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IN THE HOUSE
This is a textbook example of a couple who believe in real estateand are doing what many investorswish they had done.
OKLAHOMA
Danny and Amber Newberryrecently closed on a 48-unit mul-tifamily property they describe asa C+ property in an improving Cneighborhood in Oklahoma City.The first phase of a new mall has
outperformed retail expectations,and the developers have acceleratedPhases 2 & 3. A Super WalMart andother big boxes are moving into thearea.
The Newberrys bought thisunder-tenanted property from adelinquent, absentee San Franciscoowner for $15 a square foot. Withpartners, they put $50,000 down ona $700,000 property, expecting toinvest $350,000 in renovation.
“The local management had
been Band-Aiding everything,” saysDanny. “We needed to re-clad theexterior, bring the nine out-of-ser-vice apartments to rental conditionand resurface the parking lot. Wemoved from our Cedar City, Utah,home to oversee the renovation andproperty management until we getthe property to where it needs to be.”
OUT OF SERVICE & NO PLAN
The former owner had accepteda 60% occupancy, so the propertywas only generating $55,000 in netincome. “By renovating the prop-erty and bringing all of the units toproduction, we have increased thenet to $155,000 a year,” says Danny.
“Accepting ‘down units’ would havemeant accepting $60,000 in lostincome. We are bringing one of
these idle apartments on line everytwo weeks. Since we took over inOctober 2012, we have brought rentsto market and will have this lostcapacity back by March.”
Renovating the property, hesays, has doubled the after-repairvalue from $15 a foot to $30 a foot.
“And then by increasing the netoperating income with all 48 unitsavailable, we will have increasedthe appraised value to a conserva-tive $1.6 million or more.”
Market rateS & Pet PreMiuM These are desirable 900-square-
foot, 2 bed/one bath apartmentsnow rented at around $550 a month
– up from $450. A $15 pet premium
helps because of a new a dog runthe Newberrys have installed.Danny and Amber are from
Cedar City in Southern Utah, aboutan hour north of Las Vegas. Dannyhas always liked the idea of buyinghomes. He bought his first foreclo-sure six years ago, cleaned it up andrented it. He then bought a nearlyvacant six-plex for $25,000 a door. Herenovated with contractors, spend-ing $6,000 per unit. The after-repaircost (ARC) of $31,000 became an
after-repair value (ARV) of $50,000a door, increasing the valuation to$300,000.
“I favored four-plexs,” saysDanny. “I also bought a triplex andduplex and a 10-unit property inLas Vegas. Starting out, family andfriends helped with financing and
CASE STUDY –
“READ THIS TO THE END!”
Can you guess the ages of
these “old hands” at realestate investing?
(The answer is on Page 104.)
All Property Management is a lead
provider of property management connectio
on the Web. In a move to improve investor aowner experiences with its network of prope
managers, the company has instituted an annVisitors’ Choice Award.
The 2012 charter awards are given to 2property management co
panies that were selected t
most often by the more th2 million rental property o
ers who visited All Prope
Management’s website l
year.“Connecting rental property owners w
the right management solutions is the core
our business,” said Reggie Brown, CEO of Property Management. “The companies rec
ing this award are particularly skilled at handlhigh volumes of new business, and as such, te
to be some of the most experienced managersour network. The reason we did this is to rec
nize companies that provide exemplary serv
The best rise to the top because they have tgreatest customer conversion rates because
best customer facing skills. We are doing t
to recognize our best property managers, b
practices as a property management distinctand raise industry standards generally.”
Since APM began in 2004 the company h
made more than 100,000 connections betwe
rental property owners and property manament companies.
APM focuses on helping property owne
maximize their rental potential through sharresources and introductions to local prope
management experts that fit their service nee
and property types.In November 2010, the company was p
chased by an investment group led by form
Microsoft executive and founder of Walksco
and All Star Directories, Mike Mathieu. Undthis new ownership, the company now has
employees and is aggressively building on
industry leadership by expanding its online nwork, products and resources designed to c
nect property owners and managers nationwi
All Property Management
Reggie Brown, CEO
206-577-0029www.allpropertymanagement.com
APM’s ‘Visitors’ Choice Awardsspotlight top property managers
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advice. I preferred distressed proper-ties, as there is a greater upside. We
prefer professional management atall of our properties except for theon-site Oklahoma project we are nowinvolved in. We plan to live on-sitefor the first few months to renovateand learn the property, then pass theresponsibility to a professional prop-erty manager.”
