Summary: We’re spilling all the tea on our latest and greatest apartment syndication deal! Learn the tips and insights that helped us close a $71M deal so you can grow in your own investment journey.
Can we be candid today?
You’re about to get an up close and personal inside look at our latest and greatest apartment syndication deal.
No, seriously!
There’s nooooo better way to learn about investing than by getting a firsthand peek at the process, insights, and wins of experienced investors. Let us tell you, we’ve seen and learned a LOT during the course of our career so far.
Have we made mistakes?
Aaaaabsolutely! But every mistake, success, and lesson has brought us here – coming hot off our biggest, most lucrative syndication deal yet! 🤩🤩
But this isn’t about us. Not really.
Sure. We’re super proud of our successes and have worked REALLY hard for them. Butttt today is about sharing everything we’ve got with you…our fellow passive investors, and like-minded dream chasers.
Our hope is that you can use the knowledge and insights here to grow in your own investment journey and create passive income to help you thrive. So, grab your notebook, gel pens, computer, phone, sticky notes…whatever helps you remember these lessons. Your future self will thank you biiiig time. 🙌
Here’s what we have in store:
✔️ All the deets on our biggest deal (and raise) everrrr.
✔️ 2 – Relationships truly matter.
✔️ 3 – Great leadership makes all the difference.
✔️ 4 – Everything is negotiable.
✔️ 5 – The right strategy is eeeeverything.
✔️ 6 – Rolling deep with a strong squad is a MUST.
All the deets on our biggest deal (and raise) everrrr.
You’re probably about ready to know what the heck we’re soooo pumped about. So, without further ado, let’s get into why this was our best, biggest, and most lucrative deal yet. 😍
As of July 2022, we (along with our awesome passive investors) closed a $71,000,000, a 312-unit, Class-A, 2016 year-built, investment in Houston, Texas.
Yep, you can read it again…we can hardly believe it ourselves.
But the proof is in the pudding, AKA the passive income that has been POURING in for us and our investors.
Now, our previous biggest deal ($40.5M in Atlanta Georgia) closed in Feb 2022. And we are not exaggerating when we say we were hesitant to dive into such a big deal after a crazy couple of years of Covid and economical uncertainty. We had to trust ourselves, our process, and our knowledge to take it on.
And it has literally paid off!
We learned that with the right knowledge, strategy, and team, we could turn uncertainty into a great investment opportunity. Then we used the same approach and mindset to pursue this $71,000,000…
And here we are!
Celebrating the heck out of our success and sharing the top lessons we learned along the way. We hope these lessons can help you find your own investment successes too.
1️⃣ – Class A for AWESOME.
Alright. We looooove us some Class A investments, and they have really become an important part of our investment strategy.
With Class A, you get:
- Newer investment assets with less maintenance
- A strong NOI growth potential
- Multiple exit strategies
- Less risk during a volatile market
Class B and C investments tend to involve older properties, with more maintenance and risk. This doesn’t always mean they won’t make good investments, but with the unstable market we have been facing the past couple years, we wanted as little risk as possible for our investors.
Class A gives the opportunity for increasing value and rent income without heavy construction costs.
Which means more money in our investors’ pockets. 🙌
2️⃣ – Relationships truly matter.
Relationships matter in all areas of life, like a lot. Apartment syndication is no different. We’ve worked with tons of people over the years – some great, some not the right fit for us. So, we’ve learned how much of a difference it can make when relationships work well.
For this deal, we have to give a big, heart-eyes shoutout to our lender, Arbor. 😍
We’ve done 5 loan transactions together and let us just say…Arbor has bent over backwards, cut down commission, and even turned away other investors to allocate capital to us.
Why have they treated us so well?
Simple. Relationships matter. Building a strong rapport with other professionals is SO important in apartment syndication. We value our relationship with Arbor and they feel the same about the Kitti Sisters.
We were able to work together smoothly and successfully on our Ranch at Sienna deal because we trust each other’s track record, execution, and approach.
And that’s why you should start cultivating trustworthy relationships now, so you can feel confident in who’s on your side when it matters most.
3️⃣ – Great leadership makes all the difference.
Our third tip comes from the fact that this deal could have gone sideways, liiiike 8 different times. There were LOTS of unpredictable twists and turns that sent us into some momentary panics. 😅
But you know what we learned through the twists and turns?
We are capable of SO much more than we thought.
You see, multifamily apartment syndication is a team sport. And as the lead general partners, we know how important it is to step up, fill in gaps for our team, and figure things out on the fly.
By continuously showing up and taking the lead, our team felt they could rely on us and trust us. When a tribe can fully trust it’s leaders, amaaaazing things get accomplished!
Liiiike raising 2x the capital we thought we could. 😏
We used strong communication skills, extensive market knowledge, and quick, critical thinking to navigate this deal for our team. Lead sponsors are kinda like the captain of a ship that’s traveling rocky waters and headed for treasure.
Not only did this ship reach its destination, but it also helped us make a sort of map for our next voyages.
We love a treasure analogy AND a win-win. 🤣
4️⃣ – Everything is negotiable.
Negotiating can be a tricky part of apartment syndication because we always want our reputation to stay intact. We never want to be known as the sponsors who ask for re-trades (discounts) for no good reason.
But in this case, we had no choice but to call the seller and negotiate a re-trade. We ended up purchasing a $78M appraised value at $68M – giving us $10M equity from day 1.
When negotiating with a seller, you have to be willing to work with them, while holding true to what’s best for you and your investors. There was some back and forth involved, and lotssss of communication, but we came out with a highly favorable outcome for us all.
The lesson here is that it pays to be confident during any deal negotiations.
5️⃣ – The right strategy is everything.
Our strategy is one we have been using, adjusting, and growing over time. For this deal, it was very helpful to have so much experience under our belts, that we could use our proven methods to make tough decisions simpler.
For example, even though many private equity offers solicited us, we chose our tried and true investment strategy of raising capital from our passive investors.
We also know that unforeseen hiccups happen in apartment syndication (and life) sometimes. So, having a hefty reserve and doing lots of stress tests is our chosen way of staying prepared for anything. Mapping out the worst-case scenarios ahead of time helps us know exactly what to do when bumps arise.
Big fans of stress-tests…NOT stress. 😉
6️⃣ – Rolling deep with a strong squad is a MUST.
We’ve touched on the importance of relationships, but we are all about keeping a strong squad around us at all times.
We couldn’t do what we do without the support of our amazing family and friends, an awesome team, trustworthy lenders, and rockstar passive investors!
It doesn’t just take a village; it takes the right village.
Our squad definitely wasn’t formed over-night. It can take years, trials and errors, and lots of patience and persistence to find your tribe. And we’ve been through all that. But it was all more than worth it…
Because when we arrived at our biggest ever, $71,000,000 deal, our squad was ready to rock. So, this final lesson today is to continue building your squad right now – even if you don’t have deals on the horizon quite yet. The point is to feel confident in your people BEFORE you get to the big money syndication deals.
The results could be life-changing for you. ✨
That’s it for now, friends. If you’re interested in learning more about our strong squad, or want to chat about becoming a passive investor, reach out here!
GET ME ON THE KITTI FREEDOM CLUB
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