Episodes

Leverage has helped a lot of multifamily operators generate great returns over the past five years, but many newer operators are now paying the price for too much leverage and higher interest rates. When underwriting deals, it’s critical do be overly conservative to account for realistic rent growth and growing expenses. Jordan Fisher, Principal of Next Wave Investors, incorporates ruthless conservatism into his underwriting in order to do well by his investors and never lose a penny of their mo...

Most real estate asset classes are efficiently priced and hard to find great deals. With land investing, however, you can buy land for literally 50 cents on the dollar with little competition. You basically just need to follow a formula that entails marketing and follow through. With very few start-up costs, you can launch a Direct Mail marketing program that gets you a deal in your first couple months. Daniel Apke, Founder of Land Investing Online, has been very successful flipping land on his ...

In the world of multifamily, few operators are scaling with 2-15 unit buildings. These are too large for most ma and pa operators and too small for larger syndicators. Ray Heimann, Managing Director of Terra Capital, is acquiring older properties in gentrifying neighborhoods in midwestern cities with strong job and population growth. These properties are more labor intensive from a construction standpoint, yet Terra Capital has mastered this process which has resulted in great returns for invest...

If you’ve been looking to make passive investments in hard assets but are finding it difficult to get the returns you’d expect, there are other great vehicles that can generate 10 % or higher with relatively conservative risk. Business loans made to well-run, established and profitable businesses that are not served by traditional banks can provide an attractive risk adjusted yield. Jamie Shulman founded Meriwether Capital with the purpose of providing short-term financing up to $5 million to bu...

There aren’t too many asset classes within Commercial Real Estate right now where you can generate 10% or more cash-on-cash returns before creating extra value and executing a new business plan. One exception to this is campgrounds. There are approximately 15,000 campgrounds in the U.S. and many of them are filled to capacity during peak seasons. Several of these facilities are owned by ma and pa owners that have not maximized their true revenue potential which makes them great opportunities for...

In supply constrained major metro markets with large employment bases, there’s always a strong rental market of young professionals who crave quality amenities. After the first Covid waves, we’ve seen rents come back in major metropolises and even exceed what they were pre-pandemic. Although there can be more brain damage dealing with challenges like regulations in these markets, prices have moderated and there are great buying opportunities for buildings with under market rents. Arie Van Gemere...

When it comes to underwriting, stick to your guns and don’t compromise or you may regret it. Even when you make conservative assumptions, expenses tend to rise and occupancy and rents typically contract when the economy goes South. Despite your best attempts at conservative underwriting, there are always surprises. Tim Bates, Partner at Worth Commercial Real Estate in Ft Worth, has returned an investor level 38% IRR to his investors since 2105 by being incredibly disciplined with his underwritin...

Today’s investing environment is fraught with many pitfalls. Over the last couple years, many multifamily sponsors in particular took on super high leverage with variable rate loans. These same sponsors are now encountering stiff challenges getting loan extensions because of lower occupancy and rental rates combined with higher borrowing costs. As a result, many of these sponsors will have to reach out to their investor bases for more capital or obtain rescue capital to keep their deals afloat. ...

Real Estate can be an amazing investment to grow wealth. It has cash flow, appreciation, and tax advantages, but most Real Estate operators only allow accredited investors and request high minimums to boot. Accredited investors are individuals with gross income exceeding $200,000 or joint income exceeding $300,000 or have a net worth that exceeds $1,000,000 excluding the person's primary residence. Levi Brackman, CEO and Founder of Invown, has created a portal where Real Estate operators post av...

Not every mortgage is held by a traditional bank. There are a number of extenuating circumstances where banks won’t make loans to solid borrowers so borrowers need to find other alternatives. In these cases, there are private money lenders who will make these loans. Retail investors who are looking for yield can invest with these lenders who make loans to the end borrower. In doing so, these retail investors get a conservative and attractive monthly return on their money. Pacific Private money, ...

Many people don’t know you can invest directly into a large cash-flowing apartment building without having to be involved with the operations of the property. Until the past few years and even more recently, several high-income earners were only aware of the stock market as a place to invest money. Thanks to Multifamily Real Estate experts like Bronson Hill of Bronson Equity, however, mainstream investors can participate in large Real Estate syndications by buying fractional shares of buildings ...

Not everyone that flips single family homes ends up flipping more than 3000 of them, and not everyone that gets into multifamily acquires over 7000 units within their first five years. Gideon Pfeffer, CEO and Managing Partner at the GSH Group, however, thinks big and has gotten unusual fast traction in the multifamily space, mostly in Michigan where he resides, since 2016. Gideon has built an in-house construction arm for value-add projects and has created a strong track record in acquiring and ...

