Buying an apartment building

[DianneDachyshyn]

We would like to buy an apartment building (11 suites) and we are wondering how to approach a JV deal for such a property. Is it the same as any other JV deal in that they provide the capital, we provide the Real Estate expertise and we share 50/50 in the equity and cashflow, or is there a different way to approach it?

What can we expect to pay for Property Management? Would it be less than 10% for multi-family?

Lastly, if we use private money instead of JV partners, what is a fair rate of interest?

Thanks,
Dianne

 

[DonCampbell]

Hi,

All of my JV`s on Multi-Family properties are on a 50 - 50 basis. No wavering because what you bring as the `real estate expert` is as important if not more important than the silent money partner.

It all depends on where you are buying (geographically), you can expect about 5% as Property management for a building of the size you are looking at.

Private money is a good option if you have the cash-flow from the property to pay for it. Make sure you factor that in when completing your Multi-Family Property Analyzer form (availalbe to REIN Members in the Members Critical Forms Section of this site)

Trust this helps. You should also consider being at the optional Condo Conversion event coming up in April. (check out the calendar on this site) or the live link above.

 

[DianneDachyshyn]

QUOTE (DonCampbell @ Mar 14 2008, 09:44 PM) Hi,

All of my JV`s on Multi-Family properties are on a 50 - 50 basis. No wavering because what you bring as the `real estate expert` is as important if not more important than the silent money partner.

It all depends on where you are buying (geographically), you can expect about 5% as Property management for a building of the size you are looking at.

Private money is a good option if you have the cash-flow from the property to pay for it. Make sure you factor that in when completing your Multi-Family Property Analyzer form (availalbe to REIN Members in the Members Critical Forms Section of this site)

Trust this helps. You should also consider being at the optional Condo Conversion event coming up in April. (check out the calendar on this site) or the live link above.

Thanks, Don!