Tag Archives: financing

Ep. 105 Kurt Westfield: A Journey from Single Family to Multifamily Investing

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multifamily investingMost real estate investors starting out will try their hand at single family investing first. Single family properties are familiar, small-scale and generally easy to tackle for first-time investors.

However, many investors will find they have a limited ceiling for growth with single family properties. Juggling dozens of single family properties while actively marketing for new investments no longer becomes practical. Apart from wholesaling, flipping and other similar single family markets, the next logical step for many investors is to make the move to multifamily investing.

Multifamily investing may be intimidating to some, but while it is a different ball-game than single family, the two do share a few commonalities and the overall benefit of multifamily investing outweighs the risk.

Just ask Kurt Westfield.

Kurt moved to Florida from New York and, in 2008, co-founded an investment partnership, WC Equity Group. They then entered into Tampa’s single family investment market.

After doing 102 single family deals in his first two years, Kurt new it was time to make a change if he wanted to scale his investment growth.

Kurt turned to multifamily investing and has since expanded to also offer lending, management and syndication services under his umbrella firm, WC Companies. In addition to Tampa, WC Equity Group also has properties in Jacksonville, FL and Cleveland, OH.

Check out Kurt’s story going from single family to multifamily investing and what he learned along the way!

Tools for Multifamily Investing

  • Market Timing
    • Understand where market could go, not where it is.
  • Fringe Markets
    • Areas on edge of of hot market’s outward growth, i.e. markets around South Tampa
    • Similar tenant quality to class-a markets, better price points
    • Gentrification/community redevelopment occurring
    • Value-add opportunity
  • Network
    • Working relationships with brokers
    • Like-minded investor base
    • Reliable team of contractors/sub-contractors
  • Responsiveness
    • Be prompt and responsive for potential investment deals. Assure potential investors of trust-worthiness.
  • Mentors/Inspiration

Kurt is always interested in working with bright, like-minded investors and brokers to expand his network in multifamily investing.

To contact Kurt with potential deals or to find out about the services his companies offer, visit www.wccompanies.com, click on any company tab and find the contact section.

Check out their Facebook Page!

 

 

Ep. 76 Richard Wilson: Family Offices Can Be An Important Source for Deals and Financial Partners. Find Out HOW!

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AAEAAQAAAAAAAAl8AAAAJDY2NGU0MmU2LTI2NTctNGViYi1hMWY1LWMzZTUyOGVlY2EzNAFamily offices are becoming a burgeoning industry in terms of real estate investment and financing. Wealthy families are increasingly looking towards commercial real estate as a stable, generating market to channel and secure funds. Florida real estate markets are poised to receive family office investments and financing, but there is one problem: how can an investor find family offices?

Richard Wilson is founder and CEO of Miami Family Office, a $500 million AUM single family office. Through his company, Wilson Holding Company, Richard also oversees and advises on several other family office business enterprises including Billionaire Family Office and the membership-driven Family Office Club. Through his companies, Richard owns, manages, markets and facilitates family offices. This episode Richard discusses how commercial real estate investors can access family offices as a source for deals and financing.

  • Network and market towards family offices
    • Networking through social media
    • Narrow search: source for certain deal-types
    • Compile list of family offices in your area, find out what propoerty-types they are investing in
  • Actionable Investments
    • Family offices look for credible, practical deals as investments
    • Most family offices like to invest locally
    • Good cap rates: properties earning 15-17% IRR
  • Family offices looking for investors
    • Put out property mandate alerts for certain desired investments
    • Will reach out directly to investors

If you think you have an actionable family office investment deal, contact Richard at richard@familyoffices.com

To find out more about Richard’s family office portfolios, visit www.miamifamilyoffices.com or www.detroitfamilyoffices.com and check out Richard’s family office webinars. Richard also hosts a informational podcast about family offices. Visit familyofficepodcast.com for past shows and to stay up-to-date.

Richard’s book, The Single Family Office: Creating Operating and Managing the Investments of a Single Family Office, is a best-seller in the family office industry and the key for investors wanting to find out more about the market. You can find his book on Amazon!

 

Ep. 70 Livingston Hessam: You Will Want to Hear What Is Happening With Mortgages!

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Livingston-Hessam_jpgThe coming year is looking to be an eventful period for mortgages and financial lending in real estate. Debt markets are poised to undergo significant changes over the following years amidst regulatory changes and geo-political headwinds. Investors, both seasoned and novice, should be aware of the changes and the effects they could have on current and future mortgages.

