Old Capital Real Estate Investing Podcast With Michael Becker & Paul Peebles

Greg Willett- Chief Economist  RealPage RealPage is the leading provider of on-demand software solutions for the rental housing industry. RealPage supplies property management software to over 12,000 ownership groups that own or control over 30,000,000 residence units. They are the Facebook or Google in their industry. RealPage collects a tremendous amount of data on trends within rental housing throughout the country. Greg and his team analyze the up to the minute data. They are data miners. Greg believes that this strong rental cycle started in 2010 with huge demand. 2017 will still have great performance for the nation. Probable peak on annual rental revenue growth was in 2016. Golden age of apartments is now; but it is not realistic to expect for continuous sustainability. Rent growth is good at 3.5%. Developers are continuing to build apartments. They will deliver over 360,000 units nationally this year. Greg likes Sacramento, the Inland Empire in California, Las Vegas, Seattle, & DFW. Texas has 4 m

Always have a physical due diligence report done BEFORE you buy the property. Make sure that you understand the rental submarket and the tenant demographics. Rely upon the information from a qualified property management company that operates in the same submarket. Don’t over improve the asset too much for the submarket; if the market doesn’t recognize the improvement (pay you more rent) you could have thrown good money after a bad idea. Listen to Michael's thoughts

Chris Deuillett and Danny Baker Chris has been selling older (Class B & C) apartments in the Dallas market for 17 years. Chris comes from a family of real estate professionals; his two brothers and father are in the business. Danny is originally from Wisconsin and has been selling newer (Class A, A-, B+) apartments in the Dallas market for 7 years. CBRE is a Fortune 500 company that represents buyers and sellers of all different asset classes throughout the globe. In 2016, the Dallas CBRE office did over $1.5 billion in multifamily sales. Perspective: Chris is seeing a lot more buyers in the market with less inventory than last year. The biggest challenge today; too many buyers, not enough sellers. DFW market is one of the top markets in the country for rent growth & occupancy on already built apartments. The amount of new construction supply of apartments in Dallas is a concern, but not too big because the new construction does not really compete against older assets with lower rent costs for work f

What happens first; raise the investors money or find a building? Or is it vice versa? Before you do either, you must understand what it takes to be the managing member (responsible party) to operate an apartment building. Michael explains how a deal syndication works and being transparent with your investing partners.

In less than 10 months, Venkat and Ramana, purchased 3 apartment buildings in 3 different states with over 500 units, for $27 million. Now, they are hooked on buying apartments. Venkat is the IT Services business. Initially, he started buying single family homes. From 2007-2014, Venkat had purchased over 20 homes. He maxed out his ability to get long term Fannie Mae home loans and wanted to learn how to scale his real estate business. He found an apartment mentor that specifically taught multifamily investing. He then found a partner with Ramana in that same mentoring group. Ramana is the IT Services business for 13 years. He had done some investing in real estate, but on a limited basis.  First transaction was in Norman, Oklahoma. Second transaction was in Phoenix, Arizona. Third transaction was in Mesquite, Texas. Phoenix seller forced buyers (Venkat & Ramana) to use their local mortgage company. After 3 weeks, their mortgage company could not deliver. Buyers brought Old Capital into the transaction. O

70% of the lending decision is based on the building operations (historical and future) and 30% is based on the sponsor (liquidity, net worth, past ownership experience of apartments) Listen to Michael explain what’s important in apartment financing.

John Griggs, with Presidium Group in Dallas, owns over 10,000 apartment units. He co-founded the company in 2002. John and his business partner Cross Moceri, were unhappy lawyers in California when they got bit by the real estate bug. They first started buying, rehabbing, and selling single family homes and four-plex’s in California. They wanted to expand, and after looking into several markets throughout the country, John and Cross decided on investing in Dallas. 1000 units eventually became 5000 units in just a few years. Presidium stayed on the sidelines, during the recession. At first, Presidium started buying value added ‘C class’, now they are building large new apartments in good areas and still buying value added ‘B class.’ Tips: In a declining market, you don’t want to be the last guy to change your rent structure. You want to meet the market. Don’t keep your head in the sand; keep the building filled! Keep your property clean with good maintenance during a down turn. Buy and renovating apartments

