Results for ‘Due Diligence’ category

Walking away from a potential homerun

Just walked away from a really nice deal and I’m still in mourning. Last week, we were offered the opportunity to buy a group of smaller buildings in a single portfolio, off market, through a broker with whom we’ve done business before. The numbers looked good and even got a little better after inspection. I

A really scary roof deck

Came across a listing for a renovated building yesterday that made me very scared for the potential new owner. To be clear, this was a nicely renovated building, with brand new systems, high-quality finishes, decent taste, etc. And the rents were pretty good – around $2500 for 2 beds with no parking, which, for the

When liquidity dries up for supposedly liquid funds

When people invest with us, I always warn them not to expect their money back at any particular time. Why? Because real estate is a fundamentally illiquid asset (eg it takes a long time to sell). As long as you’re not a forced seller, you’l probably do very well… but you can get killed if

Why people pay high prices

Had someone yesterday email me asking why I think people are paying insane prices for Los Angeles apartment buildings. By insane, I mean 15-19x annual rents. At those prices, there’s basically no cashflow; in fact, at the upper end of the range, it’s likely you’ll pay to own the asset each month (instead of the

What chutzpah!

Have been following a listing in Highland Park for a little while and wanted to share it with you all.* It’s a decent-size deal in a good area at a somewhat reasonable price. So, what’s the big deal? If you dig into the listing info, you will see that the building has an underground parking area, which is

Page 1 of 912345...Last »