Looking to Build an Investment Group to Qualify for Bulk Pricing

41 responses so far ↓

• 1 makes me think /Jun 9, 2009 at 10:29 am  Vote:    

  I’ve always wondered why a group of prospective buyers on this site didn’t get together to target a particular building to negotiate a bulk purchase. I know the logistical nightmare it would create trying to organize a group of individuals (especially the varied personalities we have on this forum). It would seems that someone whould have investigated that possibality especially since there are so many people are waiting on the sidelines for a good deal.

  by the way what is the building in question? Is that top secerete?

• 2 salvador /Jun 9, 2009 at 11:33 am  Vote:    

  Hola. ¿Cuál es el edificio? ¿Es secreto?

• 3 Samson /Jun 9, 2009 at 12:33 pm  Vote:    

  I’d join a group for this purpose.

• 4 Wild Bill /Jun 9, 2009 at 1:41 pm  Vote:    

  You want to spread your risk among different buildings.
  Buy more than one unit in a building and you join failboat.

  Failboat
  A failed organization or group of idiots. Doomed to failure and full of ineptitude, they still continue to sail away on the sea of stupidity.
  In extreme circumstances, one man can be categorized as a failboat in and of his/her self.
  Pictures of capsized or rolled boats usually shown as an example of what happens when the crew does something.

  http://www.threadbombing.com/data/media/30/failboat_arrival.jpg

• 5 Alberto /Jun 9, 2009 at 2:46 pm  Vote:    

  It should be Brickell on The River, please confirm
  Thanks

• 6 makes me think /Jun 9, 2009 at 4:39 pm  Vote:    

  no not brickell on the river.
  sweet deals though. I’m not even in the market but these prices got me thinking, could this be an investment opportunity/chill out spot for the 3-5 times a year I visit? Carry cost is still $600 HOA+ $600 taxes + $100 utilities/incidentals. This should be cash flow positive assuming near full occupancy.

  AJ, you spoke too soon!

• 7 Kramer /Jun 9, 2009 at 5:02 pm  Vote:    

  Alberto he said “High End” of which Brickell On River is not

• 8 shwin /Jun 9, 2009 at 5:30 pm  Vote:    

  If it is 900 B – i am in.

• 9 AJ /Jun 9, 2009 at 6:04 pm  Vote:    

  great idea!

• 10 Joe /Jun 9, 2009 at 6:24 pm  Vote:    

  Can someone put “50% off pre-construction” in perspective relative to today’s prices? It sounds interesting, but I can’t tell how much of a good deal it might be. Thanks.

• 11 kevin /Jun 9, 2009 at 8:24 pm  Vote:    

  Lets see who has the Smart Money. Or the ones who claim they have money put in on it sense they claim they are wealthy.

• 12 jbhmath /Jun 9, 2009 at 8:49 pm  Vote:    

  Can someone tell me what building this is? Thanks.

• 13 elvis in miami /Jun 9, 2009 at 8:53 pm  Vote:    

  yeah, if Miami market has fallen 40%+ in the last 2 years, then 50% off pre construction prices is just a slight discount from today’s prices (more like prices by the end of the year).

• 14 Michael /Jun 9, 2009 at 9:22 pm  Vote:    

  Lucas,

  Based on the purchase price and taking into account all monthly expenses, considering a cash purchase, would this bulk discounted price result in a cash positive investment?

• 15 Renter Tom /Jun 9, 2009 at 10:20 pm  Vote:    

  The discount would have to be significant since prices are still declining and cost to hold are high. The alternative would be to have each person buy one unit and occupy it for min of 3 years might make it worth while. It all comes down to the purchase price people…..

• 16 Danny /Jun 10, 2009 at 7:37 am  Vote:    

  quieck questions:

  what is the average rent per sqf in that building and what will be the purchase price?

• 17 Mr. J L Whinston /Jun 10, 2009 at 8:20 am  Vote:    

  This will seperate the MEN from the BOYS!!!! Money talks and BULLS$@#^walks.

• 18 makes me think /Jun 10, 2009 at 8:53 am  Vote:    

  AJ, did you get to talk to Lucas about the offering?
  I would like to know what you think about this deal. I know you said you did lots of research in this area before you bought so I would like to know your opinion about this deal.

  Anyone else have any feedback about this

• 19 Kramer /Jun 10, 2009 at 9:22 am  Vote:    

  If pre-construction pricing on this building was approx. $400. per sq foot then your buying in at $200. per sq foot on units that are “leftovers”. Jorge Perez Vulture Fund purchased his bulk units at 50 Biscayne for on average $250. per sq foot and the Marina Blue bulk purchase was for on average $200. per sq foot. If the major bulk buyers swarming the market are not buying these units you have to ask yourself why. Not just these particular units but why are they not buying bulk in any of these buildings? Plenty of inventory for sale. It is obvious now that Perez overpaid and the Marina Blue bulk buyers are sitting on inventory with high carrying costs that are rising. Current vulture funds are re-assessing the numbers and not biting. With the huge rental inventory your rents will have to be competetive and Windstorm rates per the Florida Legislature will rise 10% for the next five years. There will be no discount on your property taxes for buying wholesale. So your cash flow at best is break even. Your reward will come only at higher resale prices and your risk is no price appreciation or even worse a further deterioration in pricing.

