All Forum Posts by: William Tomp

@Ashton Levarek - I hope that answers your questions and let me know if there’s anything else you want to know. Also - I think I mentioned it but I live in California but have invested solely in Phoenix Metro so far.

@Ashton Levarek - Thanks for reaching out. I’d be more than happy to set up a conversation with you and Chris to hear more about the types of syndication/commercial RE deals you guys are doing. 

There’s a lot to my why and goals. I’ll try to keep it as short as I can without leaving out important aspects.

Real estate always seemed like the best way to build stability and wealth. I didn’t grow up poor by any means, but my family’s financial situation was very unstable and I never wanted to live like that. Real estate provides a way to earn an income and build wealth through value add and appreciation.

Specifically, I’m the most interested in apartment complexes. I think buying moderately distressed apartment buildings in B/C neighborhoods, fixing them up, filling vacancies, raising rents, collecting cash flows and holding them for anywhere between 18-72 months before selling for a good profit is the best strategy I have heard of. This is for a variety of reasons including stability, cash flow, value-add and appreciation potential. Flipping houses can help me make some short-term cash, but the main reason I’d flip houses would be to build quicker capital for a multi-family portfolio. 

My 2020 financial goals are to flip 8 houses and generate 150k profit from those houses. My other goal is purchase at least 24 apartment units. 

In 5 years - I have the goal of having purchased 1,000 units. I know it’s ambitious, but careful planning and growth can get me there.

Location wise - I am comfortable flipping anywhere with reasonably priced housing  and market stability/quick growth potential - Phoenix checked those boxes but where I live in Southern California did not. For multi-family I haven’t settled on a city, but have been looking for high cash flows (growing Midwest And Southeast US markets) with moderate appreciation upside in the next 24 months. Afterwards I’d be more willing to invest in complexes at high price points with higher appreciation potential but less cash flows. 

Great quote by the way, I read Rohn’s “The Power of Ambition” a few years back and it’s one of my all time favorites. 

@Wes Blackwell thank you for taking the time to reply. You bring up a valid point of why I even want a partner in the first place. I’m not attached to having a business partner at all, and I am happy to continuing to work alone if the right person doesn’t come along. But if I can find the right person to partner with I think we could be more successful together than if we were independent. Here’s why:

1) In my limited RE experience, I’ve worked with some great people, but ultimately everyone is just looking out for themselves. It’s good having someone else who I can fully trust and have open discussions with. 

2) The cliche “two heads are better than one”. A partner can find something in a deal I may have missed. Especially in larger complex deals. 

3) You nailed it on the limited commercial RE experience. The bigger properties can be a little more intimidating and an experienced partner could help a lot there.

4) My other shortcomings are that I have limited property maintenance/rehab experience and still tend to miss things and Under-budget rehab costs (though I’m getting better). I also still could use some help with sourcing and finding and closing on good leads. If I proceed working on my own, that’s probably where I’d need to put in the most work.

5) I have my own capital and I’ve made progress getting some private investors to to help fund deals as well, but it’s still limited and someone with access to additional money would also be very valuable.

I’ve already had a few pretty cool people reach out to me. Even if I don’t partner with them, I always enjoy talking to other motivated people who I may be able to work with down the line. 

Hi,

I'm looking for someone to partner with on multiple deals. There's a lot of things I'm looking for in a partner, and I won't settle for anything less. I'm looking for someone who is as hungry and motivated as I am. A business relationship where we can hold each other accountable, share and celebrate our wins, and strategize and grow from our mistakes. If this is something that interests you, and you are looking for a reliable partner for multi-family apartment deals then please take the time to read this. 

What I bring to the table: 

-I have 9+ Years of experience in running a business. After 8 years of running a ticket resale business and growing it from nothing to 25+ employees, I was bought out of my half to pursue real estate investing. I consider myself to be new to real estate investing, but have flipped houses remotely in Arizona for around 9 months now.

-I have some of my own money to invest now (A few hundred grand), and will have more coming in over the next few years. I'm debt free, live moderately, and believe in reinvesting profits back into my properties to accelerate growth/long-term cash flow. 

