Monica Main's Apartment Building Cash Flow System - Day 109

Monica Main’s Apartment Building Cash Flow System – Day 109

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I know it’s been a little while since I last told you my discouraging news that Monica didn’t like the property analyses I had sent her way. Not long after that, I received an email saying that because it’s been such a buyer’s market, she and her partners had bought more than they anticipated this quarter and wouldn’t be buying again until next quarter.

Which is one month away.

I have spent this time continuing to analyze properties. And I’ve been learning about building my own business credit. While I LOVE the idea of Monica — with her TWELVE YEARS of experience — being my partner on my first purchases, I also know that eventually I’m going to want to buy them on my own.

I JUST now received two emails from Monica saying that she may be interested in moving forward on a couple of deals I sent her. She wrote:

Katy,
Thank you for sending the CFE for your deal.

As you know, there are many requirements that have to be analyzed then matched to our criteria before a deal can be presented for partnership.

Please make sure that you send me the following in ONE email:

* CFE including itemization of actual expenses from the last fiscal year (2009)
* 3 years of actual income and expenses
* Current rent roll
* 3 year proforma
* 12 pictures of the property
* Appraisal (if the property owner had one in the past 6 months)
* Business plan for how you will manage the property as part of the partnership requirements
* Affidavit from the seller or seller’s agent stating that the property is 85%+ occupied

Please go down the list and send me each of the above requirements so that I may present your deal to my investor partners for further review.

Sincerely,

Monica Main

I forwarded the email over to my broker in the area. Yes, I got myself a buyer’s broker to represent my interests. I pay him nothing. He’ll split the commission with the listing broker. He’s going to get to work on putting all this information together on both properties first thing in the morning. I, meanwhile, will be writing up the business plan for property management.

I’m so excited. Let me tell you just a few quick numbers about these two properties.

131-unit property with a monthly cash flow of $9,462
138-unit property with a monthly cash flow of $15,454

The way the partnership works, Monica and her partners get all the financing, and then I’d get half the equity and half the cash flow. So for these two, I’d get $4731 and $7727, respectively. If she wanted to go ahead with both properties, I’d make $12,458 and month.

You ready to do this too?