There are a number of different ways to get your multifamily investing career off the ground. You might choose to buy a small property with your own money or learn the business as a passive investor in a syndication. You could take on the role of syndicator and partner with an experienced team or get in the game as a capital raiser. So, what are the benefits to each of these strategies? Which approach provides the quickest route to financial freedom? And how can you leverage the power of joint ventures to invest in bigger deals early on?
Jens Nielsen is the principal at Open Doors Capital, a private equity firm out of Durango, Colorado, that helps people passively invest in real estate. In just three years, he has raised nearly $1M for multifamily deals and invested in 800-plus apartment units. Jens has a talent for assessing risk and assembling the right team to renovate and operate multifamily properties, and he has utilized a variety of strategies to build an impressive portfolio—while working a full-time job in IT.
Today, Jens joins me to explain how his lack of faith in the stock market led him to develop an entrepreneurial mindset and become a multifamily investor. He walks us through his journey and each of the strategies he utilized, from buying a fourplex on his own to a seller financing deal to raising capital for syndications. Listen in for Jens’ insight around the benefits of getting started through passive investing and learn his unique approach to raising money by way of a joint venture!
Key Takeaways
Jens’ path to multifamily investing
- Successful career in IT but afraid to count on 401(k)
- Build passive income streams to secure financial future
How to develop an entrepreneurial mindset
- Realize idea of job security = myth
- Get educated and grow risk muscle
Jens’ first real estate deal
- Bought fourplex in Albuquerque, NM with own money
- Rehab units + new roof for cashflow of $800/month
How everyone wins in a seller financing deal
- Lower taxes and interest rate benefits seller
- Small down payment + monthly payments
Jens’ 38-unit joint venture deal
- Negotiated price down from $1.6M to $1.2M
- Sellers came in undercapitalized, losing money
- Jens halfway through $10K/door renovation
The roles and responsibilities of Jens’ team
- Jens does underwriting, due diligence and budget
- Partner focuses on renovations and management
How to shift into the role of raising money for deals
- Position self as investor and nurture relationships
- Present deals in logical way and discuss benefits
The advantages of investing in a multifamily syndication
- Much easier to scale + more reliable return
- Opportunity to expand influence, network
Jens’ advice for aspiring real estate investors
- Consider passive investments in bigger deals
- Be careful about self-managing properties
How to prepare for the role of raising capital for multifamily
- Surround self with peer group just ahead of you
- Use team approach to raise money for syndicator
Connect with Jens
Email [email protected]
Resources
Podcast Show Notes
