Multifamily Legacy Podcast

Welcome to the multifamily apartments investing podcast, I am your host Corey Peterson. Today, we are talking about how to analyze deals. The key to a successful apartment deal is understanding how to make sense of the numbers. This is the third part of the six pillars of success series. You need to know when a deal is a good deal and with multifamily apartment investing it is all about the numbers. Putting the numbers into the right system will tell you when a deal is worthwhile or not.   Having the right software will make the process a whole lot easier. I’m in the process of creating a Kahuna Underwriting Template. As of the time of this recording it is not available, but it will be soon. I’m taking all of the best of the things that I use and throwing out the things I don’t like about the current systems I use. This is going to be a really great product. Today, I’m giving you a 50,000 foot level view of what makes a deal a deal. Starting with two types of deals the momentum play and a repositioning play. Keep in mind the ultimate goal in each one is always cash flow.   Topics on Today’s Episode:   Momentum play or buying a deal that is already doing well, making it a bit better, and carrying on the momentum Micro positioning or improving the apartments a little bit with landscaping or other things These properties can cash flow the day you buy them and they provide safety Repositioning play or doing a very big rehab this can have lot’s of turnover This requires lot’s of cash, but can make a lot of money A repositioning play involves more risk An example of a momentum play deal with 80% leverage 80% leverage means getting a loan at 80% LTV and putting 20% down Property packet and the financial numbers What their numbers are - compared to what you think they should be Gross potential rents - total number of rents that you could collect Vacancy - percentage of units not rented - determine in dollar amount Total concessions like $100 off first month’s rent Total rental income Other income - coin operated washers, vending machines, etc Residential utility bill backs or RUBs are income Total income - all of the income the property generates in a year Operating expenses - Salaries, advertising, maintenance, office admin, management fees, utilities, insurance, and taxes. Deduct operating expenses from the total income and you get net operating income or NOI Deduct your loan or debt service and reserve account from the NOI CFBT or Cash Flow Before Taxes - you want the biggest amount you can get going into your account Taking the time to vet a great property manager who has great systems in place Getting your feet wet with a nice solid momentum play   Links and Resources Mentioned:   Quickstart Workshop Quotes:   “Cash flow is really what it is all about and what should drive you in all of your decision making in this process.” Corey Peterson   “The biggest expense you have on any property is the payroll of the people who work for your property.” Corey Peterson   “If utilities such as water are abnormally high, look at things like leaky toilets. They are literally throwing money down the drain.” Corey Peterson   Don’t forget to download my Free Workshop Quickstart Video Series, and if you like what you have heard please leave a review on iTunes. On the next episode, I am going to give a quick shout out to some of my reviewers.  

Welcome to the multifamily apartments investing podcast, I am your host Corey Peterson. I have a great show lined up for episode 3. It’s my goal for you to get excited about multifamily investing because the right deal can set you up for life. Last episode, I talked about the secret language of apartments. We discussed things like cap rates and buying for cash flow. In this episode, I’m talking about the secret to finding great apartment deals. This is the second part of my six pillars to apartment investing series. One method for finding properties is sending direct mail to apartment owners. This is effective for smaller units. Larger units of 100 plus units usually only sell through brokers. A plus of buying smaller units is not having a broker involved. There are also more options for creative finance when dealing directly with the owner. Broker relations are another way to find deals. This means establishing the markets that you like and getting to know the brokers that work in that area. They will send you deals in that market creating a nice pipeline. The best technique is to use both methods and understand how to properly analyze the deals that you find. We will be talking about analyzing deals in the next episode or the third part of the six pillar series. Today, we focus on the process of finding deals and having the right deal flow.   Topics on Today’s Episode: The direct mail route or sending letters straight to the owners of properties This route is very efficient for finding motivated sellers Having established relationships with broker in your market is another way to find deals Use ListSource to find properties in the MSA or area you are interested in Look for properties built between the 70s and 90s to find B and C properties Choose multifamily residential apartments for the type of property Send something in a colored envelope that looks like a handwritten card Use strong copy and a phone number for a call to action Set up a phone number for each market to appear local and track and record Import the calls to Podio for project management Getting information from an owner who calls such as a current rent roll Getting 3 months trailing P&L, but a 12 month is preferred How 1 person in 25 calls is usually motivated Determine your market to target brokers in your area Use LoopNet to find the brokers in my market Choose at least 50 units for larger units Call the broker and be confident You can make practice broker calls in a market that is not your target market You are a looking for a value add opportunity with a big upside, or a momentum play Build rapport with the broker. What do you do for fun? Put it in your notes. Forward thinking upgrades like updated plugins with USB charger ports To build relationships you need to know about their family and likes   Links and Resources Mentioned: Quickstart Workshop ListSource CallRail Podio LoopNet Don’t forget to download my Free Workshop Quickstart Video Series, and if you like what you have heard please leave a review on iTunes. On the next episode, I am going to give a quick shout out to some of my reviewers.  

