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You can't compare yourself to large developers. As I alluded too in another post, large developers are more akin to hedge fund managers except they trade in RE and not in financial instruments. In essence, they try to make a vig on OPM (bank loans) by making profitable bets.
They're playing a totally different game.
But real estate is considered a kind of security, and any large developer is going to be backed by investors looking for ROI. If you have a nice sum of money to invest that can be yield a nice return, getting in with a developer could be the way to go, provided they know what they are doing.
But real estate is considered a kind of security, and any large developer is going to be backed by investors looking for ROI. If you have a nice sum of money to invest that can be yield a nice return, getting in with a developer could be the way to go, provided they know what they are doing.
many pros are private companies or even individuals
Sounds like they are playing a game of 3 Card Monte.
That's literally what many businesses (esp public companies) that want to grow do.
Who would be idiotic enough to dump all of their own money into a large commercial RE venture?
But real estate is considered a kind of security, and any large developer is going to be backed by investors looking for ROI. If you have a nice sum of money to invest that can be yield a nice return, getting in with a developer could be the way to go, provided they know what they are doing.
Maybe for small /medium (lower end) projects. For major projects it's almost always specialized commercial lenders.
Bezos or Musk aren't dumping their money into RE development ventures for yield. It's an opaque and dirty business quite often. Especially in NYC or other large cities.
Maybe for small /medium (lower end) projects. For major projects it's almost always specialized commercial lenders.
Bezos or Musk aren't dumping their money into RE development ventures for yield. It's an opaque and dirty business quite often. Especially in NYC or other large cities.
That's literally what many businesses (esp public companies) that want to grow do.
Who would be idiotic enough to dump all of their own money into a large commercial RE venture?
Many investor groups have no choice but to do cash deals as banks won’t loan them money as a group .
Our apartment sales to the investor group was all cash
But the big guys who do have credit will only use other peoples money.
When we sold the lease rights to ashkenazy group they borrowed 16 million and we financed the 2 million for them which was 10% of the sale over 4 years at libor plus 2% so for them it ended up being no money down at all
Last edited by mathjak107; 05-13-2022 at 04:57 AM..
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