In this episode, I dive into a topic that many active multifamily investors struggle with - how to structure partnerships when working with just one large LP or money partner. I share a simple partnership structure that can help you navigate this process effectively. Please note that while I provide conceptual advice, it's important to consult with an attorney to ensure compliance with legal requirements.

Throughout the episode, I walk you through a hypothetical situation, explaining how I personally approach and have successfully implemented this structure in our business. I cover important aspects such as operating agreements, preferred returns, splits, and overall value creation.

In this episode we discuss:

• How can investors compensate their money partner with a preferred return and profit split?
• What are the considerations when structuring the deal to meet bank requirements and SEC compliance?
• How can investors navigate the equity threshold with the bank when bringing in a big investor?
• What are the benefits of using a preferred return and profit split structure in communicating with investors?
• How can investors start putting together joint ventures and partnerships with this structure?

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:

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Learn more about Aligned Real Estate Partners

In this episode of the Multifamily Wealth Podcast, I sit down with Sharad Mehta, founder and CEO of REsimpli. With over 50 doors in his rental portfolio, 45 of which are paid off, Sharad is not only a successful real estate investor but also a leading expert in real estate-specific CRMs.

During the conversation, Sharad shares his insights on the importance of using a CRM for real estate investors, particularly when it comes to direct-to-seller marketing. He emphasizes the value of streamlining and systematizing lead nurturing through features like drip campaigns, which allow investors to automate follow-ups and stay top of mind with potential sellers.

The discussion also delves into the strategies and best practices for going direct-to-seller in the multifamily space. Sharad highlights the effectiveness of direct mail in building relationships with sophisticated sellers and offers advice on targeting specific lists and sending multiple touches to establish credibility and rapport.

In this episode we discuss:

• How can real estate investors effectively utilize a CRM for direct-to-seller marketing?
• What are the key functions of a CRM in the real estate industry?
• Why is consistent follow-up crucial in nurturing leads and building rapport with sellers?
• What are the best strategies for going direct-to-seller in the multifamily market?
• Should investors focus on sending more mailings to a smaller, targeted list or fewer mailings to a larger list?
• How can direct mail be an effective marketing strategy for multifamily properties?
• What is the importance of building a reputation and staying top of mind with sellers through consistent marketing efforts?

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:

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Learn more about Aligned Real Estate Partners
Use Axel's ReSimpli affiliate code

Connect with Sharad:

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Learn more about REsimpli

In this episode of the Multifamily Wealth Podcast, we sit down with Neal Bawa, a highly regarded syndicator in the real estate industry. With a background in technology and data science, Neal brings a unique perspective to the world of real estate investing. He has successfully invested in various asset classes, including multifamily, industrial, mobile home parks, self-storage, and built-to-rent communities.

During our conversation, Neal shares his data-driven approach to market selection and underwriting, highlighting the importance of evaluating cities based on factors such as population growth, job growth, home price growth, income growth, and crime reduction. He also emphasizes the significance of considering property taxes and insurance costs when making investment decisions, as these factors can have a significant impact on profitability.

We delve into Neal's asset management strategies, including the use of dashboards and data visualization to track key performance indicators (KPIs) and hold property managers accountable. He explains how his team utilizes an efficiency center, consisting of both US-based and overseas talent, to streamline operations and enhance efficiency.

Towards the end of the episode, Neal discusses his current focus on built-to-rent (BTR) properties, explaining the changing dynamics of the rental market and the increasing demand for single-family rentals among millennials.

In this episode we discuss:

• How does Neal use data science to select the best markets for real estate investment?
• What is the significance of low property taxes and insurance in maximizing profits in real estate investing?
• How does Neal's team utilize dashboards and data visualization to improve asset management?
• What is the role of overseas talent in Neal's asset management strategy?
• How does Neal maintain accountability and communication with property management teams?
• What are the key metrics and KPIs that Neal tracks in ongoing asset management?
• What is Neal's current focus in the real estate market, specifically in the built-to-rent asset class?

