On Friday, had a funny discussion with our largest investor regarding the value of parking spaces. His joke was that, when I’ve got loads of parking, I tell him how valuable parking is, and when I’m under-parked, I start talking about Uber. I’m not admitting that’s true, but I did tell him that I think … Continue reading “A great article about robo-cars”
Category: What to buy
Closing on another one today
Today, we’re closing on a little fourplex deal in a neighborhood we really like. It’s a roughly $1.1MM all-in project, way too small on its own to be worth our time. However, it’s near a bunch of other stuff we’re renovating, it’s a simple project (no reconfiguration of the units), and we like the area … Continue reading “Closing on another one today”
Uh-oh… they’re baaaa-aaaccckkkk
We’ve now reached the point in the cycle where brokers describe their over-priced apartment deals as “condo conversion opportunities”. Why would a broker do this? Well, if your client demands a price so high that no buyer could actually achieve any kind of yield on their investment, you don’t really have many options. But, in all … Continue reading “Uh-oh… they’re baaaa-aaaccckkkk”
The replacement cost barrier
As we seek to deploy our current pool of capital at a time of generally high prices, we are running up against the issue of replacement cost. Here’s the problem: As a repositioner, you don’t really want to be in the position of spending more to buy and renovate a building than it would cost … Continue reading “The replacement cost barrier”
Is it too late to buy?
A lot of people are wondering whether it’s already too late in the cycle to buy. After all, prices have bounced back up off the floor of 2009-10. For context: I sold a bunch of totally renovated buildings in 2011-12 for 10-10.5x the rents. I would get 11x all day right now, and possibly more. … Continue reading “Is it too late to buy?”
Are you an investor or a speculator?
Market prices are up across the entire city. Where you could once buy stuff for 10x GRM, almost everything is now 12x+. If you’re looking at deals now, it’s important not to get caught up in thinking about buildings relative to each other. At any time, I can tell you what the best thing to … Continue reading “Are you an investor or a speculator?”
Right now, you need soft eyes
There are no perfect deals right now. Think about it: People don’t generally sell perfect buildings where everything is going great. They definitely don’t right now, when the alternative to owning the building is to hold the money in their money-market account earning 0.25%. Does that mean you shouldn’t buy anything? No. There are definitely … Continue reading “Right now, you need soft eyes”
The state of the West Hollywood apartment market
Today I spoke with a broker who has an eight unit property in West Hollywood listed at a somewhat reasonable $187,500 / door. I say somewhat reasonable because the gross rent multiple is 15x. At a list price of $1.5MM, that means the property is generating rents of $100,000 / year. The rents are obviously … Continue reading “The state of the West Hollywood apartment market”
Incredible FHA opportunity in Echo Park
If you fit the following criteria, you should get in touch immediately: Want to live in Echo Park Want to buy a fourplex apartment building Have a good job and good credit Do not currently own property Have at least $60,000 in the bank This is the kind of deal that ensures a family’s financial … Continue reading “Incredible FHA opportunity in Echo Park”
Why no wealth manager has ever called me
Do you know that no wealth manager has ever called me about getting his clients into apartment deals? I’m not saying I’m famous or anything, but this blog does come up fairly high in the Google results if you start looking for information on apartment investing in Los Angeles. There are literally thousands of people … Continue reading “Why no wealth manager has ever called me”