Everyone has a plan, but rarely do things go exactly the way we expect them to go. In multifamily Real Estate, there are so many variables when it comes to financing, interest rate fluctuations, property management, capital structure and so much more. In today’s environment in particular, there’s less margin for error with contracting rents and occupancy, higher operating expenses, and more expensive debt. Vessi Kapoulian, a newer investor, has learned a ton about all facets of the acquisitions ...

After many years of a massive upward trajectory, multifamily real estate is facing headwinds, especially for older C and B class properties. In many markets, occupancy is starting to fall and rents along with it. In addition, many operators have taken on risky debt that they may not be able to service. As such, these operators may get into hot water in the upcoming months and be at jeopardy of having to sell their properties at a loss and lose their investor’s money. Jimmy Edwards, Owner and Dir...

Many operators specialize in a specific asset class, some operators specialize in a given geographic market, but invest across different asset classes. When you focus on one geographic area, it’s easier to build out a network of brokers and other contacts that consistently funnel you legitimate off-market deals where you can make real money. Rob Anderson, President at BV Capital in Dallas, invests in Texas. BV has done mostly multifamily where they’ve gotten very high returns for investors and i...

Interest rates are higher than anyone expected a year ago and they’re continuing to rise. As a result, many purchasers of multifamily properties with high leverage bridge debt will not be able to get the extensions on their loans they anticipated and will be forced to refinance at rates the properties can’t support without injecting more capital. At this point, they’ll have to reach out to their investors to request more capital or sell at a loss. Either way, the outlook is not good. Brian Burke...

The West Coast is home to several multifamily markets but it’s becoming more onerous to be a landlord in these markets as a result of increasing regulatory restrictions. That’s why Max Sharkansky, Managing Partner of Trion Properties, is diversifying from the West Coast into the Southeast where there continues to be big migration from other parts of the country as a result of job growth, low taxes, and flexible work-from-home employment options. Even though the U.S. economy is in a state of flux...

Taking a piece of land, envisioning a purpose for it, and bringing that vision to fruition is a large but exhilarating undertaking that also entails real risks. Even before you get the land entitled, you have to invest money in the zoning approval process, environmental studies, engineering feasibility, and other aspects that entail risk. Cowboy Joe Marquez has been involved in all stages of development from the initial evaluation of property to the final certificate of occupancy and everything ...

The biggest inhibitor to growing wealth is taxes. That’s why the best investing opportunity to-date is in Opportunity Zones where you can defer capital gains taxes plus avoid depreciation recapture, not to mention making great investments in transitioning neighborhoods with huge upside. Jimmy Atkinson, Founder of Opportunity Zone Database, created a database of over 300 Opportunity funds where investors can compare and choose different investment options when they’re coming out of a tax-deferred...

As interest rates have risen, prices have come down, sometimes significantly. Although sellers were initially reluctant to lower prices, they’re getting more realistic over time and concessions in the millions \ are being made on larger projects. Ryan Webster, Managing Partner of Equity Yield group, a multifamily operator with properties concentrated in the Florida Gold Coast, has been patiently making offers at prices that make sense for an investment that sellers are now responding to. The Gol...

90% of Alternative Investments are directly or indirectly placed in Real Estate. They can be great cash-flowing investments with high long-term appreciation. What they don’t provide is liquidity. You can’t get your money out whenever you want like a publicly traded stock. That’s why most financial advisors don’t recommend more than 20% of their client’s portfolios to be invested in alternative investments. Most advisors also don’t have as much knowledge of alternative investments as they do abou...

In the world of Real Estate finance, property owners can end up in arrears on their existing payments. In these cases their debt may be sold off to other lenders. In other cases, borrowers may not be able to obtain conventional financing for various reasons. In either of these cases, borrowers may wind up utilizing specialty lenders who help them solve their problems. Carson Rasmussen, Principal at Fairview Partners, lends money to borrowers who don’t have access to traditional banks. He buys no...

Even with the market changing with respect to debt challenges and interest rate increases, there’s still opportunities in the Value-Add apartment space long-term prosperity. As prices come down 10-15% and possibly even more over the next several months, there will be great opportunities to buy right and generate big value. The demand for rental housing persists, so the prognosis for multifamily buildings in the sunbelt and other growing markets remains viable. Chris Roberts, CEO – Founder of Ste...

Higher quality assets appreciate more in the long run, especially in supply constrained markets where it’s hard to build and there’s no more developable land. It’s simple, scarcity produces value. Even in recessions, quality construction assets hold their value better lesser assets in worse locations. Lior Rozhansky, Founder of Flora Capital, has pivoted from working class neighborhoods in Boston to multi-family in Class A neighborhoods as a pathway to “indestructible wealth.” It’s easier to man...