In a past set of articles, I introduced the idea of having a team around you to help build your apartment empire. Since the team is so important to your success as a real estate investor and, more specifically as an apartment owner, I would like to take the opportunity to discuss how to find and use these team members in a little more detail.
Just to recap, some of the essential team members that you’ll want to have in place include:
- Bird dogs
- A real estate agent or agents
- A commercial mortgage broker
- A banker (one or more)
- A title company or closing attorney
- A real estate attorney
- Private lenders
- An SEC attorney (if part of your business includes securing private funding)
- An asset protection attorney
- An accountant or CPA
- Property management companies
- Contractors
Among potential financiers for your real estate purchases, a banker is far more important for commercial projects than for smaller residential purchases. If you’re like many investors and started with residential properties, then a banker may not be a professional relationship that you’ve really looked into up until now. With apartments, this needs to change.
Local banks exist because they have a vested stake in the community. They, like all banks, make money when they lend money. The big difference here is a that a local bank tends to funnel more (or sometimes all) of its loans into local properties and those persons who live or invest in them.
A local bank will also tend to have greater appreciation for the potential you see in an apartment deal. Bankers live in the community so will have more appreciation for the idea of renovating an older apartment complex or raising rents in an area that is improving. These issues may be key criteria for you as you evaluate deals and it is a big plus to be on the same page there with your potential sources of financing.
Bankers have a lot of incentive to work with commercial property investors but they are also more traditional in many respects. They will want to see plenty of detail about the property in question and why it is a good investment. They of course have a stake in the deal too and, like all lenders, are really in the business of risk management.
You’ll also want to have some sort of credibility kit or company summary document to add a professional touch to what you present to a banker. A business plan is a must have here so spend some time to create these things (if you haven’t already) and you’ll find that working with bankers will be much easier.
Can you see how your empire can be created without you not having to be a jack of all trades? Just about all highly successful business owners respect and implement the power of delegation and it is wise to pattern your own business accordingly. Follow with me through this series and you’ll continue to see how your own team can help you acquire the apartments you seek and help build the fortune that is out there for the taking!
