Ventures Update April 2017

695 Riverview Drive

As I branch out into other sectors of the real estate industry, I first want to take an honest look at my first major investment.

The following P&L is for 1Q 2017. See the adjustments below that convert the Net Income to a realistic monthly cash flow. It shows my vision for the property, and hence my enthusiasm since I purchased. I can finally show it on a P&L.

1st Quarter 2017 Actual

Adjustments to Net Income:
+$2500: taxes. This Q’erly P&L includes an entire half year payment.
-$1500: principle payments are not cash flow, just equity.
-$1000: one quarter of insurance paid at once in July.
-$525: 27 rent payments instead of the 28 shown.
= -$525: total adjustments to Net Income.
= $3,945 of actual realistic cash flow for the quarter.

= $1,315 of cash flow per month.

With $102,280 of total cash invested, that is a ~12.8% annual return. That is not a “home run,” that is a “single.”

So why am I happy with this “single”? In the sense that I want to do better in the future, I am not happy with it, but here are some mitigating factors:

  • I have been absent for much of the ownership of the property, and have solved many of the problems with cash, not with my own time. It has truly been passive.
  • I learned to hire a good manager. Much of that $102,280 cash is bumbling around with poor management. I have learned from my professional manager, Panzera Realty, about landlording and management since hiring them in Nov 2015.
  • The property continues to improve. The condition is better every year
  • We continue to cut expenses and raise rents with the market. This year we will sub-meter the water, and new units will rent without wall air conditioning units included. Even with these changes combined, we expect the same rent from the new tenants.
  • My original goal was to learn.
  • 9% matches the market.
  • We are well positioned for an economic downturn with a quality property at reasonable rental rates.

Columbus, Ohio Occupation

Real Estate Agent

I love it so far. It puts you on the inside. A must for full-time real estate career. New website! …

Uber Driver

Fun. More than pays for gas, but a waste of time. I drive a couple times a month still. I hope I always do. I do enjoy it.

Handyman

I will probably always do some handyman work. I enjoy it.

Kineomen

The holding company in North Carolina is positioning to invest in some sector of the real estate industry. Probably non-performing mortgage loans (NPLs).

Click here for info on NPLs. More details in a future post.

Simple-Kneads Gluten-Free Bread

We have a shareholder meeting at the end of this month. There is investment opportunity currently. Your only commitment is to sign an NDA. I do recommend.

Vino de Coco

I still plan on going there in person as soon as possible.

The Stock Market

I’m still out of the stock market.

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