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:

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Learn more about Aligned Real Estate Partners

Connect with Neal:

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Learn more about Mission 10K
Smart investing made easy with Multifamily University

In this episode, we discuss the importance of offering multiple leasing options and incentives to prospective residents. We dive into the strategies used by sophisticated multifamily owner-operators and how they can be applied to maximize success in your own business.

If you're currently leasing units in the winter, I highly recommend considering 18-month leases to incentivize residents to stay longer. I also touch on the option of shorter leases, such as six or nine months, to help you get on a better leasing cycle.

In this episode we discuss:

• How can you lease your vacant units like a pro during off-peak leasing seasons?
• What lease terms should you offer to put yourself in a position to lease most units during the peak season?
• How can you model your operations and asset management after the best operators in the country?
• How can you incentivize applicants to sign longer lease terms without losing rent?
• What strategies do sophisticated multifamily owner-operators use to lease their units?

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:

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Learn more about Aligned Real Estate Partners

In this special episode of the Multifamily Wealth Podcast, we celebrate reaching episode number 200! It's been an incredible journey over the last three and a half years - through this podcast, I've had the privilege of connecting with amazing individuals - partners, investors, vendors, and so many others - who have enriched our business in countless ways.

In this special episode, I take a moment to reflect on the impact this podcast has had on our business and share some insights into what we do at Aligned Real Estate Partners. I understand that many of you may have joined us recently and may not be familiar with our story, so I wanted to take this opportunity to provide some context and validation for the topics we discuss on the show.

Here's to 200 more!

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Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:

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Subscribe to our YouTube channel
Learn more about Aligned Real Estate Partners

In this episode of the Multifamily Wealth Podcast, I discuss the two different types of investors in the multifamily business: decimal investors and deal investors. Decimal investors are those who primarily focus on analyzing deals through Excel sheets and lack experience in evaluating properties on-site. They struggle with understanding factors like location, building structure, and desirable floor plans. 

On the other hand, deal investors have a more holistic approach to investing, considering factors beyond just numbers. I also talk about the importance of being a deal investor and provide insights on how to achieve success in real estate investment.

In this episode we discuss:

• How do decimal investors differ from deal investors?
• What activities do decimal investors focus on?
• What activities do deal investors prioritize?
• How do deal investors find better deals?
• Why is being a deal investor more advantageous in real estate investing?

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:

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Subscribe to our YouTube channel
Learn more about Aligned Real Estate Partners

In this episode of the Multifamily Wealth Podcast, we welcome back Paul Moore of Wellings Capital. With over 20 years of experience in real estate, Paul has a diverse background that includes residential and commercial investments, as well as ventures in oil and gas. He is the author of "The Perfect Investment" and has a deep understanding of the multifamily syndication space.

In this episode, Paul and Axel dive into the topic of preferred equity, a hot topic in the multifamily and commercial real estate sectors. They discuss the different types of preferred equity, including its use in development, value-add deals, refinancing, and as rescue capital. Paul explains the benefits of investing in preferred equity, such as immediate cash flow, future upside, and lower downside risk exposure. He also shares insights on what to look for in a preferred equity investment and the importance of partnering with experienced operators.

In this episode we discuss:

• What is preferred equity and why is it a hot topic in the multifamily and commercial real estate sectors?
• How does preferred equity differ from preferred returns or preferred hurdle rates?
• What are the different types of preferred equity investments, such as development, value-add acquisitions, refinancing, and rescue capital?
• What are the benefits of investing in preferred equity for LPs, including immediate cash flow, future upside, and lower downside risk exposure?
• How can preferred equity help operators reduce their blended cost of capital and capture more of the upside in a deal?
• What attributes does Wellings Capital look for in preferred equity deals, such as experienced operators, reasonable underwriting, and clean backgrounds?
• What are some signs that a preferred equity deal may not be a good investment, such as red flags in the operator's background, changing deal terms, or lack of a cohesive team?

