** Exaggerated, but Useful **

Real estate literature is a questionable genre. Many syndicators realize that thought leadership is essential to deal flow, and the shortcut to thought leadership is authorship. Thus the surfeit of low-quality limited-run real estate books and e-books. These tomes were never meant to be well-written, rather they simply exist as a bullet on the resume of the author. So it is with no small amount of trepidation that I approach ‘Best Ever’. Yet to my surprise there was enough information to break through its brotastic tone and justify publication.

Useful elements of the book are presented in immutable rules. For example, a real estate investor should look at 100 deals to evaluate 30 to make 10 offers to 1 purchase, known as the 100/30/10/1 rule, In the last year I’ve looked at hundreds of deals to evaluate 46, make 14 offers, and find 6 purchases. This makes me think that the rule is like a useful abstraction for appropriate deal funnel metrics. In another example, the path to guaranteed success is the 3 immutable laws of real estate investing such that If you stick to these laws of real estate investing, your portfolio will not only survive, it will thrive in any market. The rules are:

  1. Buy for cashflow on value add properties
  2. Debt secured should have a loan term longer than the hold period.
  3. Have adequate cash reserves. Create operating account fund: 1-5% of purchase price, and reserve account of $250/unit/year

Again this is worthwhile shorthand, but hardly enough to ensure success in any market. Fairless studiously avoids quantitative analysis, and refers to even the most basic modeling with the following disclaimer: Grab a fanny pack and your favorite pair of suspenders because it’s time to NERD OUT. . Yet there are just enough frameworks and threads to pull on the softer side of successful apartment syndication that this ‘Best Ever’ is the most useful real estate book that I’ve read in the last few years. Maybe someday I’ll even write a low-quality limited-run real estate book of my own.

**Notes **

∙Annual reports worth reading:

  1. Marcus + Millichap Annual Multifamily investment forecast.
  2. CBRE Biannual cap rate survey
  3. Integra Realty Resources (IRR)
  4. Zillow annual consumer house trends report
  5. RCLCO Quarterly Analysis of the real estate market
  6. PWC Annual Emerging trends in real estate.

∙Mentor: www.besteveraptprogram.com mentor syndication program. ∙Offer the real estate broker a consulting fee. Show that you are serious and respect their time. ∙4 levels of alignment of interest with investors:

  1. Participates in the deal
  2. Provide them with equity in the property
  3. Small piece of equity and they invest their own equity
  4. They bring on their own passive investors in the deal

∙Ways to upfront the loan guarantor: Non-recourse: Typical fee is 0.5%-2% of the principle balance paid at close. 3.5% - 5% for recourse loans. Alternatively, can offer an equity stake of the deal - 5-30% of the partnership. ∙Amenities checklist

  1. New cabinet doors.
  2. Granite countersz
  3. Black appliances
  4. Microwave
  5. Vinyl flooring
  6. Modernized fireplace
  7. New paint
  8. Tile backsplash
  9. Washer and dryer in the unit
  10. New light fixtures
  11. New plumbing fixtures
  12. 2 inch blinds
  13. Carport
  14. Patio