All Forum Posts by: Tom Moran

@Account Closed Thanks again for taking the time.

Greatly appreciate your advice @Brendan Kelly @James Kojo

Sorry it took me so long to return to the forum. I work long hours. I read the replies and I am so grateful for all the information. Yes I think you both got where I was coming from, the areas are not so good - but the basic income is.

My aim would be to hold for cash flow. Brendan you may be completely correct on the appreciation piece and James I overcompensated (most likely) in the determination of expenses mainly for maintenance issues. This offering is different than what I’m used to given tenancy and market risk but the hope is to avoid buying one Multifamily property at a time (long time) and scale up quickly - saving on closing & other costs by putting together a package offered at a discount. The deal works from day 1 but might involve a lot of oversight.

Any further recommendations of this type of deal – like the properties themselves I doubt the owner keeps great records, rents are cash, most leases MTM. 

Greetings everyone,

I'm reviewing a package deal right now involving 6 properties – 14 units. Most of the properties are in the same neighborhood (D-Class), there is the option to extend the deal to 10 properties – 22 units. After pulling the real estate assessor data it really is a mixed bag. High and low valuations but very good purchase prices (back in 2008-2010) by this current owner. 4X duplex, and a 6-unit.

All of the homes are currently being rented (ranging 550 to 750) totaling 7900/month Gross. My best guess is that Net monthly would = 30% accounting for all expenses. After driving the neighborhood not all are in the best of shape.

What steps would you take to evaluate this mixed portfolio deal? Do you do a cash flow analysis on each property or the entire package? There are no recent comps for some of these and in obtaining a loan how is the value/appraisal determined. The owner says he doesn't want to sell homes individually and cherry picking individual deals would dilute his benefit. Owner has experience and wants to sell and move to commercial property from these mixed Multifamily properties (his motivation). I want to scale up but trying to avoid a package which includes his non-performing deals??

Any thoughts would be greatly appreciated..