All Forum Posts by: Mark S.

@AJ Singh

@Alex Evans

@Nathan Gesner

Update: We decided to accept the rental assistance.  She paid June’s rent on her own.  Rental assistance is covering July.  Lease also ends in July.  Based on her situation, I decided to not raise her rent on the renewal (PM said we’re about $70/month under market at current rate).  Tenant gives notice to vacate by end of July.  Now, tenant is asking for us to let her stay through mid-September and PM asking me if I want to approve this. 

Been playing phone tag w PM to try to get more info.  My gut says no, but don’t want tenant to trash the place if we have her move out by end of July as originally planned.  If I let her stay, rental assistance will cover August and end, and she may or may not be able to pay September.  We also can’t evict for the 45 days for non-payment, so realistically, I could be stuck until mid-October at a minimum with no additional rent and likely longer due to eviction process.  Could go to end of year or even into next year.  

Don’t want to say no and then tenant signs 1-year lease and plans to move out in middle of it (mid-September) anyway.  I feel like I was being nice by not raising her rent and now she wants to basically go month-to-month for 1.5 months.  Part of me says to put my foot down and not approve the request - sign lease or move out.  Other part of me says to grant the request because realistically, tenant will likely do what they want (or trash the house if not) anyway.

Accepting mid-September would delay the inevitable turnover costs but I’d have to get it re-rented going into winter, which would be tough.  I’d rather get it turned now (what’s 1.5 months?), get it re-rented for closer to market rate, and have a better chance of actually getting it re-rented during the summer than later this year. 

What do you guys think?  Lease or Buh-Bye and turn/re-rent now or let her stay and roll the dice for later?  This is in Memphis, TN.

Hey Everyone,

I’m under contract to buy another turnkey rental in Memphis, TN.  Inspection just came back with several items (to be expected), but one of particular concern is the visibly sagging roof after the turnkey provider just put a brand new roof on.  Planning to question them on this (and ask for them to repair the other findings), but wanted to get some opinions here first.  

I have a builder friend who mentioned that it could be due to a sagging rafter but hard to tell from just an external picture.  I’m wondering how in the world the provider didn’t notice this when putting the new roof on and if this could be a deal breaker.

I need to circle back with the inspector for more info, but the report basically has a CYA statement that recommends further evaluation by a licensed contractor.  Does this appear to be a big deal or quick fix?  Bigger question is that this is a very large turnkey provider and whether or not something like this is indicative of them now cutting corners and their work quality declining?

When does his course come out and how much is it?

Do both.  You can invest passively in the stock market via index funds and the like.  You can also invest passively in real estate via turnkey rentals, syndications, and the like.  You might not have the most exciting story to tell at cocktail parties, but there’s nothing wrong with doing both.  I’ve seen great results in both areas over time.  I like to call myself the most ambitious lazy person I know.  It’s worked out quite well for me so far. 

 AJ, how’s your experience w Renshaw been?  Feel free to PM me if you’d rather not say publicly. 

Why do you say that?  You can PM me if you’d rather not say publicly.  Interested to hear your experience.

I was just contacted by one of my PMs for one of my turnkey rentals in Memphis, TN.  The PM stated that the tenant has applied and been approved for rent assistance through this program.  I'm told the program will pay her June + July rent.  One of the conditions is that we cannot evict for nonpayment for 45 days after the period covered (so, basically mid-September) if we accept the rent assistance.

She's been a great tenant and has been in the property for almost 2 years - always pays on time.  I'm assuming she maybe lost a job and needs a chance to get back on her feet.  I'm not sure what questions I can ask the PM about the situation (or if it even matters, quite frankly).  I looked at the requirements to qualify for the program and it pretty much implies that there's no way she still has the same full-time job to qualify.  

Trying to weigh the pros/cons and think this through.  Here are my thoughts:

If we accept, rent is paid for next 2 months and hopefully she gets back on her feet.  No current eviction / legal expense, no non-payment of rent for next 2 months, etc.  If no improvement, can't evict for 45 days, but could have these expenses later.

If we do NOT accept, no rent for AT LEAST the next month or two, likely eviction/legal expenses sooner, etc.  Also, this wouldn't seem to give her a chance to get back on her feet.

1.) What questions, if any, should I be asking PM?

2.) Based on the info above, would you accept rent assistance payments?

PM is encouraging me to accept.  I am leaning that way.  Just want to make sure there aren't considerations I'm not thinking through in the heat of the moment.  Any thoughts/feedback greatly appreciated.  Thanks in advance.

@Brock Mogensen @Andrew Hoganthanks for the replies.  Another thing that’s come up is regarding percentage of pass through depreciation to limited partners.  I suppose anything goes based on what’s in the PPM, but what are some of the more common ways to structure this?

For example, one group stated that they would give 100% of first year pass through depreciation to investors that came in before year end as an incentive.  

Another group says 50/50 pass through depreciation.

And I’d have to go back and look, but I believe many others would base it off of proportional ownership in the entity.  So based on your equity investment, whatever fractional percentage ownership you have, that would be your portion of pass through depreciation received.  

I'm looking at a self storage syndication fund that has some language in the PPM that capital shall be placed within 90 days.  If it isn't the sponsor can either choose to return it to the investor or the preferred return will start to accrue after 90 days.  Is this normal? 

I understand that funds are constantly seeking properties/facilities to put into the fund and the money may not exactly be "working" 24/7 until placed, but wouldn't an investor normally expect to earn a return (whether full preferred return or even a lesser amount) on their cash sitting in escrow (since there's always an opportunity cost)?  Or am I being too picky here?