business plan

[eldorado]

Hi Dan,
Great job on this site, I wish I found it earlier
Was referred here by John Michael
I was on "the Creatrive Investor Site" but I think I just found a new home..
I have a delimina
I'm constructing a buisness plan for a foreign investor
20 mil,30% equity share,qtrly dividends,after 5yrs i get a 4% interest only mortgage

(NO! It's not Nigerian or Saudi or south africa front money scams)

I'm having a problem with the financial section. (20 mil)
How do you calculate a average ROI, NOI, per 1 Mil spent??
I just bought a 24 unit with 85-90K Income and 40K expenses-
I paid 350K- it appraised for 450K-.10 cap
I live in western Illinois and plan to invest in the Chicago area but am not locked into it.
Cap rates vary..how do you tell which apply for each area?
Is there a "norm" i can use for an example?
Has anyone ever done a buisness plan for real-estate investmenet-cause I sure can't find a template for one.
I plan on going after multi-unit residential with management and pay cash
Any help out there??

[Dan Auito]

Well Eldorado, let me first say that it is great to have you here with us. :SM139: Secondly you're probably a little more sophisticated then I am in certain respects, but I won't hold that against you either!

What I would do first is go to the local apartment owners assoc meeting that own properties where you want to invest and ask them what rent to value ratios they are getting and then start to develope the average cap rate that way, also a few commercial R.E. brokers should be able to provide some estimates as well based on recent sales.

As far as a real estate investors business plan, I think if you can define exactly how it is that you intend on capitalizing on your markets, then detail that along with what you are willing to guarantee prospective partners then your half way home on that one.

There are some great, individual documents floating round the web that refer to doing individual facets of the trade, I think a combination of the pertinent ones regarding your specific plans could be combined to present your proposal to the deep pockets out there.

Not a very technical response from me here as I am just approaching this phase in my own right, I would be very interested in hearing more ideas and insights into producing such and outline myself. :SM129:

Here are a few steps that may help you with your outline;
1. Outline your business objectives, example: Eldorado properties is in the business of locating, acquiring and completing necessary repairs on SFH'S, small apt complexes and commercial properties valued under $1,000,000 we make our profits by (your methods here)

2. Outline who the members of your team are: Our support team consists of:
Joe schmoe title co
Our attorneys are:
Home inspector is:
Appraisers are: Brokers are:
Contractors are:

Then plumbers, electricians, and so forth, everyone who's name and company you can document and tell the investor about who will be reachable if questions need further answers.

3.A list of your pending , in progress and completed transactions that show your past, present and future operational picture.

4. Your formal request for financing with your proposed returns and when they will come due, how they will be paid and assurances if any(1st mortgage, 2nd, promissary notes etc...

5. A list of current debt's , loans paid off, testimonial letters from satisfied lenders in the past, a full report on your current credit standing etc...

6. A list of comparable sales to the property that your proposal for financing is being submitted for.

7. All data pertaining to the property including time lines for repairs, projected sales price, potential buyers and sales histories of similar properties etc...

By giving people a logical flow of what you do, propose to do, have done and want to do next backed up by history, facts, accurate projections and an action plan, I don't see why they wouldn't at least entertain someones reasonable request when put together in a professional presentation package!

O.K. Folks we are in search of your zip files, word docs, attachments, web links, insights, ideas and further suggestions in hopes of gaining perspective into the above request!

That's my two cents. Next

Big John Michael has a great example of what we are looking for in the following post! http://www.magicbullets.com/forum/showthread.php?t=377


Let's see those pro's hit the boards! :praise:

[eldorado]

Thanks Dan, :thumbsup:

I have already completed most of what you previously mentioned

Executive Summary
Company Profile
Management Summary
Personal financials
Deals Completed
Goals
Contacts
Marketing Plan
Costs approach
Prequalifications
Target Market

It's the financial...and Only the financial sections that has me somewhat stumpped...

I have copies for someone to review.(e-mail) :mail:

I'd love some criticism on the content

John Michaels downloads are helpful for future reference-especially the property evualation format.

I'll keep cruising the site for more info-thanks

[Just Information]

Let's look at the package and see how it will appeal to investors.

We now have something to work with - it's hard to see your vision based upon your post.

Email me that data and let's take it to the next level.

Take care,

[REIaddicted]

Would it be possible to have a download of the completed package ( xxxxxx out the personal and addresses, ext) so we can all see an example?

Thanks,
Lisa

[eldorado]

Well, Let's give this a try.

There seem to be some Corel plug-ins with the new MS Word, So you may or may not have problems in opening it.

Hey, It Worked!!..I had to change to PDF format.

