Results for ‘Buying’ category

Navigating a hot market by raising cheaper capital

Two days ago, I wrote about how hot the apartment market has got and promised to talk about how we, and others, are navigating it. Yesterday, I discussed a tactic that kind of works right now, though we can’t use it. Today I want to talk about another way to approach this hot market: By

An effective tactic we just can’t use

Yesterday, I noted that pricing for apartment buildings in LA has become detached from the underlying cashflows the buildings can generate. But some deals are still getting done at (semi-)reasonable prices and I want to discuss how, and why it’s a problem for me. Right now, listing brokers and sellers are pricing properties very aggressively.

Buyers beware

The math underlying the apartment repositioning business is simple: It comes down to the relationship between the price at which we can buy buildings and the rent we can achieve for renovated units. Because we started doing this pretty much at the bottom of the last recession, for our entire career, both prices and rents

Who passes on a 7% unlevered deal?

We just cancelled escrow on a deal that I thought was pretty likely to end up a 7% unlevered return. How do you pass up a deal like that, particularly in this market? I know this is going to sound crazy to long-time readers, but, sometimes, it’s not about the numbers. On this particular deal,

Heading to RealShare tomorrow

Tomorrow, am headed to RealShare, which is the premier LA multifamily event. Why?   A huge part of doing deals is having the relationships necessary to get your offer picked¬†over others’. Those relationships generally get created during deals. The more you close, and the better you behave, the more brokers like you. But it’s easy

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