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Under Contract on 98 units in Phoenix!

Discussion in 'Real Estate Investing' started by JustAskBenWhy, Jul 17, 2018.

  1. JustAskBenWhy
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    JustAskBenWhy Silver Contributor FASTLANE INSIDER Speedway Pass

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    Psyched about this one. I think I can create tons of value. Underwrites to mid-14% IRR.

    Took about 5 months of placing offers. But I love this one. Wish me luck!
     
  2. Sauce
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    Sauce Contributor

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    Congrats Ben. Looking forward to hearing about the details as things progress!
     
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  3. Envision
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    Envision Platinum Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass Summit Attendee

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    Any more details on your deal?

    What value do you think can be created?

    What are your thoughts on buying property at this stage in the market cycle?

    Hope things are going well for you @Sauce !
     
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  4. JustAskBenWhy
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    Well, I think I can add 35% value in 3 years. And my thoughts are - I am buying.

    You know, everyone always talks about the market cycle. People don't understand that the market cycle is only half of the game - money cycle is the other half.

    When property could be bought for pennies on the dollar, no one lent. Very few had cash to deploy. So - everyone was bitching and moaning that there are so many good deals and no money. Today, there is so much money and appetite, so everyone is bitching - we are too late in the cycle...You guys can't be pleased :)

    I like good product in up cycle, and I like good product in down cycle. So long as there is value to be created, I am all about it.
     
    Last edited: Jul 18, 2018
  5. MJ DeMarco
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    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    Whereabouts in Phoenix? General cross-streets?

    Congrats and good luck!
     
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  6. JustAskBenWhy
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    JustAskBenWhy Silver Contributor FASTLANE INSIDER Speedway Pass

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    No
    No specifics here, MJ.
     
    Last edited: Jul 24, 2018
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  7. CareCPA
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    So no info at all? No purchase price, rent to price ratio, financing details (investors vs institutional)?
    What's your value-add play, renovations? Something else?
     
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  8. JustAskBenWhy
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    JustAskBenWhy Silver Contributor FASTLANE INSIDER Speedway Pass

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    Not in a public forum. The SEC is kinda touchy that way, with this being a Reg D. Message me for details if you'd like.
     
  9. CareCPA
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    CareCPA Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

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    I guess I'm just curious what you're hoping to accomplish in this thread if you can't share any information.
     
  10. JustAskBenWhy
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    JustAskBenWhy Silver Contributor FASTLANE INSIDER Speedway Pass

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    Well, let me see if I can guide you in how this works.

    The intelligent way to do marketing for is to be present when someone needs what you've got to offer. That's in contrast to plastering yourself over every billboard like wet noodle on the wall - only Ford can afford to do that.

    So - here I am. I do what I do. If you'd like to know more - I think you can figure out where and how to find me. This way I am happy, you are happy, and the SEC is ecstatic...lol
     
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  11. CareCPA
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    Ah, ok, so purely a marketing ploy.
    I thought maybe you were going to bring in some knowledge the rest of us could use and/or learn from, instead of just inviting us to invest with you.
     
  12. JustAskBenWhy
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    JustAskBenWhy Silver Contributor FASTLANE INSIDER Speedway Pass

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    Tou-che' - for knowledge you pay.
     
  13. Kak
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    Kak Capitalist Swine Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Congrats on your deal. Rep to you.

    Can you raise the rents based on comps?
     
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  14. CareCPA
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    CareCPA Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

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    Hopefully this knowledge is free...
    Is Reg D just for accredited investors? Are you doing any non-accredited capital raises?
     
  15. JustAskBenWhy
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    Reg D 506c is for accredited people only, and allows wide advertising options. This raise is under $4M so we are doing 506b, which allows 35 sophisticated investors.
     
  16. JustAskBenWhy
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    Yup :)
     
  17. MJ DeMarco
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    @JustAskBenWhy -- you can't use this forum to solicit for investors, it's against the rules.

    If that's the purpose of this thread, I have to delete it. Please make it educational, or the thread goes.
     
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  18. JustAskBenWhy
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    MJ - understood. Do what you have to do. I am not about to (nor is it even possible) teach multifamily syndication on this forum.

    Those who follow the thread, if it stays up, will get updates as those become available. I am not releasing specific numbers, investment parameters, or projected returns on this thread, though. For this you'll have to reach out privately.

    I guess, the lesson here is this:

    As a real estate investor, I try to always have more than one exit. And as an entrepreneur, whenever I do anything I try to have more than one reason and accomplish more than one objective.

    That said, this is just an exciting time for me. It's big growth for me as an entrepreneur. It's also culmination of 5 months of very, very intense work. If anyone wants to be happy for me - please, I'll take it. This is one reason for the thread. Another is that obviously as things progress, I'll share bits and pieces. Finally, if any of this sounds interesting, ans someone wants to reach out for more details - why not? More than one objective...

    Does this work? If not, I understand if you need to remove this thread, MJ. Just calling a spade and spade.
     
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  19. JustAskBenWhy
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    So - I am privy to a lot of exaggerated hoop-lah about real estate. In actuality, all of this is actually very challenging.

    Just in financial terms, what we had to do on this deal was to offer a 6-figure EMD, and no finance contingency. Additionally, the bank good faith deposit is $50,000 to begin the loan app, and attorney fee is $15,000.

    Add this together, and what this means is that we are hot into this thing almost $200,000 - if it doesn't close for any reason, this money is lost.

    Now, I don't know about you, but I am not sure how anyone can be debonair about this. Think about what it takes to go hard on this much money - think about how much DD would have had to be done even before we were under contract for us to get comfortable around this. Furthermore, think of the established relationships necessary to even attempt to do this type of DD...?

    There is nothing debonair about this. There is nothing easy about this. And this is definitely not something a new investor can or should do!
     
  20. Kelley McEachern
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    Kelley McEachern New Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER

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    Hi Ben, Just subscribed on your site and looking to start down this Real Estate path. Looking forward to learning and executing in my area of the US.
     
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  21. JustAskBenWhy
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    It's my pleasure to help, Kelley. Good luck, and feel free to reach out.
     
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  22. Kelley McEachern
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    Kelley McEachern New Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER

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    Good luck with your deal. :) hope you get it the way you plan for it!
     
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  23. Kelley McEachern
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    Kelley McEachern New Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER

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    Will do, just picked up House Hacking (kindle version). time to read while waiting for your site downloads, Thank you.
     
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  24. JustAskBenWhy
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    JustAskBenWhy Silver Contributor FASTLANE INSIDER Speedway Pass

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    Let me know if there is a delay with the downloads. Happens once in a while. Truth be know, it's time to revamp JustAskBenWhy.com but there is never time...
     
  25. JustAskBenWhy
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    Just came back from the meeting with the PM. This, by the way, should be taught as lesson number 2:
    1. Number 1 is - know how to underwrite properly.
    2. Number 2 - know how to buy something that attracts a PM who can actually execute what you underwrote lol
    Ours manages 21,000 units in 5 States, but AZ is their home-base. We met with the regional manager who'll have our asset, as well as the guy responsible for purchasing of materials and procuring bids for work.

    We met to button up our CapEx. The project calls for well over $1M in reno costs, and, as they say - you're off by an inch, you're off by a mile...

    When coming out of the elevator, we bumped into the mortgage broker and the banker who flew out of NY to DD this deal. As part of their DD, they met with the PM.

    When people ask me how to manage a duplex in another State, I quite literally have no idea what to say.
     
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