Jul 24, 2020
Analyzing multifamily apartments can be overwhelming for new investors. It can even be a challenge for some seasoned investors. As Rob Beardsley was starting out, he could not find good resources on the multifamily underwriting process. This led Rob to pen The Definitive Guide to Underwriting Multifamily Acquisitions to help others.
Rob Beardsley oversees acquisitions and capital markets for Lone Star Capital. They have over $100 million in units under management. Rob shares some of the key inputs to review when considering passive investment opportunities. In this episode, he shares his thoughts and guidance on underwriting cap rates, rent growth, rehab schedules, and lending.
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Underwriting is more art than science and is the most complicated part of real estate investing
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Bought a poorly occupied deal that needed a lot of work which required a repositioning of the tenant base. He underestimated the fact that when you change the demographics, you’re not going to go linear from 70% to 90% occupied. It will be more like from 70% to 50% and then up to 90%.
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Writes in his journal: What he is grateful for and his goals and tasks for the day.
Wish I Knew When I Was Starting Out:
Do your due diligence, and do it exhaustively.
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