If you are here listening to this podcast, you are probably tired of flipping properties each and every month. I am so excited that you are here, and I am so excited to help you think a little bit bigger and focus on multifamily apartment buildings. For me, the shift came when I asked, “how can I own apartment buildings?” I am here to help you make that mindset shift that will help you to think bigger and to invest bigger. I’m also going to be sharing a lot of secret techniques with you. In the last episode, I talked about the big picture, I shared my story, and we talked about why you should invest in apartments and the three ways to get paid when investing in apartments. The first episodes of these podcasts are going to be pillar podcasts. There are really six secret pillars for cash flowing apartments. In future episodes, I’ll be talking about the secrets of finding apartment deals, analyzing apartment deals to make money, making offers, funding deals, and how to become a great operator. Today, I am going to talk about discovering the secret language of apartments. Topics on Today’s Episode: The six secret pillars for cash flowing apartments ABCs of buildings and grading apartments Newer apartments with a lot of amenities are developer and REIT games Properties built in the 80s and 90s are B properties C properties built in the late 60s and 70s - no washer dryer hookups D properties are the war zone, where you don’t want to go at night Making money with B and C properties and doing discovery to find them Areas are graded A, B, C and D or the war zone areas Market cycles and being mindful of current cycles Apartments are based on cash - flow not appreciation Looking for the best opportunity to make good money and finding emerging markets Buying and holding for 3 to 5 years or forever and selling at the peak of the market Capitalization rate and buying at a high cap rate Managing expenses and having consistent income Looking for deals at a good return, making improvements, and making value Links and Resources Mentioned: Free Quickstart Workshop Don’t forget to download my Free Workshop Quickstart Video Series, and if you like what you have heard please leave a review on iTunes. On the next episode, I am going to give a quick shout out to some of my reviewers.  

Welcome to the multifamily apartments investing podcast, I am your host Corey Peterson. I am so excited to launch this podcast because it is going to do amazing things for people. I believe that what we do is done for sunsets and palm trees. We want to create the life we dream of, and we do that through apartments and cash flow. This podcast is for anyone who is tired of doing single family flips and doing it each and every year. The power of cash flow and the vehicle of apartment investing has changed my life radically. Being in the apartment industry has been a great and inspiring journey. I just want you to know that you can buy these amazing assets and create a wealth like you have never known. Before I get into the main episode, go download my free video series that shows you how to get started in apartment investing using other people’s money. Today, I am going to share who I am and what my story is. First off, I am a country boy at heart who grew up in West Plains, Missouri. I grew up on a farm, and I am quite proud of that upbringing because it made me the man and the investor that I am today. Out of High School I didn’t have any direction. I also didn’t have a degree, so I became a car salesman. I learned a lot about selling, but my future wife didn’t want to marry a car salesman. I called in all of the favors I could and ended up becoming a restaurant manager. I then dabbled in restaurant sales. Before I got married, my mom invited me and my fiance to Hawaii. The trip was beautiful, amazing, and eye opening. Bruce, my stepdad, had a magical house in Hawaii. His house was on a cove that had a freshwater stream running into the ocean. He had the house, the cars, and the life. When I asked him what he did he said real estate. This was the beginning of my lifelong love of the potential and power of real estate investing. Topics on Today’s Episode: How I grew up in the Ozarks like the ones in Deliverance The 5 years that I spent selling cars really taught me how to sell and communicate How I went from selling stuff to managing stuff and what I learned in the process A trip to Hawaii had a profound effect on my future and opened my eyes to the power of real estate Bruce was a real estate investor in multifamily properties with cash flow Starting with the dream as my goal and opening Kahuna Investments Being a financial advisor for Edward Jones and my commitment story How the best time to jump into real estate is at the bottom Wrestling with the man in the mirror The high stakes for the level of commitment I made Searching for a real life mentor and taking massive action Meeting Bob Norton by accident and wholesaling Finding OPM other people’s money Letting investors self select and asking who they know How private money opened the opportunity for multiple deals Funding my first apartment deal that I still own today How there are multiple ways to get paid with apartments Links and Resources Mentioned: Free Workshop Quickstart Video Series Rich Dad Poor Dad Bob Norton The Secret