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Alternate Lending for Multifamily Investors

Today we talk with Ken Avalos, VP of Electra Capital, about alternative lending with a focus on multifamily financing solutions. Alternative lending is a great option when traditional lenders are unable to meet an investor’s needs. The benefit of an alternate loan is more leverage (which means you put in less capital), speed, and the flexibility and creativity to work around odd structures and difficult issues. Depending on your situation, this can potentially allow you a greater rate of return.

Most investors use traditional lenders like Fannie and Freddie, or use a traditional community bank – all of which typically offers low cost and long term fixed rate financing. However, these traditional lenders will usually at best give you 65%-70% leverage, and their underwriting criteria is fairly strict. And in today’s world of 3%-5% cap rates, it’s hard to generate a decent internal rate of return.

Key Discussion Points

[00:57] Opening remarks by Eric Odum & Steven Silverman

[03:31] About our guest: Ken Avalos

[04:56] How did you get into real estate and finance?

[09:35] Do you think the Florida market is overheated?

[14:50] Are you monitoring the rent to household income, and what are you seeing?

[17:13] Explain about your alternative financing services

[26:14] Does the bridge loan convert into a permant loan at the end of 3 years?

[27:44] What deal size is attractive for your loan service?

[28:42] Do you mainly loan to multifamily? Or do you also look at other asset classes?

[30:03] Tell us about Mezzanine Debt vs. Preferred Equity as it relates to your product

[42:09] How can folks reach you?

[43:20] Closing comments by Eric & Steven

About our Guest

Ken-WEB

Ken Avalos is the VP of underwriting and analysis at Electra Capital. He is a graduate of Boston college, and has an M.B.A. from the Stern School of business.

CONTACT INFO

website: electracapital.com

email: ken@electracapital.com

Multifamily Investing

The multifamily market is hot everywhere, but especially in Florida, and it can be difficult to find good deals with the current cap rate situation and fierce competition. Today we talk with Vehano Joseph about his strategies to finding good multifamily deals in Florida.

Key Discussion Points

[00:58] Opening remarks by Eric Odum & Steven Silverman

[03:38] About our guest: Vehano Joseph

[05:40] What’s your background and how did you get into real estate?

[10:26] What do you look for in acquiring a property?

[12:46] What parts of Florida do you like and dislike for real estate?

[17:14] What cap rates are you seeing that enable you to acquire properties?

[19:24] Tell us about your syndication deals, and any tips you can provide

[21:08] Where do you investors come from? Mostly U.S.?

[22:06] Do you farm out your property management?

[23:44] Moving forward, is your strategy to go into more of the urban tupe environments?

[25:08] Do you investors invest in the portfolio or in individual assets?

[26:15] Are you utilizing brokers?

[28:20] How do you get brokers to pay attention to you?

[33:26] How can folks reach you?

[35:05] Closing comments by Eric & Steven

About our Guest

Vehano Joseph is the Chief Executive Officer and Co-founder of Dreamstone Investments, a rapidly growing multifamily investment firm with bases in Atlanta and Tampa.

Vehano and his team specialize in adding value to properties by putting “the Dreamstone touch” on unit interiors and exteriors, adding functional and aesthetic features that ensure value for investors while also creating appealing, affordable, family-friendly spaces that attract and retain residents over time. Under his leadership, Dreamstone has moved from emerging to an established player in the multifamily space.

CONTACT INFO

website: dreamstoneinvest.com

email: info@dreamstoneinvest.com

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