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:

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Learn more about Aligned Real Estate Partners

Connect with Paul:

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Learn more about Wellings Capital
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In this episode, I dive deep into the most important metric to analyze when underwriting multifamily real estate deals. Whether you're an LP looking to invest in another investor's deal or a sponsor's deal, or an active investor screening deals, understanding this metric is crucial in determining if a deal makes sense in today's market.

The metric I'm talking about is stabilized yield on cost. I've discussed it before on the podcast, but I wanted to revisit it because of its significance. Stabilized yield on cost provides a view of how a deal is going to perform independently of what's going on in the capital markets. It allows us to accurately project the potential of a multifamily investment.

Unlike other metrics, such as IRR, which rely on projections of future cap rates, stabilized yield on cost focuses on the ongoing cash flow and compares it to the cost of capital. By understanding this metric, you can quickly determine if a deal offers positive or negative leverage and if it aligns with your investment goals.

In this episode we discuss:

• What is the most important metric to analyze when underwriting multifamily real estate deals?
• Why is stabilized yield on cost a crucial metric to track in multifamily investing?
• How does stabilized yield on cost differ from metrics like cash on cash return and IRR?
• How can stabilized yield on cost help determine the strength of a deal and create value in today's market environment?
• How can the risk profile of a deal impact the acceptable spread between stabilized yield on cost and market cap rate?
  
  

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:
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Subscribe to our YouTube channel
Learn more about Aligned Real Estate Partners

In this episode of the Multifamily Wealth Podcast, I delve into the true mathematical impact that vacancy has on a multifamily property's net free cash flow. Join us as we break down the numbers and discuss how even a small increase in vacancy can have a significant impact on your bottom line. 

I dive deep into the numbers and explain how vacancy can significantly affect your investment portfolio. We often overlook the impact of vacancy, but once you understand the math behind it, you'll see just how crucial it is to consider when analyzing your investments.

In this episode we discuss:

• What is the true impact of vacancy on a multifamily property's net free cash flow?
• How does reducing vacancy by 2% affect net operating income (NOI)?
• How does leverage and debt service payments magnify the impact of vacancy on net free cash flow?
• What is the rule of thumb for the potential impact of a 1% increase or decrease in vacancy on net free cash flow?
• Why is it important for multifamily investors to understand the mathematical impact of vacancy?

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:
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Learn more about Aligned Real Estate Partners

In this episode of the Multifamily Wealth Podcast, I dive into a topic that is often overlooked when it comes to real estate investing - transactional costs. You see, when buying and selling properties, there are a lot of hidden costs involved that can significantly impact your returns. 

Whether you're an investor or a homeowner, understanding these costs is crucial. I break down the math and explain why it's essential to consider the impact of buying and selling on your equity beyond just the percentage of a property's purchase price. I know this topic may not be commonly discussed on other platforms, but I believe it's vital for anyone considering buying or selling a property. The episode is packed with valuable insights and practical advice that you won't want to miss.

In this episode, we discuss:

• How can transactional costs impact an investor's or homeowner's returns when buying and selling a property?
• What percentage of a property's purchase price do closing costs typically represent?
• How do closing costs affect the equity invested in a property, especially when using debt?
• How does leverage magnify the impact of transactional costs on equity?
• Why is it important to accurately underwrite transactional costs before buying a property? 

Struggling to find good multifamily deals? Looking to close deals with less of your own money? Want to operate like the pros and maximize the cash flow of your assets? Join The Multifamily Wealth Community, where we help multifamily investors start, build, and scale their businesses… specifically, those looking to grow from 1-10 units to 250+ units.

Are you looking to invest in real estate, but don't want to deal with the hassle of finding great deals, signing on debt, and managing tenants? Aligned Real Estate Partners provides investment opportunities to passive investors looking for the returns, stability, and tax benefits multifamily real estate offers, but without the work - join our investor club to be notified of future investment opportunities.

Connect with Axel:
Follow him on Instagram
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Learn more about Aligned Real Estate Partners