Deals As Big As Texas
Hi my Name is Ray Isturiz, I am a Houston real estate investor, mortgage broker and realtor. I am looking for new investors, specially in CA, and Hawaii who would like to invest in TEXAS. Currently trying to raise 900K to buy multy unit deal , with positive cf of over a million per year.
Interested can e-mailme **Please See My Profile**
If the deal is that good, why not just finance it through the bank and you keep all the profit and cash flow.
It is a 16.25MM deal . We need to raise the 20% To be able to negociate the deal. 900K each work a deal for four investors. On fifth year each ivestor should be taking home around $300,000 before personal taxes.
Look a the Financials -proforma and unit matrix bellow.
Year: 2006
Scheduled Gross Income: $3,071,239
Vacancy: $153,562
Collection: $15,356
Concessions: $184,274
Other Income: $100,793
Effective Gross Income: $2,818,839
Maintenance: $201,600
Taxes: $405,205
Insurance: $112,000
Other Expenses: $809,981
Total Expenses: $1,528,786
Net Operating Income: $1,290,250
Expenses/Unit: $3,412.00
Expenses/SF: $4.56
Matrix
1-1
No. Units: 280
SF: 574
Avg. Mo. Rent: $477
1-1 sunroom
No. Units: 32
SF: 719
Avg. Mo. Rent: $542
2-2
No. Units: 116
SF: 996
Avg. Mo. Rent: $704
2-2 sunroom
No. Units: 20
SF: 1,006
Avg. Mo. Rent: $704
[addsig]
He claims a B.B.A. in Accounting and Finance from the University of Houston. How can he not understand how a capitalization rate is calculated? That is so basic!
Chris
Rent increased over 5% in the last twelve months due to creation of over 4 million new jobs nationwide, Interest rate is increasing, and cost of home ownership is increasing by the minute. National average of home value is about 223K making American dream out of reach for many. At a local level Hurricane Rita and Katrina has created a tremendous market for renters in Houston. Many evacuees are here waiting for months to get decent places where to stay. Anywhere from new jobs, to city and federal voucher programs are being implemented. There are not enough rental units in Houston to accommodate such a large migration. Not to mention the illegal number of people that is not being considered. If a little rent increase scared you, and think people are going to leave a nice decent place to save few bill a months, not counting moving expense and other places raising rent as you will be doing eventually. Then you need to be looking a different deal. Please note, that Rent prices are increasing faster that in the past six years. This year along it should double last year. It is no my job to educated you guys in what’s going on in today’s rental market. This complex is located close to airport, hotels, shopping centers, and yes work place. With gas prices the way they look, you might think twice moving further from work.
"It is no my job to educated you guys in what’s going on in today’s rental market"
If you are asking folks to put up 900K you better educate them on YOUR rental market.
Exactly. Why let facts get in the way of an investment decision...just keep selling an avoid answering the questions that would allow an investor to make an educated decision.
Dear Ray, you are correct, the vacancy rates in key TX rental markets surely decreased in the past year or two thanks to several reasons you manage to emphasize correctly in one of your follow up posts. However, according to readily available data, the vacancy rate in key TX markets still floats at about 6-8%, excluding some hot submarket such as Oak Lawn suburb of Dallas.
A 20% rent increase without any increase in quality of service, which as a strategy may work well on an older property purchased on solid discount to intelligently preempt future loss in CAP rate and ROI for investors, is not likely probability. Plain and simple your random rambling is nothing else then clear sign of your lack of knowledge in the aria of multifamily investment or as mentioned above a possible attempt to get rich fast at an unfortunately wrong place.
Respectively, to experienced investor, 8% vacancy rate provides healthy indication that you’ll not succeed in raising rents as much as you hope in your fantasy pitch. In light of all the above facts, it is my opinion; you should perhaps stick with condos and occasionally some 4-plexes. They commonly sell faster and provide a steady stream of income to a hard working agent.
If I was in your shoe now, I would either get serious and substantiate my assumptions with specific data absent of fantasy speculations to prove I am not a fool, or would apologize, rename my post to read “agent’s appetite big as TX”, then excuse myself to go learn some more before I move on with yet another post, which will likely embarrass you further.
Hey REOCON- I have 3.57 acre full city block for sale in the Oak Lawn area of Dallas if you are a developer- it is a great and redeveloping area and bright future.
sorry for the pitch- could not resist.
Quote:
On 2006-06-10 22:00, REOCON wrote:
Dear Ray, you are correct, the vacancy rates in key TX rental markets surely decreased in the past year or two thanks to several reasons you manage to emphasize correctly in one of your follow up posts. However, according to readily available data, the vacancy rate in key TX markets still floats at about 6-8%, excluding some hot submarket such as Oak Lawn suburb of Dallas.
