Three months into 2021 and Q1 has already come and gone! CRAZY.
On the personal portfolio side of things (properties 1-3), all of my units are rented and occupied, but I do have a lease expiring on my single family in June. My property manager has already reached out to the tenant to see if they want to renew.
On the larger deals that I'm a partner/investor in (properties 4-7), rent collections have still been down through COVID, but my properties in Arizona and California (properties 5, 6, and 7) are well positioned with plenty of reserves. Unfortunately, the 80-unit in Louisville (property 4) is still running into issues with low rent collections and I did not receive a distribution for Q1 2021 from this property.
More details below!
My First Property
I bought this single family house in December of 2016 and SOLD it in May of 2018. 2 Bed/1 Bath in a "C" Class neighborhood in Indianapolis, Indiana. NO MARCH INCOME. See how it performed HERE.
If you're looking to buy your first rental property and want to jumpstart your education on the processes, procedures, and strategies, check out the new ebook I just launched.
My Second Property
I bought this single family house in March of 2018 in Indianapolis, Indiana. 2 Bed/1 Bath in a "B" Class neighborhood. It's currently rented on a 24-month lease.
I had a very clean and smooth month with this property. No repairs or maintenance issues. Full cash flow received! BUT, as mentioned earlier I have an impending lease expiring in June so my property manager is trying to get the lease renewed and we're already starting that conversation.
Gross Rents: $995
Property Taxes: $216.32
Property Management: $89.55
Repairs and Maintenance: $0
Income ($995) - Expenses ($728.79) = $266.21
Cash Flow from My Second Property: $266.21
My Third Property
I bought this duplex in July of 2018 in Indianapolis, Indiana. Both units are 2 Bed/1 Bath in a "B" Class neighborhood. Both units are on 24-month leases.
After a little bit of a rough start to 2021 for this property, we're back on track and we're at 100% occupancy! Although, one tenant has seemingly gotten in the habit with late payments every month, we've been working with them to get back on track and they've always eventually made their full payment.
Gross rent from Unit 1: $875
Gross rent from Unit 2: $875
Property Taxes: $221
Property Management fee: $175
Income ($1,750) - Expenses ($1,247.74) = $502.26
Cash Flow from My Third Property: $502.26
My Fourth Property
This is an 80-unit apartment complex in Louisville that I invested in passively through a company called Holdfolio. Unfortunately, things haven't gone as smooth as expected in this deal and Holdfolio is not hitting their underwritten timelines and budgets. It was acquired for $2.25 million and we're investing another $1 million into it as a group.
This is a completely passive investment for me as a Limited Partner and amazingly, we were paid out a distribution (albeit small) for Q4 of 2019 and Q4 of 2020 (also, very minuscule).
Occupancy is staying steady at 100%, but collections have been struggling as the resident base is largely service workers who have been hit the hardest by COVID. Collections were down to 72% which obviously hurts cash flow. On top of that, we're now starting to pay principal on our loan after 2 years of interest only payments. This is an extra $2,200 a month that's cutting into cash flow.
As a Limited Partner in this deal, there isn't much I can do except be patient and trust my partners to get this property turned around and continue to cash-flow. This was my first tip-toe into the larger multifamily world and although it's been challenging, it's been an eye-opening learning experience.
Total ROI since investing start date 10/11/18: 1.49%
Oh, and one more surprise...there was a Honey Bee colony found in one of the units...
My Fifth Property
This is a 164-unit apartment complex in Phoenix that I invested in passively. It was acquired for $19.75 million and we're investing an additional $2.5 million into it.
This continues to be a great investment and I'm working with some amazingly experienced partners on this deal and I couldn't be happier. Gross income was up, expenses were down, and Net Operating Income was up! I also got a distribution from this property for Q4 of 2020.
80 units have been renovated with additional units being worked on now.
My Sixth Property
This is an 94-unit apartment complex in Phoenix that a group of partners and I purchased and closed on at the end of November 2019. It was acquired for $10.3 million and we're investing another $3 million into it.
As a member of the General Partner team, I flew out to Phoenix multiple times running due diligence, checking out comps, vetting the business plan/strategy, and connecting with investors.
This property has now been under my partners' and my control for about a year now and we're really starting to see the fruits of our labor. All roofs were replaced, exterior is done, and the pool is pretty much finished. This was my first property as a General Partners and it's been a fun ride and transformation to be part of. Check out the renderings for the new office and gym we are constructing!
My Seventh Property
This is my newest acquisition and it's my first in-state investment. What's cool is that I can literally drive from my home to visit this property in under an hour.
This is an 12-unit apartment complex in San Jose, CA that a group of partners and I purchased and closed on at the end of October 2020. It was acquired for $3 million and we're investing another $300,000 into it.
Current rents are about $1,200 per unit right now and after renovation we anticipate pushing them up to $2,100 per month. Value add baby!
With this being my first in-state investment, I decided to take a chance and give this whole California investing thing a try. I'm working with some amazing local partners on this deal. No way I could pass it up!
If you are interested in learning more about getting involved in deals like this and investing, you can reach out to me directly HERE.
After 3 months of 2021 I'm extremely excited for what the rest of the year has in store for all of us. My portfolio overall had a very smooth month. Other than the continuing struggles of my investment property in Louisville (property #4) everything else performed well.
Keep pushing forward, work hard, and reach out if you ever have any questions!
***VERY IMPORTANT NOTE: even if I'm bringing in positive cash flow after all my expenses are paid, I'M NOT TOUCHING any of it! This income goes toward my next investment and any future expenses. I have a day job and side-hustles to cover my lifestyle :)
If I ever get to the point where I actually want to take the cash flow, I would still only take about half of it and save the remainder for future expenses. This is SUPER IMPORTANT! ALWAYS factor in future vacancy/repair/maintenance expenses. Make sure you know how to properly calculate cash flow HERE.
Let me know if you have any questions!
P.S. Keep an eye out for a BRAND NEW YouTube channel my good friend and I are launching soon :)