Not concerned about private info as It's necessary to illustrate the doc in it's accuracy

Besides wer'e all family here Eh?:rockon:

[eldorado]

Remember, It's not complete= A work in progress.

I Certainly welcome your comments and suggestions

:smiley11: :rockon::cussing: :SM036:

Whatever they may be...

[Dan Auito]

One word: FABULOUS! I only saw a couple typo's on pg5 so have a look see at that again but otherwise this is something anyone could be proud of.

One thing that personally made me step back (just a little) is the Panama registration, offshore entities give me an unstable gut feeling kind of instinct thing, but I know your doing it for protection so I suppose a lender may also view it as such.

Now where did you get this template, I just have to have it! :SM117:

I think you are on track to creating an excellent presentation, now once you put the prospective properties into the mix I think you'll have whomevers attention that you desire.

Excellent job and thank you so much for putting it out here for review and comment! Dan :praise:

[eldorado]

Thanks Dan,
I know about the typo's (it's not proofed yet)and I gots to get rid of some of dem dere grammetical errors as well. LOL :eek:

The template is a copulation of several buisness plan templates that I merged together. (MsWord,B Plan pro,Hurdle,B Plan Chef and others) :SM088:

Most plans are geared toward marketing/manufacturing a product so they are useless for this application.

The next step is to figure an average income per 500k / 1 Mil spent on a [.10?] ROI so I can calculate the annual income for 20 MIL in properties.

Along with 30% quarterly dividends to investor

And with this formula, To utilizie those funds to acquire more properties over a three/five year period

There's the tough part.:SM061:

I'm dealing with an offshore investor in Costa Rica.

So a offshore shell corp/bank, is already accepted as a way of doing buisness.:SM056:

[Dan Auito]

I would imagine you would be incorporating a buy and hold strategy in the overall plan as well correct? Of course you can play the appreciating equities game that way and you would certainly be forcing some added dollar valuations to the bottom line more quickly.

You've done your homework on that outline Claude and IT SHOWS! I am going to have to ask you if you could put the headers for each catagory into a word doc outline for our members to be able to follow.

As for competition I think you're in your own league and don't fear that, I hope this thread grows as your plan developes further.

Let's just stick this thread so more folks will add to it! I think you aught to call your corp "Meat and Potatoes Inc" :SM063: :eating: :SM049: Your giving everyone plenty of food for thought!

[eldorado]

I would imagine you would be incorporating a buy and hold strategy in the overall plan as well correct? Of course you can play the appreciating equities game that way and you would certainly be forcing some added dollar valuations to the bottom line more quickly.

Your correct.
By paying cash alone...
I feel I can get decent discounts.
1.Buy at below market values by paying cash
2.Reduce debt service in five years by reselling the properties that yield the most profit
3.Keep remaining properties using the 4%- interest only note supplied by investor-at the end of five years
4. Put everything on auto-pilot so I can enjoy life.Hehe

Cash Talks --Bu^*@hit Walks...:biggrin:

The seller will not need to hold a second mortgage.:SM017:

Pre foreclosures can be bought
and...
Using the analogy- that most seconds that the seller holds might need to be sold or assigned at a discount.
I could win any bidding war be releasing the seller of the obligation of a second=Cash in pocket :thumbsup:

You've done your homework on that outline Claude and IT SHOWS! I am going to have to ask you if you could put the headers for each catagory into a word doc outline for our members to be able to follow .

I thought they were already..?????????????:SM006:
Or are you taliking about each particular page/topic?
I see that, when it's converted to pdf, it changes some of the outline..(underlines)
I still have the outline parameters in the last pages- They keep scrolling down as I work-I havn't erased them yet.

As for competition I think you're in your own league and don't fear that, I hope this thread grows as your plan developes further.

I agree, I do have a list of developers/management firms in the Chicago Area-but I feel it's simply unnecessary to show these competitors as I'm not marketing a product / Service..in a closed market base.

[Dan Auito]

Roger all! What I was saying about the outline was to just put the topic headers in a word doc as opposed to the PDF so people here could work up their own plans from a user friendly word doc as opposed to the the fixed PDF form.

No doubt they can do this on their own by looking at your example but your all over it right now and it may help you in your overall review of the exercise.. My way of cajoling you into working for free! :praise:

Thanks for everything provided to date, ya just gotta love good outlines! Dan :biggrin:

[eldorado]

Roger all! What I was saying about the outline was to just put the topic headers in a word doc as opposed to the PDF so people here could work up their own plans from a user friendly word doc as opposed to the the fixed PDF form.

