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Investing in apartments is not only about analysis and numbers. It is primarily a relationship business. Building a strong team can truly make the difference between from a stalled to a spectacular apartment investing career.
You maybe able to get muscle one deal through on your own, but to build an apartment investing business, even part-time, you will need to build a team. By having a strong team behind you, you won’t need to be your own lawyer, accountant and property manager. In fact I STRONGLY advise that you do NOT act as one. Let the professionals on your team protect you from making costly mistakes.
Lets examine what professionals are on your real estate team. In this article, let’s talk about your apartment investment business Foundation Team.
Property Managers are also an important part of your asset management team. As part of our field partner team, they will know the local markets intimately, and often perform perfunctory due diligence for us. They often have relationships with local trades, and can often give you the backstory of the deal that the broker may not know.
Commercial Brokers Unlike single family realtors, there are not as many brokers. Take a look at Loopnet, and look in smaller markets. You’ll see quickly who has the most listings. I don’t go to Loopnet to find deals. Not that you can’t manufacture a deal, but these deals have been seen and passed over. However, Loopnet is a great tool for getting the names of brokers in your markets. Make sure that you treat their time with respect, and be ready to move if they find you a deal that meets your criteria. Click here for more on creating a strong Broker relationship.
Pro Tip: I frequently ask Property Managers for Broker references ad vice-versa.
CPA a crucial team member, make sure that you’re not using your regular business accountant, but a real estate accountant. One of the major benefits of investing in apartments are the tax advantages, and an experienced accountant can help maximize these benefits. Having a CPA who understands what type of entity you need to form and how to execute a multiple entity business structure can legally save you thousands of dollars a year.
Lawyer Attorneys are essential for contract review, and if you are raising investor dollars, the deal structure can be quite complex. There are different types of attorneys that you use in multifamily investing. Make sure that you consult an SEC attorney to make sure that your deal adheres to legal guidelines. You may employ contract and transaction counsel as well.
Legal Team Essentials:
An advantage to investing in apartments is the scale allows you to quickly scale, but adversely, the mistakes are potentially far more expensive.
The mistakes that your professional foundation team can protect you from can be priceless. Most importantly, allowing your team to perform in their field of expertise allows you to spend your time doing what you do best, growing your apartment investment business.