Starting right Here’s the kicker: Amber is 23 and
Danny is 24, and they control 89 rent-al doors (SFDs and multifamily). At 18,
Danny decided that working for hisdad in a used-computer export busi-ness was not for him.
“Beyond just a good financialresult, the satisfaction of doing a great job turning around a building andhelping tenants provides us deep sat-isfaction,” says Amber, “and it’s lotsof fun to be your own boss.” NeitherDanny nor Amber was born with asilver spoon in his/her mouth, but both have the support of their fami-lies. They began as high school sweet-hearts when she was a sophomoreand Danny was a junior. Danny didhis first deal in Cedar City at 18 andgot hooked. When asked how they’ve been able to succeed in a tough econ-omy, Danny says, “There is no magic, just planning, analysis and persever-ance.”
The Newberrys are no newcomersto real estate investing, even thoughAmber is just 23 and Danny is 24.
IN THE HOUSE
WELCOME ABOARD
THE BOARDWil l iam Leider has joined
NEXZUS Publishing Group as
Board Chairman. NEXZUS pub-
lishes Personal Real Estate Investor
Magazine, the emerging voice of anemerging industry. NEXZUS also
promotes the leading investmentprovider event Investor Provider
Leadership Summit.
Leider has served as CEO of sev-
eral public and private companies.He brings more than 35 years as a
strategic consultant to a variety of
organizations, from Fortune 500s toentrepreneurial startups and every-
thing in between including Toshiba,
KPMG Peat Marwick, Thermador,
Paramount Pictures and Oracle.Leider is the author of the break-
through book, “Brand Delusions.” By
way of allegories, Leider demon-strates how companies can be blind
to their brand deficiencies. “Brand
Delusions” shows how to spot these
shortcomings and then strengthen abrand to become more successful.
“Execution of basic principles
and processes that embrace the term‘brand’ is more than an image, identity
and message,” says Leider. “A brand
is a widely held set of beliefs and
expectations about what you deliverand how you deliver it.
“I believe that personal real
estate investing is an emerging cor-nerstone of financial independence
for all individual investors and neces-
sary to protecting retirement income
in our society,” Leider says. “I believethat Personal Real Estate Investor
Magazine is a powerful investment
advocate and leading voice for thisemerging asset class. I am thrilled to
be a part of this.”
“Leider is a perfect fit for both themagazine and the industry at large,”says PREIM Publisher Andrew Waite.
“Bill has an innate understandingof ‘brand,’ brand positioning and pro-motion and the importance that must
play in the effort to make personal
real estate investing recognized and
accepted as the mainstream inve
ment that it is,” said Managing Edi
Linda Wienandt. “His expertise
strategic leadership helps our pucation and the emerging industry th
we cover.”
Leider says he eagerly accepted t
challenge of helping the magazine
its mission to be a watchdog of t
personal real estate investing indtry as it matures.
“What I like a lot is the magazine
position and ability to contribute togrowing body of knowledge on a ve
practical level,” he says. “It strives
continuously write about topics of c
rent relevance to not only investo
but also to people and organizatiothat work in that realm and who
work supports the whole concept personal real estate investment.
“THE BOTTOM LinE is:
iT CAn HELp pEOpLE.”
Leider is looking forward to me
ing those people whose efforts a
moving the industry forward. He cbe reached at 602-241-0800, e
130, or by emailing william.leider
nexzuspub.com.
He will be in attendance the Spring 2013 Investor Provid
Leadership Summit scheduled
be held in Baltimore April 25 an26, 2013. This event precedes t
REIExpo April 27-28 at the sam
location. To register, go to ww
PersonalRealEstateInvestorMag.
William Leider
