YIMBYs Overlook Investor Struggles, Developers Become Landlords
Sincerely do appreciate YIMBYs, but: Their seeming blindness to the impact on development of the hostile operating environment experienced by the investors who own and operate rental buildings in CA is really starting to grate on me. **Every developer is either a landlord-in-waiting or hoping to sell to one.**
AI Makes Generalist Skills More Valuable Than Ever
Changed my mind: I used to think it was dumb for young people to think of, and describe themselves as, generalists, bc the world tends to reward specialization. However, due to AI, the future of the economy is more uncertain now than...
Vacant Space Gets No Tax Break; Fix Crime, Homelessness
Contrary to what many people seem to believe, there is no tax incentive to keep space vacant. If you want more retail in Downtown LA, focus on the forces preventing entrepreneurs from opening new businesses there: Crime, disorder, homelessness, and so...
Growth Requires Homeownership Path, Not Just Rent Control
One thing I think a lot of YIMBYs miss: It's not just about the rents. If you want a growing city that is attractive to upwardly mobile people and the companies that employ them, you need to create a viable path to...
Negotiated Garage Reduction Restores Blocked Alley Access
Once built a 4plex where the design required parking access through an alley like this. The problem was that the neighbor on the other side of the alley had illegally expanded his garage to annex like ~50% of the width of...
Housing Crisis Needs Collective Action, Not Solo Hero
One of the things that bug me about how he uses language is this insistence that *he* is going to build all the homes. In fact, if we are going to build hundreds of thousands or millions of new homes in...
Dallas Rents Dip, Homes Stay Affordable—Perfect Buyer Window
I toured some Dallas buildings recently. Was *shocking* how nice of an apartment you can get for $1200-1300. Combine that with the fact that you can still buy a house in the suburbs for $400k, and you can see why so...
Cut Medicaid Fraud, Not Add Wealth Tax
The expressed rationale for SEIU's proposed wealth tax is to replace the roughly $20b / yr in Medicaid $$ the federal govt recently stripped from CA. Maybe instead of enacting yet another tax, which is already driving our ~most productive residents...
Tenants See NNN and Base Rent as One Cost
Want to clear up this common misconception about commercial leases. It is true that NNN leases put responsibility for paying property taxes on commercial tenants, and that increased property taxes will initially be passed through from landlords to tenants. However, from the...
Study Claims 5% Tax Won’t Curb LA Housing Supply
Remember when those idiots at UCLA published the paper showing that taxing away 5% of the gross sale proceeds of every piece of real estate in LA >$5MM wouldn't impact housing production?
Closed First Industrial Deal, Now Seeking Next Partner
Closed our first industrial deal with some long-term partners of ours a few weeks ago. Now on the hunt for another. [Apologies to the broker whose backside is prominently featured below] https://t.co/nHz7lw2qqf
If You Hate Raising Money, You Hate Real Estate
Early in my career, hated raising $. Thought it was beneath me & that the deals should speak for themselves. Dumb & self-defeating. Real estate is among the ~most capital-intensive businesses. Unless you're @loganjrankin, if you hate raising $, you hate the...
Management's Complex Systems, Low Margins, No Excuse
Management is *so* hard... you need to create like 50 different systems, make sure they keep running ~perfectly month after month, then deal with the exceptions to ~all of them that randomly crop up, all w very low revenue per...
Launching Phoenix Property Management: Hiring First Team Member
Getting more serious about a potential expansion of our property management business to Phoenix. Looking to hire our first employee there, who will help me launch and grow the business, while also managing our initial batch of properties. Link to the job...
Twitter's Memetic Power Fuels Policy; Toxic Bots Profit
The daily discussion on X helps shape the national mood, which in turn shapes purchasing decisions, corporate capital allocation, votes (and, thereby, economic policy, war and peace, etc.) and so on. (This is a big part of Elon's rationale for buying...
LA Housing Authority Launches Active RFP for Management
This is from an active RFP for managing housing on behalf of the Housing Authority of the City of Los Angeles https://t.co/9nka8Quvyt
Lead Magnet Finally Tried, Email List Grew
For >10 yrs, I have been reading advice in various places to put a lead magnet on my personal website, in order to capture more email addresses. I finally took this advice approximately one month ago and, perhaps unsurprisingly, it worked. Follow...
Free Due Diligence Checklist for Multifamily Rehab Deals
Reminder: The due diligence checklist we developed over >100 multifamily rehab deals is available for download for free (bc I'd like to grow my mailing list). What's a due diligence checklist? It's a list of the potential risks you need to...
New Bill Threatens Rental Development, Spurs Fraud Concerns
Perfect example of a bill introduced in the CA legislature that would make running apartments more difficult, and therefore slow housing development (bc every developer of rentals is either a landlord-in-waiting or hoping to sell to one.) When we briefly allowed...
Developer Incentives Drive Unwise Construction, Fueled by Investor Money
What ~everyone in this debate misses: Institutional developers, who build most new supply (at least in large metros), aren't using their own $$. They are using investor $$. And the terms of the deals give them large developer fees, which are generally...
Buffett Letters Teach Trust, Not Just Value Investing
The reason I strongly recommend young people interested in business read the Buffett letters: It’s *not* to turn them into little value investors. It’s to socialize them into the “seamless web of deserved trust” way of thinking about business (&...