-I am extremely motivated and hardworking. Real estate Investing is my full time job and I work 45+ Hours a week, every week. First-Hand Experience has provided me the most knowledge, but I've also listened to over a hundred hours of real estate podcasts, read 7 of the top real estate investment books, and talked to many trusted and experienced real estate professionals. In addition, My general business knowledge is pretty extensive and I'm a college graduate with a business management degree. 

-Skillset - I run numbers all day, every day in my head, I can manage people, create and manage systems, make cold, calculated business decisions, negotiate effectively, analyze deals and financial reports, and I have the humility to admit when I am not good at something and find a professional or partner to step in. 

What I'm looking for in a partner:

-Working on real estate full time 45+ hours a week Or have your own money to invest. If I'm going to be putting my time and money into deals, then I would expect a partner to do the same.

-Ability and desire to reinvest profits back into the company short-term. If I'm reinvesting my profits, my partner should be doing so as well.

-If you don't have your own money and only have time, then you'll need to raise some capital from private sources. Ideally, as partners we'll leverage our own money in addition to traditional and private funds to maximize growth and ROI. So if I'm bringing in money, my partner will need to as well.

-You'll need to be self-motivated and a downright hustler. If you're not already successful/wealthy, you have to be willing to live moderately and make sacrifices while the business is growing. 

-You'll need to be charismatic and good at networking/building relationships. This is a key to success in real estate.

If you want to schedule a time to talk, then let me know, either here or privately. If you don't want to partner with me but just want to talk real estate or want to explain another way we could work together, then also send me a message. Thank you for taking the time to read this post.

-William

@Evan Polaski Thank you, that's a really informative response and has me thinking on multiple levels. I'm seeing that if the vacancy rates are trending in the right direction, it could end up being a really great investment over time. On the other hand, if the property itself is overrun with bad tenants and has a bad reputation, it may be costly and difficult to change that. I've been spending so much time looking over the numbers on these properties but neglecting the story behind the property and that needs to change.  

@Ryan Daigle I see what you mean, It felt like something was missing from the equation and that’s why I posted here. Recent trends look okay, but more than likely there’s something further back that made the neighborhood undesirable. Good property managers should have more info on that for sure. 

And I’m happy you brought up the 92% occupancy rate. I’ve heard 90%+ occupancy being the gold standard and to steer clear of properties in neighborhoods with lower occupancy averages. I was just wondering what other investors thought of properties in high vacancy neighborhoods if they were offered at a large enough discount. 

@Ryan Daigle Ended up making an offer was outbid on this one, so onto the next one. 

I understand a lot of the fundamentals of why but thought I may be missing something. Appears that they overbuilt in the 90s, it’s not densely populated enough, and a little bit too far away from the main city. The trends looked okay. Vacancy slightly down, Income, population up over the past 5 years. Unemployment and crime down. The street itself has complexes with much higher occupancies than subject property. Still seems like I could be missing some things, What else would you recommend I look at? 

@Jacob Sampson @Bjorn Ahlblad

Thank you for the responses. It's helpful to have reassurance from a couple of experts. I've been told to avoid high vacancy neighborhoods at all costs, but I agree with you Jacob that it seems reasonable to buy a cash flowing property that is selling as a good deal based on current 40% occupancy number, and not proformas. And if I can put the capital into property improvements and manage contractors like you say Bjorn, then I could probably get occupancy to the neighborhood averages. As I have learned from residential flips, that's sometimes easier said than done. 

I'm just looking to get an opinion.

As investors or property managers, do you completely avoid neighborhoods with high vacancy rates, or would you consider purchasing an apartment complex in a neighborhood with high vacancy rates if the price is right?

There is one neighborhood I'm looking at where the vacancy rate is roughly 29%. The property I'm looking at is currently at 60% vacancy. If I were able to bring up the property to neighborhood averages, there would be huge cash flow and NOI Increase. The property needs a lot of capital improvements and can be purchased at a deep discount due to seller COVID panicking. The neighborhood is decent (B, maybe B-) just a little distant from the city and lower population density. All other things being equal, is this something I should look further into or is it something you'd recommend I steer clear of?

Thanks for the replies everyone. I ended up buying a couple residential properties instead of small commercial, but now I know to always use an attorney on any commercial deal. Thank you