• 20 makes me think /Jun 10, 2009 at 10:30 am  Vote:    

  Now, I see why some people hate real estate agents……WTF!!!

  Long story long, spotted sweet foreclosure, great home, great neighborhood bank recently dropped price drastically. I told my neighbor if he writes up the contract he can collect the commission, about 4k for him. Easy money, I’m offering several K above asking with no closing cost to seller. I told him he needs to move on it because the bank want to move the property (steep price reduction). 2 days later dude wife’s calling me going over shit I already went over with him. Called him this morning to see what’s the deal with the property becuse it is no longer listed. He plays dumb telling me he is going to look it up. Well I just got of the phone with the listing agent and she tells me she had been in contact with him yesterday. my offer came in 1 hour late they offered the property to someone else and that was communicated to my agent. Listing agent said the person they offered the property to has until this morning to perform otherwise property is mine. I just hope that other agent is as unresponsive as mine. keeping my fingers crossed. I mean how fucking hard is it to focus on one thing for a few hours to make 4K? The guy had to do nothing, I knocked on his front door with this opportunity. Last year I had a similar encounter with another agent. I told her all she had to do was get me in the house and write the contract. Well she did that but when the bank accepted my offer so quickly without a counter I started thinking maybe I could get it for a cheaper price. Well that is when the trouble started, the woman started acting like she was working for the damn bank. She tried to convince me that I was getting a steal and the bank would never accept a lower price. Well I cancelled the contract and wrote another contract (different llc name) behind her back for the much lower price and guess what the bank acccepted it. When they asked me if I had an agent I said no and the listed agent collected both sides of the commission. I felt bad because I know she was a single parent and real estate wasn’t doing much at that time so I dropped off a check for $300 for her time. She was so glad to get that check. When this property came up I though about giving her the deal but I remembered what I went through with her and I though let me give it to someone in my subdivision. I rationalized that maybe it would help keep a struggling realator in his home thereby helping preventing a foreclosure in my hood which would indirectly benefit me by keeping my home value from plunging any further. I know it’s crazy.

  I guess these agents never heard of a bird in the had.

  Oh, my agent just called me back trying to convince me we still have a chance with that house. I told him that house is gone it was too good a deal, the other guy is going to perform. Now he is trying to sell me on some other house, told him no thanks.

  sorry, no one here to vent to!

  FUCK!!!! That was a sweet deal, next time I’m writing my own fucking contract. Fuck who gets the commission.

• 21 Miami2009 /Jun 10, 2009 at 10:45 am  Vote:    

  Wow, makes me think sorry to hear. You would think in these times they would be more aggressive and be on top of any potential sale!

• 22 grrrr /Jun 10, 2009 at 11:00 am  Vote:    

  Same here. It’s very hard to find a competant realtor. A lot of them got their license during the boom and have no clue. By the time I get them to contact the listing agent, the property is already under contract. 3 days to schedule a showing is ridiculous. And you can forget about them showing you other properties. I tell them I want this area and they show me stuff from the other side of town.

• 23 makes me think /Jun 10, 2009 at 11:03 am  Vote:    

  Kramer,
  I don’t know if I agree with your “leftover” statment unless you mean those that haven’t sold. Maybe your argument is valid from an investment standpoint. If you are someone looking to buy and live in this neighborhood then I’m not sure if your argument applies. How often does the little guy buying a single unit to live in get to buy at the same price as the big vulture funds buying 60 units? At some point if you are going to buy, you buy otherwise you will always be sitting on the sidelines. Some people are able to pull the trigger on a deal knowing that there will be consequences (good or bad) and other people are never able to pull the trigger because they are always afraid of negative consequences. I think we all know people like that. Those are the people that never grow because they never test their limits, It called F.E.A.R. (False Evidence Appearing Real)

  along side the big boys who

• 24 elvis in miami /Jun 10, 2009 at 11:11 am  Vote:    

  makes me think:

  I know the problem. We went through 4 real estate agents all of whom kept assuring us it was the time to buy (>1 year ago). We said sure, show us a good deal. After looking at many homes we had a few to put offers on (between 80-90% list price). Our agent said no way, they won’t take it. We said let them tell us that…here are the comps we are using and this is a price above the comps. If they reject and want a counter, please provide a list of comps to justify so we can reevaluate. Needless to say on 4 properties we ended up with none (2 of them had 90%+ list price offers) accepted. One came back 3 months later (right after the market crash Sept 2008) and said they would take us up on our offer, we say $100K less and it is a deal due to recent market conditions and a 8-10% drop in market since our offer. Again, no luck.