AI Era Sparks Surge in PE Property Deals
Sign of the (AI?) times: Currently receiving ~3 emails per week from PE trying to buy our property management business
Removing Harsh Advice Protects New Wealth Recipients
[Deleted a somewhat mean-spirited reply regarding, let's call it, asset allocation for a newly rich inheritor that was getting way too much traction for comfort.]
Prefer Partnerships with One Legal Decision‑Maker to Avoid Conflict
Having been part of both types: My strong preference is only to participate in partnerships where there is one, clear, legally-designated decision-maker. Otherwise, too much chance strategic disagreements linger & fester.
My Missed Multifamily Investment Dwarfs Employee Errors
Any time one of our employees makes a mistake, I remind myself: No mistake any of them could make would come *close* to costing us as much money as my decision not to buy multifamily in secondary Western markets 2015-2018.
Personal Lease Sign‑Off Saves Owners Thousands Every Years
Why I still sign every lease in our ~1200 unit portfolio personally: Bc, about once every 2-3 yrs, I catch an incorrect rental amount, which would have cost the owner: 1. Hundreds or thousands of $$$ in forgone rent and, 2. In...
Zero Rates Spark Price Spikes, Then Rent Collapse
File under: Wish someone had told me When interest rates go to zero, the main reason to sell real estate is bc pricing goes crazy. But a secondary reason to sell is that interest rates at zero will catalyze a development boom,...
Trustworthy Property Management: A Timeless Business
Why I love our property management business: People have been building & renting out apartments at least since the Roman Empire, managing them is painful, and many owners are happy to pay someone trustworthy to do it. That’s Lindy.
Offshore Call Centers Hurt LA Brokers' Reputation
The LA apartment brokers hiring untrained, poorly spoken, off-shore call center workers to cold call owners hunting for sale listings are doing serious damage to their reputations.
Key Questions to Vet Your First Industrial Leasing Broker
What are some good questions to ask industrial leasing brokers, for someone just getting into hiring industrial leasing brokers?
Reclassify Starter Home Profits to Spur Millions of Homes
Instead, we should change the tax treatment of development of for-sale starter homes from "income" to "capital gains"
National Chains Threaten Neighborhood Charm Through Collective Rent Choices
“Tragedy of the commons” in interesting neighborhoods: Each individual owner incentivized to rent to national chains, due to their higher credit-quality. But, once too many do, the neighborhood loses what made it interesting in the first place.
Housing Access Could Fix America's Biggest Problems
Most of what's wrong w America could be solved by making it possible for normal, reasonably hard-working people to purchase a home.
Cut Rents, Not Vacancies, in a Slow Market
Unless you’re angling to sell or refinance your building in the short term: If the rental market is slow, better to lower your asking rents than to accept vacancy or fill your building with people who will dishonor their lease obligations.
In‑house Construction Risks Marginal Deals During Pipeline Lulls
As a value-add real estate operator or developer with a rapidly growing deal pipeline, can be *very* tempting to in-house the construction function. The upsides are: more transparency around pricing, more control and (if you do it well) some additional profit. However,...
Scale Value‑Add Projects to Your Current Capacity
Excellent post From the GP's perspective, it is *so* tempting to view each value-add deal in isolation and make a go-no go decision based on that deal's projected returns. But you don't have infinitely many "Number 1" contractors, "Number 1" project managers,...
New Book Empowers Early‑Career Professionals Into Lucrative Real Estate
When a (smart, accomplished) friend puts in the effort to write a book, I buy the book
Austin’s Housing Surge Fueled by Rent‑control Ban
What many YIMBYs miss about the Austin housing supply miracle: Investors were willing to capitalize that construction, in part, bc, except in cases of *actual* emergency, Texas bans rent control at the state level. https://t.co/rl9bpQ94Cx
Cities Must Signal Long-Term Investor Confidence, Not Just Regulations
Fact 1: On today's numbers, apartment buildings take 15-20 yrs to pay back the investment in building them. Fact 2: To justify that investment, investors need to expect the buildings to generate returns for decades thereafter. So, if your city wants private...
Add Bedrooms, Boost Rent per Sq Ft in Tight Markets
A game-plan that works in supply constrained markets: Identify older buildings with apartments that are too large relative to the number of beds and baths they have (for example a 1,000 sq ft one bed). During renovation, using permits, reconfigure the units...
Revealing Our Decade-Long Real Estate Due Diligence Blueprint
The Crown Jewel Regular readers know that we created our original due diligence checklist in ~'14, on the advice of an experienced real estate investor who became our largest 3rd party property management client. (What's a "due diligence checklist"? It's a long...
Location Beats Building Condition: Vision Can't Fix Bad Sites
Doesn’t matter how ugly, run-down or obsolete a building is: If the post-rehab rent or sale price is sufficiently high to justify the expense, you can figure out how to fix it, w enough vision & capital. On the other...
ReSeedPartners Hits ‘Default Alive’ Milestone, Validating Model
Very good post @ReSeedPartners, the platform some partners and I started ~3 yrs ago to seed emerging real estate operators, recently reached "default alive", reminding me yet again how powerful a position that is
Essential Guide to Private Real Estate Incentives
If you are just learning about the private real estate business, either as a prospective GP or LP, please read this short book. It’s a pretty balanced explanation of the game, including the incentives driving the different players. https://t.co/3pvXJikrV5
Structured Sales Protect Sellers; Buyers Should Disrupt Them
So nuts. The most important thing a listing agent does is run a structured sale process, so that: 1. All prospective bidders feel like they have a shot, if they put their best foot forward, & 2. The seller can systematically, calmly...