Our investing partnerships in Denver give our clients the opportunity to invest in different types of real estate without the management hassle or any obligation on the mortgages. Generally our investing partnerships have a goal of either immediate income or capital appreciation.
Examples of our properties that have the goal of appreciation are four self-storage facilities. We have three properties in Mobile Alabama. These three properties comprise a total 230,000 ft.² of buildings which is about 5.2 acres of buildings. They located on about 20 acres of land in three different locations. They have a total of 1,420 individual units and 50,000 ft.² of flex warehouse space which is rented to contractors and other companies needing an office and warehouse. The purchase price was $11,550,000. We raised $4,300,000 through three different partnerships, with an average investment of $35,000. Many of these investors utilized their IRAs. A self-directed IRA allows you to purchase an interest in a partnership. We also purchased a self-storage facility in Albuquerque. The Albuquerque property is 41,000 thousand square feet and 300 units. It was purchased for $1,700,000 with a $700,000 down payment. This partnership was structured as a tenants-in-common partnership to allow clients to trade their appreciated rental properties in to a larger venture.
ABW REO’s LLC is a partnership with the goal of immediate income. Five years ago, Jim Flint jumpstarted ABW REOs’s LLC. This partnership has purchased over 100 properties. The partnership joint ventured the remodeling of single-family homes with contractors. The partnership has received 14% interest on the money that was invested in these homes. The total number of properties purchased is valued over $10 million. Those properties were resold for $15,600,000.00.
To be diversified with different income sources, we also own three assisted living properties which are leased to an operator on a triple net lease basis. This means that the partnership is not responsible for any of the hiring, advertising, taxes or insurance. Fixed rent is paid to the partnership each month. This partnership has generated a 10% return every year since inception. Currently we have $3.8 million of invested capital from 79 clients. Many of those clients also invested through their self-directed IRA. We also do short term commercial loans at 14%.
Our Napa auto parts store is another example of an immediate income property. We purchased a Napa auto parts store in 2014 in Minneapolis St. Paul Minnesota. The property was purchased for $1,600,000. This was also set up as a TIC (tenants-in-common) partnership. This allowed clients to trade their appreciated single-family homes and other types of real estate and execute a 1031 tax deferred exchange. Therefore they were able to get a return on all of the equity and not have to pay capital gain tax. This partnership also has returned 10% since inception. Our next partnership will be to build three assisted living facilities near Golden.
List of Partnerships
Below is a list of partnerships. The properties listed in the top section are the partnerships I have formed and later sold the real estate. You will note that I raised about $3,000,000 and bought $12,000,000 of property, which was later sold for $20,000,000. The bottom section lists the current properties. In more recent years, I have raised over $11,000,000 and purchased over $22,000,000 in properties.
The most active partnership is ABW REO’s LLC. This Partnership’s primary goal is to provide immediate income. The Partnership is considered to be a mutual fund of real estate. It is diversified into three different sources of income.
In my classes I discuss the three benefits of real estate: income, tax benefits, and growth of equity. Each property will accentuate one of the benefits. These partners wanted immediate income. These partners wanted contractors to purchase homes, repair, and resell them. We have completed 92 homes at this point. We also have invested in some short-term commercial loans. All these loans are at 14% interest. For further diversification, we own three homes that have been converted to assisted living facilities. They are leased on a triple net lease basis to an operator. On a triple net lease basis we don’t pay for any operating expenses. The operator pays for taxes, insurance, all upkeep, all marketing, staff and other expenses. We just own the real estate. One facility has ten bedrooms, the other as 12, the third and most recent one has 16 bedrooms.
Maplewood NAPA, LLC also has the primary goal to provide immediate income. The difference between the two Partnerships is that this Partnership owns a NAPA Auto parts store in Minnesota. Because we own the property, we were able to have clients trade their appreciated long-term rental properties through a 1031 tax deferred exchange into ownership of this building. The rent from this building tripled the income that they were receiving. Some investors also invested cash. We focus on the needs of the investors with these partnerships.
The self-storage facilities are primarily a growth oriented partnership.
Our next partnership will be focused on long-term growth with three assisted living properties.
LEARN MORE ABOUT OUR LATEST PARTNERSHIP WITH DOLLAR GENERAL:
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