  So in the end the agents we worked with did nothing to help us. We asked specifically to look at short sales/foreclosures as well as regular listings. Two agents we worked with extensively and could not get accurate information and we had to argue with our agent to see properties or consider making an offer that lined up with similar houses on the block. Granted, most agents are in the mindset of houses appreciating, negotiations in a declining market are much different.

  I am all for sticking with somebody and not going behind their back, but sometimes you just have to let them learn hard lessons when they don’t even spend an hour of their time to get information you need or back up the information they give you. Oddly enough in every other real estate market I have done transactions in I have never had a problem so bad that I would consider switching agents.

• 25 makes me think /Jun 10, 2009 at 12:19 pm  Vote:    

  I really don’t understand it either. I don’t bother to ask them to take me around to look at houses or bring houses to my attention, I know better than that. I do all the research myself, I just need someone to get me inside the house when i can’t get the code myself. Hell they can stay home and just phone it in all i care.

  I had a similar problem when I bought my current home. I was living up north and decided it was time to move south and settle down. I searched for homes online and had decided on one. I came down here and walked in a real estate office and asked to speak with an agent, any agent. they gave me one of the few that was milling around the office with nothing to do, anyway I pulled out the flyer and told her I wanted to see that house. she couldn’t get intouch with the listing agent so she convinced us she had some other houses that we would like. When we went out to the parking lot this woman had the nerve to tell me that I should drive because she didn’t want to burn the little gas she had left in her truck. Anyway didn’t like the house she showed us but I spotted this neighborhood on the way there and we had this house built. She was so happy that she was finally getting a sale commission, she told us that this will be her first commission and that it was God that sent us into her office because she had been praying about making a sale. She promised that since we were out of state she would stop by the construction site once a week to take pictures and update us on progress. I felt good that we were a blessing to someone. Later that day I told my old collge buddy about the home purchase and he was upset because he said that he could have gotten a friend of his to put the contract on the house and I could use the commission for part of the down pmt. and all I needed to do was give the guy 1k, well that’s all my wife needed to hear. She instantly hated the fact that the agent was making that much commission for essentially doing nothing, not to mention the fact that she didn’t want to burn her gas to drive us to the house. They tried to convince me to cancel the contract even if it meant having to find another house. I did not cancel the contract because it wasn’t the right thing to do and the agent had already told us how important that commission was to her, after all God had ordained it. I didn’t want to get struck down by God. Needless to say, the agent never updated me on the progress of the house. If I wanted to know something I called the builder, when I wanted something changed I called the builder.
  I never heard from her until it was approaching the closing date. She called once to remind me the closing was in a few weeks and the house was looking good and the othertime was to make sure I had closing info/directions to the closing attny. the next time I saw her was at closing to collect her check. Wife still hates her to this day, everytime she mentions her name it is preceeded with a “fucking”.

• 26 Joe /Jun 10, 2009 at 12:50 pm  Vote:    

  No offense to Lucas, who runs a great site here, but I believe the #1 paradigm shift that will come out of this real estate bust is the old “7% or 8% is the standard commission” nonsense finally will die.

  In this day and age, there’s absolutely no reason that selling a piece of property, especially residential property, should cost anywhere near 7% or 8%. The idea that some r.e. agent should get 3.5% or 4% of a $500,000 or $1 million (or more!) sale just for typing the damn entry into the MLS is so absurd it’s laughable. IMO, by the time the next r.e. rally starts to happen, the old “Realtor ™” monopoly/price-fixing scheme will be long dead.

• 27 elvis in miami /Jun 10, 2009 at 1:32 pm  Vote:    

  Joe:

  I wish for the day that real estate transactions can be much simpler. With websites like redfin.com, zillow.com, ziprealty.com, there is momentum to break the old rule of 3%+. Agents do have overhead and currently provide access to MLS and other legal paperwork. In general when closing on a house you still use a real estate lawyer.

  Quite honestly I would be happy paying my 3% commission if the real estate agent worked like a business person (professional, returned calls, kept their word, saw the deal through). This would also assume that they would preview all homes and save a lot of time on my end. But with the internet become a more useful tool, the real estate agent has a much easier and simpler job. It is almost to the point if you are looking to buy you don’t need an agent, just a lawyer for the final paperwork.

  I think what Lucas has going with his blog here is a good step in the right direction for the new future of real estate agents.

• 28 GM /Jun 10, 2009 at 2:39 pm  Vote:    

  I heard Corus took over Paramount Bay. Can anyone confirm?