Oh I get it...LOL
anywhoo, it's there already.
If you have MS Wordperfect's newer version...
There are templates there for just about everything..
Simply do like I did, and Morph the outline to accomidate your needs by using topic headers from other buisness plan outlines..(a little bit of Plaugerism)

[Aldo]

Dan, do you even have a clue about how hard it is to plagiarize a document when all one has is a list of topics? (lol)

Seriously, Eldorado, Roger, or whoever, this is super stuff. A biz plan in this business is very difficult, at best. More and more lenders are askng for biz plans and I don't see that changing. Your help will make things easier for a lot of people.

[kaimera]

hmmm, you are trying to raise 20million but finding it hard to write the business plan? I would suggest you go with a consultant or some sort to write something that wouuld be meaningful. Investing some few hundreds or thousand (even with a college kid) will definitely go a long way in helping you.

Just my two cents.

[eldorado]

Greetings Caimera, I appreciate your input

hmmm, you are trying to raise 20million but finding it hard to write the business plan? I would suggest you go with a consultant or some sort to write something that wouuld be meaningful. Investing some few hundreds or thousand (even with a college kid) will definitely go a long way in helping you.

But...
there is no standard template for a buisness plan of this type. If you read post 6, you'll see that most of what I need is already completed. It's just the financial/projections section that needs help.. No regular buisness plan writer can accomidate this particular project. It's probally going to have to be a large real-estate venture firm-that can complete the financial projections. Up front cash is - as always - the problem...

[kaimera]

not really, i know quite a few masters in real estate students here in ny at NYU that can crunch the numbers down for you for a minimal fee. send me a pm if interested.

[eldorado]

Hmmm...Interesting........:SM032:

[REIaddicted]

I love this example ! I think it also needs to go in the freebie section so others can use it.

You did an EXCELLENT job ! Thank you so much :praise:

Alesia

[CharleyB]

Claude;
If you don't mind sharing your template I certainly would like to see it. I'm working on a new proposal for our project here and it may apply.
All the Best,
CharleyB
www.rockyfordinternational.net

[eldorado]

Thank you - One and all..:smiley:

Kaimera-Check Your PM's for additional info you requested..We'll be in contact.:SM025:

Alesia- Thank You for you words of encourgement and praise :icon_buss

Charlley, I will email you the current status of the proposal,:SM135:
(It's on post 6 of this thread-I believe)
The template you speak of-Is found (somewhat hidden) in your Microsoft Word Program under "Buisness Plan"
Right there with labels and business card, etc...
I'll try to send the warz if you dont have it.
All you need to do is adapt it to your specific needs-as I did.. But feel free to copy my Template/Plan I'm sending you.
Just dont plagerize it too badly.
So I can use your funding source-when your successful..LOL

I just found a foreclosure.. 112 unit apartment building-
4.3 Mil- Could probally be bought for 3.8 Mil cash-REO-
40% occupancy to 60% in three months...New management..
HUD rent- restrictions lifted..
Lots of potential-armchair investment..
Could double it's price in three years........
Too bad this buisness plan isn't complete....
I could be writing to all of you from a Panamanian beach house...

[Tony Putman]

This all sounds very interesting and I hope to see the template in the future. Thanks all for the insight.

Right now I am a beginner and believe I should have a business plan to start out with. I think a one, three and five year outlook is necessary. Is there a template out there somewhere. I am looking at starting with the residential single family units and growing into some multiple family units. All help is greatly appreciated.

Thanks and Happy Easter, :SM009:

[Aldo]

I was cleaning out a file cabinet yesterday and ran across a sample business plan offered by a R.E. investor. Once upon a time I thought I needed a business plan, so I kept this thing.

I'd be happy to share it, but that's where the problem enters. This thing is 27 pages long and I only have a hard copy. I did a google search on the company and came up dry. Scanning and emailing it wouldn't work due to the size. And, no, I'm not going to post(say type) it here. But, I'd gladly fax it to anyone who wants a copy. Just send an email to propman40@gmail.com with your fax number and you'll have it within a few hours, max.

If anyone has another idea on how to share this, please advise.

[eldorado]

Perhaps, your fax machine has scanning capabilities, (Lexmark?)
You could scan it into a PDF or MS Word file and post it that way.

[Dan Auito]

Aldo Fax it to Claude, Maybe he will scan it and upload it here for us all. What do you say Claude? :SM106:

[eldorado]

Of course I will...

If my fax/printer doesnt run out of ink printing it out. LOL
Damn Lexmark sez u got half of the black ink you really have..
You run out with no warning.
Aldo, Read your e-mails and call me.