A 20% rent increase without any increase in quality of service, which as a strategy may work well on an older property purchased on solid discount to intelligently preempt future loss in CAP rate and ROI for investors, is not likely probability. Plain and simple your random rambling is nothing else then clear sign of your lack of knowledge in the aria of multifamily investment or as mentioned above a possible attempt to get rich fast at an unfortunately wrong place.
Respectively, to experienced investor, 8% vacancy rate provides healthy indication that you’ll not succeed in raising rents as much as you hope in your fantasy pitch. In light of all the above facts, it is my opinion; you should perhaps stick with condos and occasionally some 4-plexes. They commonly sell faster and provide a steady stream of income to a hard working agent.
If I was in your shoe now, I would either get serious and substantiate my assumptions with specific data absent of fantasy speculations to prove I am not a fool, or would apologize, rename my post to read “agent’s appetite big as TX”, then excuse myself to go learn some more before I move on with yet another post, which will likely embarrass you further.
Commercial King- sorry for the delay, I have had both hands on the wheel the last few weeks. I am always interested in a deal that comes from a guy who has done it all before. Do you have a package on it or is it all filled up now?
I hope you know I meant no disrespect by my comments, love to talk about the business though- every deal is different.
WOW I hope that Rays holes in his presentaion doesnt sour anyone on Houston. The website that you mentioned Dallas is not like MLS, they dont take down or change the status of properties that can be viewed by the public. Some "investors" use this website to pitch properties to their buyers in hopes of securing a fee. It seems that was what Ray is doing. If that was what he was trying to do he should pitch properties that are private that he has some sort of agreement with the seller for. That way he wont tarnish my city. I have no patience for "Investors" that have no idea what they are doing. I dont profess to know everything but you should know how to put together a deal especially if you want someone to invest in it. In terms of CAP rate their are some 10+ caps here in Houston, and not just on that website. These CAPS are on actuals, not proformas. There are also some that have between 4-5M in equity. Katrina has affected the market but it is not a rosy a picture as Ray tried to SELL. Yes, vacancy rates went down, but crime in those complexes with evacuees went UP. I advise all of my out of state clients to stay away from properties that have between 7-10% Katrina victims. This restriction is for properties that have 200+ units. There is too much money on the line to be concerned with making sure that you have a strong police pressence at your property. If that is the case it wont be long before the vacancy number in those particular properties trending upward.
Ray
You can call it whatever you want. My investors and I make sound, smart investments. If you think that has racial motives behind it then it is obvious as to why all the comments were made in this thread about you. Nothing about my comments were racial, they had to do with the FACT that crime is up in those complexes that have Katrina victims, and the crime in those complex spiked during all of the Katrina move ins. Anyway all of this is besides the point. Represent yourself in a professional, intelligent way and not as someone trying to get over. People will respect you more.
I think commercialking and RMDane hit it right.
Scrutinize the lease for sure if it is a single tenant deal. Look for the obvious, especially time left on the lease but also note possible outs for the tenant as well as items covered by the owner (you) that are not covered by the tenant.
Will they provide historical financials on the tenant and does the tenant have financial reporting obligations to the owner as part of the lease?
It could be a real deal at the 12.6% CAP but if it is offered by a broker with knowledge of the current climate in Texas I would guess that there are some serious risk issues involved. The only thing that might explain the "deal" is that it is a possible sale-leaseback deal that involves a tenant that is less credit worthy than others. The issue then becomes whether anyone will finance it. They might but maybe only at 50-60% LTV or something. If no financing can be found then it would be an all cash deal- big one at $7.9MM.
I can tell you about the area if it is in North Texas and want information on the area.
Thanks for all of the feedback. I need to get some of these questions answered.
Dallas_Apt_Investor, this property is in Austin. From what I hear, that economy is going pretty strong
Knowledge, those numbers are proforma numbers not actuals. This property is on Rays famous website. Be careful. This property needs to be leased up.
Ya. Ray likes to pull properties off of the same website that your proposed deal is on, create a forum here, and solicits interests.
Problem is that he doesnt know how to put the deal together and everyone is exposing the holes in the project, not to mention the fact that he doesnt even own the property or have a contract on it.
He also seemed to add a nice commission in the deal for himself when the property was on the internet for public view.
Thats some of the story about Ray and his famous website. The rest is not even worth mentioning.
Anyway, like I said in my earlier post, according to the website (apparently you cant mention other websites here) the numbers are all based upon a broker proforma. Be careful.