Livingston Hessam, Vice President of financial solutions firm Walker & Dunlop and financing expert, discusses these changes in the debt markets and what investors need to know about their impacts on mortgages and other debt-equity options.

  • 2016 Mortgage Bankers Association Conference
    • Annual conference gauges financing market for coming year
    • Mixed outlook for 2016
    • Multi-family holds strongest appetite for lenders
  • Debt Categories
    1. Agency Debt – Fannie Mae / Freddie Mac
      1. Conventional rates, senior housing, student housing, manufactured housing
      2. High-leverage, non-recourse, cap limits
      3. Reached 2015 cap before end of year
      4. Introducing smaller deal offerings ($1-5 million) – lower upfront closing costs, for typically novice borrowers, not included in annual cap limit, do not require same level of eligibility requirements
      5. Only can acquired through authorized servicers/lenders
    2. CMBS Markets (Commercial Mortgage-Backed Securities) – Loans sold by banks into secondary markets
      1. Amid current CMBS 10 year maturity loans wave
      2. Several regulations coming into effect causing uncertainty: Risk Retention (Dec. 2016) – Req. CMBS issuers to hold 5% of loan to securitize deal
      3. Investors and lenders advised to close deals in first half of year
    3. Life-Insurance Company Loans
      1. Typical deal – sub-70% leverage, non-recourse, strong exp. sponsor, well stabilized market
      2. Positive lending outlook for 2016
    4. Conventional Lending (Banks)
      1. Regulatory changes: Dodd-Frank Act
    5. Alt. Lending
      1. Walker & Dunlop offers bridge-lending packages
      2. Good for investors with assets not ready for perm. agency lending
      3. Up to 80% of cost for pre-stabilized deal or value-add deal, up to 36 months, help re-sell or re-finance
      4. For multi-family, student housing, manufactured housing, independent & assisted living, and skilled nursing

Livingston kindly provided us with a detailed, corporate overview package for Walker & Dunlop, further describing the financial solutions they offer as well as contact information.

Corporate Overview 2.22.16

 

 

Ep. 58 Jefferson Lilly – Things You Should Know About Syndicating Real Estate

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361ee06A big concern for new real estate investors is the question of how to raise financing and build capital. Many investors are intimidated by traditional methods; using institutional debt-equity options and financing. Many who are hesitant about financing are unaware of alternative financing options. We have discussed alternative financing previously on the show, but this episode focuses on a specific method: syndicating real estate.

Jefferson Lilly also has a special focus when it comes to real estate investing. Jefferson specializes exclusively in mobile-home park property markets. Through his own company, Lilly & Company as well as through his co-partnership with Park Street Partners, Jefferson owns and manages 10 mobile-home parks from Wyoming to Ohio. Park Street Partners specializes in syndicating real estate deals, operating through a registered blind fund as opposed to raising financing through singular deals.

Things to Know About Syndicating Real Estate:

  • “Fundraising takes a life of its own”
    • Reputation and word-of-mouth marketing produces a snowball effect in syndicating real estate
    • More successfully executed deals translates to a greater willingness from investors to devote capital
  • Costs
    • Roughly $7500 to establish offering memorandum template in syndicating
    • Roughly equivalent in legal costs per deal for one-off financing
  • Syndicating
    • Blind funds- investors pool capital and allow broker/agent to make executive investment decisions
    • Largely adaptive to outsourcing options for financing and fundraising
    • Investors may conduct due diligence on broker/agents existing transaction records
  • Stipulations to Syndicating Real Estate
    • SEC requires strict operating stipulations for funds
    • Accredited investors permitted only
      • Private net-worth of $1,000,000 excluding home
      • Annual income of $200,000 (Individual)
      • Annual income of $300,000 (Married)
  • Advice
    • Due diligence is key
    • Generate customized contracts, tailored to specific investment goals
    • Provide enough time for both parties to process deal requirements
    • Seek guidance from a mentor

Jefferson Lilly got his start just like any other investor. He sought tools and resources to become informed in his market type. Some of Jefferson’s key mentors and resources are:

www.mobilehomeuniversity.com

and

George Allen – Mobile-home park industry specialist, author of How to Find, Buy, Manage and Sell a Manufactured Home Community

To contact Jefferson with any questions regarding mobile-home park investing or syndicating real estate, contact him by email at jefferson@parkstreetpartners.net

For any other Investment opportunities with Jefferson’s company, join the mailing list on the company’s website: www.parkstreetpartners.com or join the LinkedIn group: Mobile Home Park Investors