• 29 Next... /Jun 10, 2009 at 3:11 pm  Vote:    

  Now the question is who will take over Corus…

• 30 jcrimes /Jun 10, 2009 at 5:12 pm  Vote:    

  with all due respect to lucas, i think this idea sucks. there’s a slew of better investments then this.

• 31 AJ /Jun 11, 2009 at 12:51 am  Vote:    

  jcrimes,
  Nyet.
  Read MMT’s no 23. I was going to reply to Kramer but MMT took the words out of my mouth. If there are guys waiting to buy a home to live in, there is no better way to gang up like this and get a bulk pricing. Otherwise no developer will ever talk to you as an individual or give you half off. This is a brilliant idea.

• 32 JL /Jun 11, 2009 at 2:56 am  Vote:    

  Wish Lucas luck but I bet he’ll get a lot of guarantees to perform but nobody will come thru with the cash… Welcome to Miami.

• 33 JL /Jun 11, 2009 at 2:57 am  Vote:    

  So what’s going on with Everglades. They should have a bijillion units hitting the market. Should turn into a big party rental.

• 34 JL /Jun 11, 2009 at 3:10 am  Vote:    

  Last news I see on Everglades is 4/3/09

  http://southflorida.bizjournals.com/southflorida/stories/2009/04/06/focus14.html

• 35 jcrimes /Jun 11, 2009 at 1:56 pm  Vote:    

  AJ
  group, individual, whatever…real estate is not an attractive investment class right now. outside of having a significant discount on the back end, and significant cost efficiencies on the back end, it doesn’t make sense. buying a couple dozend condos in bulk certainly doesn’t get you there. if you want to make a play on housing, a far more liquid and less risky option is to buy some homebuilder stocks or residential reits. hell, if you really want property, buy some cheap ass stuff in the rust belt. but for the love of jesus h. christ, don’t buy condos in the ground zero market for the condo collapse where your purchase price ain’t gonna be that cheap and your carry costs are ridiculous.

• 36 Odd & Sods /Jun 12, 2009 at 2:06 am  Vote:    

  I’ve a better idea, contact the Ace as I heard he has a cash offer in at $125.00

• 37 Odd & Sods /Jun 12, 2009 at 2:36 am  Vote:    

  In every real estate deal that I have transacted I have never used an agent but when a sellers agent has been involved and they come to realize I do not have an agent they always try to represent me the BUYER as well as the SELLER that they already represent!

  When I decline they then tell me that I am leaving money (the other half of the commission ) on the table because the seller pays all the commission. When I explain politely that the seller does not pay a dime in commission they look at me in stunned silence.

  I then ask them a direct question “where does the commission come from”? In some 200 plus real estate deals that I have transacted I never ever had a realtor answer this question correctly.

  Can any of you?

  I’ll repeat the question: Who pays the commission, the Buyer or the Seller?

• 38 AJ /Jun 14, 2009 at 7:59 pm  Vote:    

  Everyone knows it is the buyer who pays the commission. It is included in the sale price.

• 39 Odd & Sods /Jun 15, 2009 at 7:39 am  Vote:    

  AJ I’m impressed as I disagree with most of what you say but you are correct on this one.

  A+ for AJ

• 40 Bulk Condo Opportunity in Brickell » Miami Condos For Sale and Rentals, Miami Condos Investments Blog, Bulk Sales /Jun 27, 2009 at 12:32 am  Vote:    

  [...] On June 9th, I wrote about 53 condo units in a newly completed Downtown Miami condo high-rise that w….  Those 53 condos all went under contract within 2 weeks.  That opportunity has passed but I am now aware of a new opportunity.  This time the development is located in Brickell.  I’m looking for investors with $10M or more in capital with an interest to acquire condos in Miami in bulk.  Contact me at 305-350-9842 for more information. addthis_url = ‘http%3A%2F%2Fwww.miamicondoinvestments.com%2F2009%2F06%2F27%2Fbulk-condo-opportunity-in-brickell%2F’; addthis_title = ‘Bulk+Condo+Opportunity+in+Brickell’; addthis_pub = ‘Lucas25′; [...]

• 41 kiki /Jun 28, 2009 at 6:26 pm  Vote:    

  Extremely interesting…I have been following miami/miami beach real estate for three years now…

  I can say that I am exasperated, that things are now affordable for me on a entering teacher’s pay, but NOT the fees. I don’t understand why so many condo nearby all have own pools etc. Is that not what a great COUNTRY CLUB was designed for. The units would be more cost effective if each did not have saunas and two pools…

  Oh, well just venting. Do you think I can rent a 1/1 for $850-950 in Brickell area? You make me determined NOT to buy, even if I could get a traditional loan! I do not want to live amongst many investor/renters.

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