Whom I Seek to Invest With
I am ALWAYS looking for strong operators with whom I can invest money.
- We Bring the Deal & Capital – You Bring the Construction, Leasing, Management, Reporting. We both bring capital. This is more of a joint venture.
- We Bring the Capital – You bring the deal and run the whole thing. Here I am more of a passive investor-writing a check only.
Here’s what I look for when writing a check into a partnership:
- Track Record – Have they successfully run a few deals full cycle?
- Responsive – If I cannot get a timely text message reply-even on a weekend-I’m not going to write a check. I don’t bother my partners unnecessarily-but I DO expect them to be responsive in the event of emergency while running our deals.
- Tax Advantage – I only invest in real estate deals that offer 1 to 1 depreciation for me, the check writer. This means if I write a $300,000 check, I receive a year one tax write off of $300,000. This is much easier to accomplish now that Bonus Depreciation has been restored.
- Returns – My return requirements depend on WHEN distributions begin
- 1st Quarter of Ownership – If returns begin immediately, I aim for 8% annually in regular distributions on my invested capital. This 8% must come from the cash flow of the deal and NOT capital invested. This means the deal is supporting the distributions-NOT debt. This requires a stronger deal and disciplined operator who is more averse to risk. Upon sale, the total return should exceed 12% annually.
- Year 2 or Year 3 – When distributions begin in Year 2 or Year 3, I aim for 20% returns or more. The entire economy, market, and world order can change in a 2-3 year period, and I want to be rewarded for that risk if things go well.
- Property Characteristics – The last thing on my list is the property itself. It must check out, but is has the lowest priority in my decision making framework in whether to invest.
If you operate commercial real estate deals like this, we should connect. Our smallest check size is $250,000 and we often invest up to $1M or more into joint venture deals.
Here’s What We Buy
- Industrial & Commercial Property, 10K sq. ft. – 250K sq. ft.
- Farmland, 40 Acres or More Tillable & Producing Crops
- Well located Retail Development Sites
- Residential MFR & SFR
- Located anywhere in the U.S.
Recent Portfolio Exit Volume
- 2021 $54,615,000
- 2022 $54,547,000
- 2023 $57,489,000
- 2024 $52,164,000
- 2025 YTD $30,896,000
Industrial IQ Bootcamp with Saul Z
My friend & business partner, Saul Z, is hosting another Industrial IQ Bootcamp in California on Sept 13-14. I went to this event in Chicago and can vouch for the quality & value of attending. I have no affiliation with this event and am receiving no commission if you decide to go. Saul is a solid operator and this event is also solid. If you are at all interested in Small Bay Industrial investing, or perhaps becoming a great operator to whom I’d write checks, this is the event to attend.
