Here is part 3 of our Commercial Real Estate Investor Training in Dallas – Notes from the Field series. You can view our commercial real estate training day 1 here or day 2 here.
After spending Day 1 and Day 2 of Jayme Kahla’s Commercial Inner Circle locating and identifying qualifying properties, Day 3 started with a buzz – the investors had found 16 properties (ok…so Jayme brought 2 to the table) and now…the fun work was about to begin!
Since most of the deals were Dallas, TX multi-family apartments, we created a spreadsheet to log the important factors to allow for a quick review and of course, to help us train the other commercial real estate investors that are in the group.
The six factors we included in the spreadsheet are:
1. Gross Potential Income
2. Vacancy
3. Gross Operating Income
4. Total Operating Expenses
5. Net Operating Income
6. Cap Rate
7. Desired Cap Rate
These factors allowed us to level the playing field and look at multi-family units and the hotel solely based on their financial merits, with no emotions involved.
The person who brought the deal to the group was designated the point person; they verbally gave us highlights of the deal, which allowed the group to review 16 properties in a mere 3 hours.
If a deal looked marginal from the initial analysis, the point person could elaborate the properties points, i.e. favorable financing, etc.
All this work generated a group decision of moving forward immediately on two properties, with further due diligence needed on six others.
We delegated tasks and by the end of Day Three we had submitted a Letter of Intent (LOI) on two of the multifamily apartments, and expect those to go to contract (we’ll be using a Texas Real Estate Commission Form) sometime later next week.
Now, you’ll admit that these are pretty good results for a few days work, right? It’s amazing what a little hard work and focus will do. And when we concluded the commercial real estate investor training in Dallas, we asked ourselves and you: “Why aren’t you doing this in your market?”
Come check us out live and in action at our next Commercial Real Estate Investor Training, June 17-20 in Dallas, TX!
We not only practice what we preach, but we’ll show you HOW to do what we do!
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