Organization Chart for Multifamily Lending

Do I Really Need An Organization Chart to Get a Loan?

“Spectacular achievement is always preceded by unspectacular preparation.” – Robert H. Schuller
Would you be surprised if I told you that one of the most useful documents to lenders in underwriting a multifamily loan is one I rarely receive?

In a hypothetical perfect world, it is the first thing I would want to receive when analyzing the borrower credit profile of any loan I work on.

It is something that really helps lenders clearly understand who is behind the deal and […]

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Does My Credit Score Matter For Commercial Real Estate?

If you are a real estate investor that is new to the commercial lending space, you might be wondering why lenders would want to know your personal credit score.

It drives me a little bit crazy when I hear the “gurus” selling training programs that commercial is brilliant because it is just asset-based lending, and all that matters is how the real estate performs…

It is only a half truth.

It makes sense that lenders base decisions on your property’s financial performance, cost […]

Burning Money
Holding Bitcoin

Liquidity – Why More is More and Non-Cash Alternatives

I made the plunge about a month ago – I became the proud owner of .027 Bitcoin and .885 Ether. If you’re doing the math, I took a whopping $1,000 and made my first foray into the world of cryptocurrency. It’s proven to be fortuitous timing if you’ve seen any news of late…

There have been a couple of bull runs in the cryptocurrency market over the last couple of years that have been hard to ignore, and there is […]

Arbitrage Opportunities in Multifamily

Is There Arbitrage Opportunity in Multifamily Today?

Arbitrage is such a great word. It implies some sort of mystery, intrigue, intelligence, and opportunity. All things that are attractive to us as humans and certainly the opportunity piece as multifamily investors.

The word emerged through the course of a conversation I had with a friend and real estate broker this week as we discussed market conditions and interest rates. There is a subtle arbitrage opportunity in today’s multifamily marketplace given where interest rates have fallen to and cap […]

Multifamily Compass

Multifamily Market Mid-Year 2020

As we round first base in the 3rd quarter of 2020, from my perspective we’re settling into a new-normal. A normal that is full of question marks and ambiguity. Not an easy place to be as an investor, but the appetite for multifamily remains quite strong.

The first half of 2020 is essentially the tale of two economies: the pre-pandemic economy and the economy of the pandemic’s first three months. The very nature of what this crisis has caused will […]

Empathy

Will Empathy Make Us Better Investors?

Does anyone else feel like we’re about 17 months into 2020 even though we’re only at the mid-July point???

The events of the last couple of months have been heavy, this year has been heavy, and I for one am feeling the weight. No need to rehash why, I know we’re all aware.

I started listening to an audiobook titled Principles by Ray Dalio a couple weeks ago. Admittedly it isn’t the lightest of reads either, but it’s been brilliant. I […]

3 Reasons Syndicators Should Embrace Mandatory Lender Reserves

Have you ever run out of gas? I’m not talking the figurative gas tank, but the literal one we have in our vehicles. (Tesla owners sub gas for electricity…)

I had a truck years ago that frequently over-stated the amount left in the tank and one time it got the better of me. Embarrassingly enough I ran out of gas. Such a pain to pull off to the side of the road, walk to the nearest gas station, spend a […]

non-recourse multifamily loans

The Difference Between Recourse and Non-Recourse Loans

I don’t have the exact quote, but the star quarterback turned real estate mogul Roger Staubach was asked about his biggest regret in building his real estate portfolio. His response was he wouldn’t have used debt with an unlimited personal guaranty attached to it. He felt that over years of experience a non-recourse approach was preferred.

That said, the point of this article isn’t to judge the merits or pitfalls of either recourse or non-recourse loans, but to provide context […]

Interest Rates in Uncertain Times

What Toilet Paper Shortages Teach Us About Interest Rates

I hate jumping on the Coronavirus bandwagon of content, but like it or not, it is having a real effect on our global economy and is causing a lot of uncertainty in the financial markets. This uncertainty is impacting the interest rates available on commercial real estate debt.

It’s really hard to say, nor is the point here to talk about what the Coronavirus situation really means to our economy long term. It is too early to really know.

What we […]

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Commercial Loan Prepayment Penalties Unwrapped

Nothing says romance quite like a prenuptial agreement does it?

That comment is certainly facetious, but sets the stage for an analogy regarding the prepayment penalty aspect of commercial loans. It is important to understand what you’re getting into with your loan. The loan documents explain all the terms of the loan, and the prepay piece is really the predetermined cost of breaking up with a lender.

A prenuptial agreement defines and outlines what things will look like in the event […]