Integrity • Passion • Excellence

By Tom Kirkpatrick

 The other day, I sat down to write up a case study on an apartment complex I own for my website.  An email came in from a commercial broker that I hadn’t spoken to in several months asking me if I might be interested in a portfolio of 3 properties in my local market.  Heck yeah I thought! This is what I’ve been waiting for! This is where the rubber meets the road!  This is what I have been preparing for so I forgot all about my case study and got busy. Remember to be ready when that next deal crosses your desk!

RESPOND QUICKLY.  When you get a deal from a broker, it is important to respond quickly with a thorough evaluation.  The broker is interested in selling the property with the least amount of effort and without inconveniencing the apartment residents any more than necessary.  He only wants to deal with serious potential buyers.  In this case, the broker said this was an off-market deal and he had about 2 weeks to bring an offer, or the owner planned to list the property with a different broker!  You must have a process for evaluating the property based on the information available.   You also need to know what to ask for if key items are missing for your evaluation.  Granted, this is a preliminary evaluation that will be verified during due diligence, but you want to be as thorough as possible with the information provided.  Even if you come up with a price well below asking, communicate your findings to the broker and ask if perhaps you are missing something.  Sometimes the broker knows the price listed is high and needs feedback from prospective buyers to inform the seller for a price reduction.  In my opinion, the keys to being ready to respond when a broker brings you a deal are education, market knowledge and relationships.

EDUCATE YOURSELF.  Education is perhaps the single most important item for the broker to take you seriously.  You must have the fundamental knowledge to be able to speak the multifamily real estate lingo.  You need to be able to analyze the information provided and ask for what is missing (items such as rent roll and trailing 12-month financials (T-12)).  There are a number of books on the subject of multifamily real estate as well as a variety of “gurus” with learning communities (Michael Blank, Rod Klief, Jake & Gino, Dave Lindahl).  In order to complete your evaluation, you need an evaluation tool or spreadsheet.  Likely that is not something you developed yourself, at least not initially.  There are several tools available for evaluating deals.  Michael Blank offers a very detailed tool called the syndicated deal analyzer (  There are others, but the point is, as part of your education, you need to know how to evaluate the deal.

UNDERSTAND THE MARKET.  Next, you either need to have knowledge about the market where the deal is, or have a process in place to quickly evaluate the market. Neal Bawa’s Multifamily University ( offers a Location Magic eWorkshop that provides a method to do this.  Ideally, you already have a fundamental knowledge of the market and can pretty quickly determine if it is a good deal.  Key market data includes items such as:  What is the median income in the submarket?  Is crime a problem in the vicinity of the apartment complex? Are the current rents below market?  How high can you push rents if you renovate units? Will the market support billing utilities (e.g., water) back to residents (RUBS).  Is there a Chik-fil-A nearby (this is important information to George, one of our partners!)?

LEVERAGE RELATIONSHIPS.  It is important that you already have relationships in place to help you fully evaluate the deal.  Key relationships include:

  • Broker: Check…If the broker reached out to you then you have already established a relationship. However, if this is the first time they have sent you a deal, that relationship won’t last long if you don’t respond. A thorough and quick response is the best thing you can do to further develop the broker relationship.
  • Property Manager: For this deal, my local property manager and maintenance man met me to tour the properties (I paid for the maintenance guy’s time and it was very valuable).
  • Finance / loan broker: To help you figure out potential loan terms for your underwriting (a local banker can be very valuable here depending on the size of the asset).  This is super important in a volatile market (e.g., COVID)
  • Insurance agent, contractor: Also will help you sharpen your pencil and pin down costs.
  • Partners: To help evaluate the deal and for joint ventures. Two (or three) heads are better than one!
  • Investors : If you plan to syndicate, you should have already been working on these relationships for a while!

I won’t go into how to develop all these relationships with this post, however, meetups and conferences are a good place to start.  Look for a local REIA meeting or real estate meetup (check  Online meetups are really stepping up their networking game lately.  A friend of mine recently met someone during a post-webinar online networking breakout session and now they are looking for deals to partner on. The Boy Scout Motto is “Be Prepared” and this is good advice for landing your next deal.  You never know when your next big opportunity will present itself.  Invest the time now in education, market analysis and relationships. This will allow you to quickly and confidently provide feedback to the broker and further develop that most important relationship.  I probably won’t get that deal; my offer was much lower than asking price based on a bunch of factors I won’t go into here. But, hopefully based on my thoughtful, thorough response, the broker got some value from my feedback and will think of me next time.  And who knows?  Perhaps he is sending me an email right now with that next deal!

This article has been prepared for informational purposes only, and is not intended to provide, nor should it be relied upon for legal, tax, or accounting advice. You should consult your own legal, tax and accounting professionals. 
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