A professional property management company can make or break your profitability and overall success to your apartment investment. Find a management group you can trust. A property management company should treat their clients money as their own.  Craig Lashley & Todd Parks are with SIMC Property Management. SIMC is a third party property management company that manages over 7500 apartment units. SIMC focuses on properties with a minimum size of 200+ unit apartments. SIMC likes to find employees outside of the apartment industry to join their team.  Property Management companies should have a few different divisions.  Example: 1) accounting, 2) human resources, 3) construction & rehab ACCOUNTING- is responsible for receiving rental income, paying the expenses and then delivering monthly financial statements to the ownership group. They are also responsible for lender communication for construction draws on rehab and the capital replacement reserves.  HUMAN RESOURCES- HR overseas the onsite property

The Old Capital team talk about interest rates rising at the end of 2016 and its direct impact on loan proceeds, future of apartment investing throughout Texas and the nation and challenges with underwriting on specific transactions. Old Capital closed over $420 million in loans in 2016. DFW will have over 25,000 new unit apartment deliveries for 2017 Still concerns in Houston and west Texas. Fannie Mae Green Program can reduce your interest rate up to 33 basis points  Challenges with buying apartments in smaller markets with military concentration Freddie Mac Small Balance loan is now available up to a $6 million loan amount Cross Collateralization can be a solution in bank financing  Rebuild Ability issues. Can property be rebuilt if more than 50% is destroyed in fire? Financing Challenges with environmental issues. Rent growth. Class A rent growth is slowing. Class B & C is much better.  Houston is a preview market with Fannie Mae and impact on financing apartments Focus on location and quality of the

In 2010, Aaron joined an apartment mentor program & learned about apartment syndication. Now he owns hundreds of units with his equity partners. Currently owns 3 apartment buildings: 200 unit Fair Meadows 150 unit Rock Island 340 unit La Jolla Terrace Sold 2 apartment buildings last year: 90 unit Pioneer Villas- Value Added 116 unit Casa Bella- Value Added His father emigrated from Russia and didn’t speak english. Father created the largest mattress discounters company in county. Aaron worked several years for his father and learned determination, tenacity and to follow one course to success.  Aaron faced many challenges on his first apartment transaction. His initial management company was not focused and had to be replaced immediately. Putting a transaction together is like putting a puzzle together.  Aaron discussed the genesis on his latest acquisition- La Jolla Terrace Apartments. Aaron had built a personal relationship with the listing agent for over the last 5 years. The property received over

Lane Beene and Jason Hull are heroes. Lane is a current US AIR FORCE- F16 pilot and owns apartments. Jason is a former NAVY SEAL and now finances apartments. Business is like combat and you need the right team members you can trust. Both owe their outstanding military success to being able to count on good teammates. Things you will learn: Jason: Every day is a game day. Going through BUDS, Jason never thought he would ring the bell to quit. 16 people in a SEAL TEAM and everyone has a role and a responsibility. As a team leader…”calm is very contagious.” You will never have the perfect plan…but you must make a decision and work with your team. Lane: Every mission is important and all teammates play critical roles. No tolerance for mistakes. Surround yourself with teammates with high creditability and capability. Rely upon the whole team, not just one individual. America is still the land of opportunity, don’t forget that we live in the best country. To grow, you must rely on other people. To receive our FREE

Want to learn how to get started in Syndicating Multifamily (Apartment) Properties? This week on the Old Capital Real Estate Investing Podcast we interview Robert Helms, the popular host of the Real Estate Guys Radio Show. We discuss Robert's background and how he got started syndicating real estate deals. Later, we talk about how Robert has interviewed many famous real estate icons including Rich Dad Poor Dad author Robert Kiyosaki, legendary sales trainer Tom Hopkins, Successful Real Estate Syndication Expert Ken McElroy as well as President Donald Trump, twice!! For more information about the Real Estate Guys upcoming events The Secrets of Successful Syndication and the 15th Annual Investor Summit at Sea...please send an email to ocpodcast@realestateradio.com Interested in learning more about how Multifamily Financing works? Please visit us at www.oldcapitalpodcast.com. There you can receive a copy of our 15-page white paper report titled "Fundamentals of Multifamily Financing" and to learn more about upco

After being passive investors in over 900 apartment units; Greg & Nicole Scott decided to purchase their first apartment building in an area that they know best...Detroit, Michigan. Listen to how these investors overcame challenges in making this investment a success.

We start 2017 with a discussion with the top producing team of ARA- Dallas. ARA has the largest brokerage platform in the nation. Listen to what’s in store for multifamily in the primary and secondary markets of Texas for 2107.