Aug 15, 2017
A passion for exploring led Reed Goossens to move from Australia to the US. After studying real estate in Australia, Reed was amazed that he could purchase real estate so cheaply in America. However, he soon ran out of money before discovering a new strategy to raise money and syndicate large apartment deals. On this episode, Reed shares his criteria for vetting target markets and sub-markets for large apartments and explains why investing in larger deals is actually less risky than smaller investments.
Key Market Insights
- Started with a Class D, Section 8 triplex in Syracuse, NY
- Investing for beginners: Don’t just look at the numbers on the paper
- Two things that drain cash flow quickly: deferred maintenance and high vacancies
- From small investments to syndication deals: Reed moved from using his own money to buy duplexes and triplexes to using other people’s money to go after bigger deals
- The biggest benefit of raising your first $100,000 of investment capital? To build the network and reputation that allows you to close more deals
- Biggest mistake people making in syndication deals: Thinking they have to make a lot of money in deal #1
- Why international investors invest in America: High yield on capital, US currency is one of the strongest in the world, Long-term capital preservation
- View syndication as 2 businesses: 1) Finding the real estate and 2) Raising capital. It’s a team sport
- Reed’s personal investment strategy for markets: safe, affordable housing for blue collar renters
- Looks at population growth, good GDP, moderate cap rates, household income between $45,000 - $70,000 per year
- Seeks 200 basis points difference in national interest rates and local Class B cap rate
- Identifies Houston neighborhoods where there is infrastructure growth= Areas where the following are prevalent Amazon Fulfillment Centers, Home Depot, Starbucks, Engagement from city council
- How to navigate new markets: examine the data, have a solid team in place, listen to the locals, have meetings with real estate stakeholders
- #1 Tip: Get off the couch and cold call people
- Do desktop research via Trulia and similar sites to map the data for properties of interest
Resources Mentioned
Reed’s Free eBook – “The 4P Rule: Start
Raising Capital Like a Pro” by Reed Goossens
Reis Report www.reis.com
CoStar www.costar.com
CBRE Market Reports www.cbre.com
Tweet This:
“Syndication is a team sport.” – Reed Goossens
“Don’t just look at the numbers on the paper” – Reed Goossens
Places to Grab a Bite in Los Angeles:
Taco stands in Santa Monica
Street Vendors and Food trucks
Connect with Reed:
Website: www.rsnpropertygroup.com
Email:
reed@rsnpropertygroup.com
Podcast:
Investing in the
US: An Aussie’s Guide to US Real Estate -
Twitter:
www.twitter.com/reedgoossens
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