consultant to teach you the basics! After managing my own local rental, I can't imaging paying property management for the months and months where nothing happens. There are services that provide the more hairy stuff, like evictions, a la carte.