Multifamily Acquisition

What the Private Equity Industry Could Learn from the Real Estate Industry.

Out in Horse Country | 8.24.24

You know what the merger and acquisition industry is missing? It's something we could steal from the real estate industry. You know how that commission check is split between the buy-side and the sell-side in real estate, well if private equity adopted that style I can confidently say more deals would reach the finish line. Trying to get a deal across the finish line when acquiring a business requires the buyer to wear so many hats! Where as in real estate your agent takes over some of the leg work and boy is that nice, so nice that we ended up buying a multifamily property in August 2024. There’s been some headaches in it, but nothing we couldn’t handle. Spend two years searching for a business to buy and it makes real estate feel like a walk in the park! That said, the returns in real estate are laughable compared to the returns in buying businesses but there are some seasons of life where lower returns with less risk is favorable.

When you find a great real estate agent that knows the area, is well connected and experienced in the real estate investment property industry half of your battle is done. Seriously. It’s amazing. Moving forward our goal is to buy one every year that will always be professionally managed and have a clear path to improving the infrastructure, interior and curb appeal resulting in a solid net operating income. We want our tenants to always feel safe & well taken care of.

Here’s what we looked for in our property.

1.) Cash Flow after paying management: This is tougher than you’d think right now, due to the high interest rates.

2.) Rent that is below market.

3.) Something special about the location that aids in attracting good tenants.

4.) Build cost is more than the selling price.

With this property we didn’t use any investors but we will be for the next one. If you are interested in being added to our accredited investor list, there is a link on our website.

That’s a wrap on big news over here, enjoy that morning brew!

Whitney