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OFF-TOPIC Part rant and part rave

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GoldenEggs

Contributor
Sep 4, 2007
321
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Silicon Valley, CA
My rant part:

We had an update on our property today. We decided to switch property management and two team members are going to be out there during the transition. One member has been talking about selling the property since November and has been a huge source of negativity. She wants to sell now and take a loss on her investment. We don't have a buyer in sight and not everyone wants to sell but rather rehab the property as we are planning. We have a potential lender to take out our bridge loan and they are also offering an increase up to 6 million once the property is rehabbed, without additional points. At that point, everyone could get their initial investment back (which was our original goal) and the property should be stabilized at that point. At the very least, the property would be in a better position to sell. The "Negative Nellie" said that a higher loan would cut into our cash flow so what was the point. I'm a bit boggled here.... she's willing to sell the property as is and take a loss on her investment rather than wait for the term sheet from the lender and see how much rehab we can do. We had called her first, when we had received the hopeful news from the lender, and she said we were being "cavalier" and "too optimistic." I would much rather approach the situation with an optimistic viewpoint than a "we're !@#$%*!" and roll over and die.

sigh... which brings me to my rave part:

I love coming to this site! It keeps me sane!! When I'm feeling like things are too hard and want to give up, it helps me to come here and re-read everyone's stories. Then I can go back to work and I feel re-energized! At the very least, I don't feel alone! So thank you!!
 

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Diane Kennedy

Bronze Contributor
Aug 31, 2007
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Can you buy her out at a discount (maybe even get her to carry some paper on it) so that you can free up all this negative emotion and energy suck? It seems if she's willing to sell at a loss, just to get out, there could be some opportunity for you here.
 

andviv

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Jul 27, 2007
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Diane got it right. As soon as I read your post I thought "great, offer to buy her out now".
Ask her how much she thinks she will get if she sells now, and offer her 80% of that amount and she what she want to do from there. Get rid of the negativity, it is a distraction. You are positive that this will work out, you have done your due diligence, you are certain this will work. Do not invite doubt and negativity to your project.
 
OP
OP
GoldenEggs

GoldenEggs

Contributor
Sep 4, 2007
321
38
25
Silicon Valley, CA
There are actually 2 people I would love to buy out but my husband and I are tapped out right now. We are in talks with another investor who may be able to take out both investors (financially, not physically!). I've been singing "put on a happy face" in my head every time I have to talk to those two people. At any rate, lots of lessons learned on what to do and not do next time!
 

shaunew

New Contributor
Dec 30, 2007
23
1
9
Seoul, South Korea
Congrats on what sounds like a huge real estate deal. I think the buy out is best. But not having the money puts you in a situation were you hope all goes well. Just be positive and hope that some of that rubs off on her.

What about pulling the group together and giving these two people a presentation on what you want to do and the amount of money they will make. Maybe they need to see the plan to keep involved. Run the numbers by them have your banker or lender confirm what the picture can look like after redoing the property and show them that investing is about profits and time.
 

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