You are just one big plus in the assets column Claude, You add value everywhere you go! :SM144: Dan

[Tony Putman]

Claude,
If you don't have enough ink I can get the doc printed and scanned.

I see Steve Cook has a business plan outline for $39. Has anyone seen it? Is it worth the money?

Thanks all! :frog:

[Aldo]

I haven't had a chance to do email yet today though I know that I have 3 waiting for me. Mondays are not my favorite days.

I've never had cause to try scanning into Word or Adobe and have no clue whether I have that ability. My guess is that I do. I know this is important to a lot of people and I'll get this plan out tomorrow (Tue).

I must add that, being 27 pages, posting it here is not an option even IF it is possible. Brevity in posting is my by-line. I won't even read a long post, much less offer one.

The bottom line is that we're a team and teams get things done.

[eldorado]

dont worry aldo, it will go into a downloadable zip file instead of a readable post.Nobody will have to read/view it if they dont want to
P.S. I RAN OUT OF INK IN THE FAX/PRINTER TODAY. So we'll hookup in the future for as fax. and too top that off, my mouse died as well.AAAGGGHHH

Tony perhaps aldo should fax it to you and you can email it to me.
PM him
Damn equiptment.always fails when you really need it.

[Dan Auito]

Claude and Aldo, if we as a group ever get anything out of you two, it will be a cause to celebrate, you two are cracking me up over here! Way to go fellas, conquer adversity and win!

Hey Claude, you might need these guys! www.allink4less.com (Ink for less, much less!)

We'll be waiting. Heh Heh Heh

[eldorado]

if we as a group ever get anything out of you two, it will be a cause to celebrate

But I'm at least good for the "joke of the day' LOL

[Dan Auito]

Indeed you are my friend indeed you are! Good for the joke that is! I'm still laughing over here! :icon_knab

[kaimera]

Aldo,

I had sent you my fax number. I get my faxes as PDFs. Will definitely put it up here once I get it.

[Aldo]

There are about 300 Million people in the country, right? Well, what are the odds of this happening?

The first email requesting the business plan was from Eldorado. So, I called him first. After a few minutes of talking about the plan, we determined that he, in fact, is the author of that very plan. The entire plan is already posted as a PDF document attached to Post #6 under this thread.

JM, thanx for the offer to convert the now unnecessary fax to PDF.

[eldorado]

Well, I've found some templates for plans that all of you may be interested in. These are PDF formats. Enjoy

[Dan Auito]

Awesome Claude. The hurdle book absolutely rocks. Nice find! I'll be directing people this way! Hey do me a favor and up load the hurdle book to the free e books links block. Thanks again Claude you have provided superior value to the family today and it is sincerely appreciated! Dan and the crew! :SM128: :rockon:

[eldorado]

The Crew??? :icon_knab LOL
What are you laughing at you big ole bear? You're part of it! Ha :SM119:

[LeadingEdge]

Man do I feel like a loser!!!!! :SM031:

The crew here wont let me see the files at all. I tried opening them and it wont open. I am really curious as I was working on a deal with one commercial building with a development of 30 acres and I accidently said sorry I was working on something and they asked what so I told them it was the next phase with another project of a bigger development. They asked the numbers and said lets do both together in one file since same are.

Is there a way Eldorado can email me that so I have a second business plan to go from and someone tell me where to see the Hurdle at???????????
:praise: :praise:
I am soooooooo NEW!!!!!!

So much money to make and only one life to do it!!! Damn I am just soooo stressed now!!! :thumbup:

[eldorado]

Leading Edge..
Check your e-mails for info
And...Give me the financials when you complete them for your project

[LeadingEdge]

Thank You....

Now check your email. And just for curiousity,.

I bet you say that to all the ladies now dontya!!! :SM031: :SM031:
:SM015:

[eldorado]

I bet you say that to all the ladies now dontya!!!

Those are not the numbers of a female I'm interested in:SM092:

[Dan Auito]

Just a little bump to draw your attention to one of the most important things a new investor should consider doing!

[Aldo]

What, exactly, is ".......the most important things a new investor should consider doing!" ? If we are talking business plans here, I must respectfully disagree. I have never been asked, much less required, to provide a business plan. The fact that I have only been investing in RE for 29 years might explain that.

I truly think that creating a business plan for RE investing would be more difficult than getting a business plan from (pick your deity). The plan would have to allow for more 'course corrections' than any reader could understand.

Eldorado offered a business plan for RE investing a while back. Hopefully he can offer enough info to get you there.

