The $15 Million Dollar Commercial Real Estate Challenge: Setting The Stage
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Just watch me....win or lose!
This is the first time we are announcing this publicly!
My partner, Rob Powell, is working on buying a $15 million deal in Texas, and we want you to follow along in real time as he works this project.
Follow on Twitter: http://twitter.com/RobAPowell and Subscribe to this blog for more detailed updates!
We don’t know if this deal will close… we’re doing this in real time without a safety net. But we’re going to be sharing what happens step by step and we want you to be a part of it.
As an extra incentive, we’ll be providing special “bonuses” like some of our closely-kept property documents as a gift to you to help you follow along and to assist you as you work your own commercial real estate deals.
Heck, you may even have a chance to participate in this as team members… we’ll have to see how things play out.
CAVEAT: The Internet is a big, exciting and PUBLIC place. Our only limitation is that we don’t want to give away too much insider information that could get back to parties that are not as nice as you, so some identifying details will be left out of the public conversation. Shhh! However, we strive to give enough information that you can follow along just like you were doing the deal with us!
The Deal Itself:
This commercial real estate deal is a $15 million apartment building in Texas with approximately 500 units. It is a “C” class property in a “C” area with an 80% occupancy rate.
Where We Found It:
Just like we’ve taught our private coaching students, some of the best deals are to be had through creating relationships. We call them “Wealth Lifelines.” This deal was found by networking with real estate agents who knew Rob was a serious buyer looking for a good opportunity.
The Numbers:
When Rob found this apartment complex, it was hovering around 80% occupancy after some management transition had increased the vacancy from it’s historically lower levels.
He was attracted to the deal because it cash flowed at that level, so there was good upside potential.
Even though the cap rate was in the “7″ range when he first saw the property, Rob was able to negotiate $1.5 Million off the purchase price to get it locked up 
at an 8-cap.
If nothing changes when they do the financial review, Rob should be able to get an 15% cash-on-cash return on this deal.
What’s Next:
Rob is just starting the due diligence phase of the process. He has 45 days for due diligence and it started yesterday (4/20/2009).
He is hiring an asset management firm, and a property management company he’s worked with in the past to cooperate in doing the research necessary to complete the due diligence.
Want to know what he’s working on NOW?
Follow him on Twitter to find out!
http://twitter.com/RobAPowell
This is an exciting deal and I am looking forward to revealing more as we get further into the process!
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