NYC RE Development Manager

Allow me to introduce myself. Currently a NYC based development manager building institutional assets. Here to connect with others and discuss all things real estate and development related. Will be sharing thoughts I find interesting along the way.

@GenZMultifamily What type of opex load does something like this run? I imagine this old deferred maintenance and R&M up the wazoo? But happy to be proven wrong!

All you have to do is buy a building like this and raise everyone's rent 50%. Repeat that 5 times and you'll be retired. Why aren't more people doing this? Follow for more passive income tips.

@MJRSelfstorage @PerrySolem What did you pay? And how much in revenue is to doing now? Tiertiary market? Secondary? Primary?

@PerrySolem Way over paid but I knew that going in! Ha. Its been a great addition for me and demand has been excellent. Its still probably worth less than I paid for it but has a lot of growth left.

One year in, tomorrow. Crazy how fast a year goes. We are having fun with this one!

@PerrySolem Interesting.

something i didn't see coming: big box industrial vacancies getting bailed out by datacenter vendors. all over the place.

@Bay2WallCRE Would ask broker if there is an ESA. A good broker will make sure there is one upfront. Or you get U/C and do ESA first. Buy all cash eliminates much carry costs. Refi in 12 - 24 months. Low entry price alllws for this

Thanks for making it this far and let me know if you have any questions.

Day 229 of posting a deal a day until I get a new role in CRE Investments / Value Add / Special Situations🧵 Didn't expect yesterday's post to blow up. Will post another intro soon. Today I am back looking at the Cleveland flex industrial market to try and find my first deal

@robbiehendricks @jbrooksokc Generally speaking what % of your deal overall returns at acquisition are attributable to exit vs cash flow? Do you guys look at this metric? In my ten years of investing, even when I worked at a core fund, mkts were so hot that exit was doing the majority of work for returns.

@jbrooksokc Exit-dependent deals are scary. Pretty big "hope" strategy. Thanks for the kind words brother.

Finished the quarter at an average 8.1% cash on cash for our stabilized portfolio. Slightly lower than we'd hoped, but not surprising given we ran some one month concessions on some of the properties. As the concessions burn off, I'd expect a better Q3. Onward.

@rohde88 It’s crazy how many people don’t do a phase 1 thinking they are saving money. $1500 to save you a bill you can’t afford..

Phase 1 environmental on industrial land is not optional. It's your protection against inheriting someone else's contamination liability. If the Phase 1 flags anything, get the Phase 2. The cost of being wrong is not a number you want to find out after closing.

@Storage_Venture Thanks! Means a lot!

@REDevManager you're doing all the right things!!

Everyone waiting to feel "ready" to buy their first facility: You never will. The guy with 100 facilities doesn't feel ready either. Confidence is a goalpost that moves every time you get close to it. Stop waiting to feel ready. Start taking messy, consistent action.

@Bay2WallCRE What are you typing into Facebook market place to find comps?

final thoughts - I still need to review the best way to financial engineer the entry... likely will need a massive lowball or seller financing of sort, but am starting to undestand the asset a bit better - let me know your thoughts

Day 228 of posting a deal every day until I get a new role Today I am stress testing some assumptions, digging into my implementation plan, and finding actual comps to justify my underwriting

@Bay2WallCRE Throw your offer in at $275K. You never know what’ll happen

final thoughts - there might be something here if you go in for around 275-300k - or you give them the 425k on like 80% LTV seller financing 2% interest or something - but there just isn't enough meat on the bones here at the current price - will keep an eye out and keep chatting with the broker and try to see what is realistic... but just seems like too much work for not enough returns BUT there is no doubt that this would be leased and never vacant

Day 227 of posting a deal a day until I get a new role Today I am looking into the flex industrial market in the greater Cleveland area Arleady talked to some brokers, but the key issue seems to be finding deals at a good price Here is the deal I looked at and why I can't do the deal.

@ChuckBuc2 Awesome

@REDevManager Cold call but was apparently on market before I called and picked it up about a few hundred K below last offer that didn’t work out

Newest self storage acquisition has had 26 move ins this month. Still a ways to go but thrilled with the start.

@GenZMultifamily Landlord unless your lease states otherwise.

A tenant moves in and 3 months later they break the seat on a brand new toilet. They let you know and ask if you can fix it. Who pays, the tenant or the landlord?

@rahbar_rod @Bay2WallCRE Lease up time is sub market dependent. If I had class A space next to grand central in NYC I could lease it for $170-200/sf with no issues today. If you put it downtown it won’t move. There are rumors that we will have a $400/SF lease in NYC shortly.

@Bay2WallCRE Office value add needs to price in a much longer lease up runway than it did pre 2020. The 10-14 IRR on a 5 year hold feels aggressive unless you have anchor tenants already committed before you close.

what are institutional office value-add required returns? I am going off like 14-18 irr 7 year hold? feels like too much? Thinking like 10-14% 5 year irr? Not a lot of capex but high lease up costs in years 1-3

@ChuckBuc2 How’s this working for you?

Getting real value out of AI today Built a Zapier flow that auto texts my off-market owner list (all done by asking GPT) Google Sheets List → Text via Quo → e-mail to me if I get a response What used to be manual calling is now texted quarterly Lets see if I get deal flow🙏

@ChuckBuc2 Awesome. You find this via a cold call? Or brokered process? Crazy to be in a good college market and have such bad customer service.

@REDevManager They had no ads, a super dated Google business page with reviews, missed phone calls, only 5 days a week, and a lot of deferred maintenance

@AjOsborne1 Promotes get you rich but so do the operating companies the developers / operators build which create the recurring fee income. This is the platform that is valuable and saleable.

The richest real estate investors aren’t investors at all. They’re operators who own assets. Deals make you money once. A business makes you money forever.

@RandallHouseRE Great points. Cash on cash is great but you need appreciation to create wealth

Typically easier to work an assets value up and return your capital to yourself quicker. Debt market to refinance is still also much stronger for apts. Most flex deals I see the cash on cash is great, but unless your deploying serious cash you are better off focusing on returning your equity faster

A lot of attention is on industrial and flex right now. I love the asset class and have accumulated 75,000+ SF myself. But when it comes to velocity of capital, multifamily is still the bread and butter. If you’re a young operator looking to compound quickly, I’d still focus on finding great multifamily deals.

@Bay2WallCRE Raising equity right now for value add office in a great location. Equity groups demanding a 9% yield on cost with good cashflow and aiming for a 25% gross IRR. Pretty insane but that’s the feedback we’ve gotten. Most in office right now are opportunistic funds