US investing story

From: Kellie Dutton


Mike you wanted to know, and for the others that have expressed interest here's the story

It is extremely difficult for non US residents to invest there. Everything revolves around social security numbers including lender computer systems and without one the operators simply go into error mode. So, after opening bank accounts with the only intelligent bank employee we could find, establishing an LLC, and obtaining a quasi ssn we were somewhat ready to go.

Found a 68 unit apartment complex in Miami (several actually) with good returns. Most Lenders will only do 75% on commercial stuff there and lucky to do that being an LLC with non resident alien Directors.

Spent considerable time speaking to venture capital firms, some of who considered the deal(s) until it got too difficult. After re-assessing the financials on their terms the NOI wasn't acceptable on some blocks.

Finally found a complex that was going to work but finance just wasn't happening until I found a lender in New York who would do it. Then needed more than 75% as the dollar was dropping by the day. Decided to go the whole way and get 100% Did it with a ground lease that covered 25% and leasehold mortgage for the remainder. Leasehold mortgages sit second to ground lease which was another huge problem. Leasehold mortgages are the T-bill rate plus about 250 points. I found one who would do it with 235 points on top. So we had approval for the ground lease in writing and conditional on other and were maybe 2 weeks off settlement for the leasehold when the fed put rates up. The biggest problem was that the ground lease rate rose aswell and having that cost included in operating expenses the NOI was suddenly not looking so good aside from the fact the leasehold rate was looking huge.

So that's what happened, ground lease and leasehold are expensive so fees, appraisal costs, full environmental survey etc etc etc the total cost would have been around AUS$50K. Mind you it was returning US$120K per annum for each of us (2 that is).

Another interesting point in the States is that refundable down payments are not always refundable, even if the contract says they are.

Contract stated very clearly that should financing not be obtained the good faith deposit that was made was refundable.

In the US if someone makes a claim on money in Escrow, whether they have any claim to make, then it won't be released. This happened, the vendor made a claim on it. So it then had to go through the Florida Real Estate Commission who, after many many months of having a file on this, stated that they could not make a ruling on this matter because it was a factual case. The vendor clearly had no claim and the money should have been refunded but because of those facts they were unable to release it and it then became a civil matter. Have to sue him over it, which is currently still going on in Florida courts.

Anyway there it is

Kellie
 
Last edited by a moderator:
W

WebBoard

Guest
Reply: 1
From: Tony Lane


Kellie, great story - thanks.

You've probably developed a contact or 2 after this - ever considered putting a syndicate together who may be interested in a bit of off-shore action as a means of spreading risk?

Good luck with the next one

TL
 
Last edited by a moderator:
Reply: 1.1
From: Kellie Dutton


Thanks Tony

Thought crossed my mind a while ago to give it another go with a group of people but hadn't taken it any further. Worth more serious thought though. Ta
Kellie
 
Last edited by a moderator:
Reply: 2
From: Ross Sondergeld


Hi Kellie,


Subject: US investing story


Good to hear the story...

If you looking for some real estate advice and/or counselling in the USA.
I'd recommend Bill Broadbent, California, USA.

Bill's a vendor finance wiz and he does many creative r/e things...

(Go to goolge and type "creative real estate solutions")


P.S. Bill charges flat fee, by the hour, etc for counselling.



Ross Sondergeld ~ Buyer Agent

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
" Imagine buying real estate the easy way...
...with a Buyer Agent on your side!!! "

Buyerside Real Estate Mobile 0412 289 464
Office 9b, 34 Glenferrie Drive Office (07) 5562 1555
East Quay Corporate Park Fax (07) 5562 1248
Robina QLD 4226, Gold Coast Buyerside@hotmail.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


_________________________________________________________________
Join the world’s largest e-mail service with MSN Hotmail.
http://www.hotmail.com
 
Last edited by a moderator:
US investing story (...continued)

Reply: 3
From: Ross Sondergeld


Hi Kellie,


Subject: US investing story


Oh yeh... i forgot to say...

Bill Broadbent is the GREAT GRANDADDY of "Buyer Agency" in the USA.

So be nice to him...




Ross Sondergeld ~ Buyer Agent

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
" Imagine buying real estate the easy way...
...with a Buyer Agent on your side!!! "

Buyerside Real Estate Mobile 0412 289 464
Office 9b, 34 Glenferrie Drive Office (07) 5562 1555
East Quay Corporate Park Fax (07) 5562 1248
Robina QLD 4226, Gold Coast Buyerside@hotmail.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


_________________________________________________________________
Send and receive Hotmail on your mobile device: http://mobile.msn.com
 
Last edited by a moderator:
US investing story (...continued)

Reply: 3.1
From: Jeremy Laws


We have our own agent in Ca. Invested $2m so far and it keeps getting better, I have heard of Bills name before, but mine hasn't put a foot wrong so far!
 
Last edited by a moderator:
US investing story (...continued)

Reply: 3.1.1
From: Kellie Dutton


Thanks Ross

Can never have too many contacts in the alienating world of the US.
Have you got any contact details for him?
Ta
Kellie
 
Last edited by a moderator:
USA HELP - www.arnettbroadbent.com

Reply: 2.1
From: Ross Sondergeld


Hi,


Bill Broadbent www.arnettbroadbent.com


Bill does vendor finance, buyer agency, property counselling, buys/sells
mortgages, trades and anything on the creative angle.


Good source of information if you're looking to get into the USA market.


You can pay Bill by the hour, flat fee, percentage... He does stuff all over
the place for "buyer clients".


Great guy...




Ross Sondergeld ~ Buyer Agent

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
" Imagine buying real estate the easy way...
...with a Buyer Agent on your side!!! "

Buyerside Real Estate Mobile 0412 289 464
Office 9b, 34 Glenferrie Drive Office (07) 5562 1555
East Quay Corporate Park Fax (07) 5562 1248
Robina QLD 4226, Gold Coast Buyerside@hotmail.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


_________________________________________________________________
Chat with friends online, try MSN Messenger: http://messenger.msn.com
 
Last edited by a moderator:
Top