[eldorado]

I tried opening them and it wont open. Is there a way Eldorado can email me that so I have a second business plan to go from and someone tell me where to see the Hurdle at

Mike, In case my memory isnt serving me correctly lately-
(That happens when your pre-occupied :SM120: )
I think I recall we might of resolved this issue. You need to download Adobe reader-Check on Google for a free download link-You should have anyway-It's become a very popular format. Almost all legal entities use PDF format.

I must respectfully disagree. I have never been asked, much less required, to provide a business plan. The fact that I have only been investing in RE for 29 years might explain that.

I'm willing to bet, Aldo That you never asked for funds for a development-or-to build an apartment complex-or a strip mall-or a sub-division.- At least not in the last 15 years.
All of these will require whats called a prospectus (A BUSINESS PLAN)

The plan would have to allow for more 'course corrections' than any reader could understand.

True- :smiley7: Except for the bank or investor group it's intended for!
A generalized one like I'm trying to do would-mabye- but a specific project (such as listed above) would not require ANY market changes!

Eldorado offered a business plan for RE investing a while back. Hopefully he can offer enough info to get you there.

Aldo, :SM031: This is the very string that the buisness plan is listed on.
Your reference is to the very string that I started to begin with-check the topic header!!!

Your respose is # 43 in this string.

Dans comment and post was intended to bring the string back up to the front of the forum in order to make it possible for more people to view it!.

Due to Dan's post, It now appears under "todays posts"...

This is the very same business plan string where you thought you found a plan that would offer me some assistance -as it turned out- IT IS my plan that you downloaded months ago and forgot where you got it from.

Aldo, This link apparently is for you.
http://www.starterupsteve.com/swf/posting.html

[Dan Auito]

Since we be talkin bidness in dees here parts, I taught I wood poot dis tread up! http://finance.slackerhtml.com/finance-i.html Boy it must be getting late!

[Jim Johnson]

This is a quite generic business plan, but it would help us all to do one.

Hi Dan,
Great job on this site, I wish I found it earlier
Was referred here by John Michael
I was on "the Creatrive Investor Site" but I think I just found a new home..
I have a delimina
I'm constructing a buisness plan for a foreign investor
20 mil,30% equity share,qtrly dividends,after 5yrs i get a 4% interest only mortgage

(NO! It's not Nigerian or Saudi or south africa front money scams)

I'm having a problem with the financial section. (20 mil)
How do you calculate a average ROI, NOI, per 1 Mil spent??
I just bought a 24 unit with 85-90K Income and 40K expenses-
I paid 350K- it appraised for 450K-.10 cap
I live in western Illinois and plan to invest in the Chicago area but am not locked into it.
Cap rates vary..how do you tell which apply for each area?
Is there a "norm" i can use for an example?
Has anyone ever done a buisness plan for real-estate investmenet-cause I sure can't find a template for one.
I plan on going after multi-unit residential with management and pay cash
Any help out there??

[eldorado]

Thanks Jim,
but as usual, these templates are geared toward marketing a product or service. Not for real-estate investments-but are helpful as a starting point.

Thanks a-bunch!

[Just Information]

Even though it may not be related directly to real estate investing on needs to learn how to associate it to the matter at hand "It's called thinking out of the box".

You said - but as usual, these templates are geared toward marketing a product or service. Not for real-estate investments-but are helpful as a starting point.

For the past 20 years plus in real estate investing I have been marketing a product and a service. Did I get off on the wrong boat as an investor?

My product = Real Estate
My service = Buy and sell real estate

[eldorado]

For the past 20 years plus in real estate investing I have been marketing a product and a service. Did I get off on the wrong boat as an investor?

My product = Real Estate
My service = Buy and sell real estate

Absolutly not John...
I'm just stating these business plan templates (most of them) deal with such items as inventory warehousing, product placement marketing, Inventory control,etc.
Things that don't directly relate to real-estate.

[Just Information]

My friend we are still not on the same page! Example:

Inventors warehousing - I have storage facilities that warehouse doors, windows, paint and so on.

Product placement marketing - Marketing of my properties, signs, advertisements, bulk business card distribution locations, bulk flyer locations, internet site locations of advertisements, billboards and so on.

Inventory control - 15 gallons of white exterior paint, 10 gallons of white interior paint, 15 paint brushes, 6 closet doors, and so on

I will get you out of that box sooner or later.:SM003:

[ray_higdon]

John, you impress me, sometimes I end up not doing a certain side business as I just don't have time and staying busy enough in deals I get. You sound like you built your infrastructure enough to bend to your needs. I am just starting to get there, hired a few people to market, do callbacks, call for sale by owners so I am only dealing with potential deals, not time wasters.

Anyway, kudos to you

[Just Information]

Thank you and to your success.

This has taken a lot of years of effort, time, and money to get to this point!