All Forum Posts by: Tom Lacey

Hello everyone,

I recently finished the 60 hours of coursework for my PA real estate license. The broker that I will be "hanging my license" with is pulling together a 40 room Syndicated hotel deal just outside of Pittsburgh. The hotel will be built by Cobblestone Inn and Suites as a turnkey operation. This includes the operation of the hotel after it is complete. On the conservative side (48% occupancy), the year 1 COC return is estimated to be 14%, moderate occupancy (55%) the COC return is 19% and the optimistic occupancy of 62% will yield a 24.6% return. If we can get any of these returns, I will be in a better position than my current traditional IRA is earning (7% average return over the last 5 years). So the math makes sense in my mind. The investment would be $50,000 for a 3.125% ownership in the hotel. The long term plan will be to sell the hotel 3-5 years after completion, once occupancy is consistent.

This hotel is being strategically located 15 minutes away from the recently announced Shell "Cracker Plant" and we anticipate to close on the deal by the end of August 2016 to begin the construction process.

Has anyone had experience with a syndicated hotel deal in the past?  Any pitfalls for me to look out for?

I am also interested in the same type of property.  If you are a wholesaler and would be interested in talking about my strategy, please reach out to myself.  And Jeff too.

I've spoken to Brad Dornish on the phone and he was very knowledgeable. 

Congratulations Charles.  I am about 70% of the way complete with my online classes for PA Real Estate license.  How was the test?  Any study/preparation tips you can share?

Tom

Hi,

I am working on a deal for a multi use property close to my home (3 1 bed/1bath apartments + 1 retail space), it is currently fully rented and would cash flow. I am using the BP rental property calculator to arrive at a purchase price that would work for me and my goals. My agent worked up the estimated costs sheet for me and it came back higher than I was originally expecting.

My question is:

In the estimate (See attached picture) the first years insurance premium and the first years school taxes are included. The calculator asks me to enter the monthly insurance cost and the annual taxes. Should I be subtracting these two values from my closing costs value that I enter into the calculator? Is entering the full estimated closing cost amount "double dipping"?

It is having an effect on my COC return.

Thanks

Tom

Hi,

I am working on a deal for a multi use property close to my home (3 1 bed/1bath apartments + 1 retail space), it is currently fully rented and would cash flow.  I am using the BP rental property calculator to arrive at a purchase price that would work for me and my goals.  My agent worked up the estimated costs sheet for me and it came back higher than I was originally expecting. 

My question is:

In the estimate (See attached picture) the first years insurance premium and the first years school taxes are included.  The calculator asks me to enter the monthly insurance cost and the annual taxes.  Should I be subtracting these two values from my closing costs value that I enter into the calculator?  Is entering the full estimated closing cost amount "double dipping"?

It is having an effect on my COC return.

Thanks

Tom

I have also been told that Brad Dornish is the guy to get in touch with.  I have a phone call set up with him tomorrow to discuss our needs and will devise a plan after that call.

Thanks for all of the advice...I will get in contact with an attorney and CPA as soon as possible to devise a plan that works best for our investments.  I will keep you all updated as we progress.

Thanks for the reply and insights Terry.  Hopefully we can both learn a little bit as others reply to this.

I am in the process of taking the classes necessary to get my real estate license as well.  Maybe something we could partner up with in the future.