Multifamily #1 An in depth review looking back

2020 Update:

This blog was written in ~July of 2019 shortly after I closed the property. I wrote a one year update of this purchase HERE that you can check out and might find it to be useful.

Below is still the original post 


First, never would I have thought I could pull this off when I started learning about real estate ~5 years ago. In fact I would have gone way faster in real estate if I knew then what I now know I’m capable of. I consider this purchase is a stepping stone for me, and what I believe to be a small, but important one. This has allowed me to realize I can accomplish a lot more than I originally thought. 

I’m not going to use this article as a brag sheet for the deal nor do I feel it most useful to outlay a spreadsheet worth of financials, instead I’m going to discuss the transactional pains and biggest learned lessons.  I’m happy with this deal but I’m not focused on celebrating, that’s a rookie mistake! My attention is on what I need to learn so I can become better so that’s what I’m going to write about. 

The deal

I was fairly unprepared when it came to multifamily, so essentially I stumbled through this deal due to both inexperience and somewhat lousy timing. I made a myriad of mistakes and put my ignorance on high display quite a few times, the process was humbling, embarrassing, and stressful. With all that in the past now though, I can happily say it’s closed it and now I am eager to pay my investors for their belief in me. 


24 Units

North Carolina

7.5% cap rate

5 partners

$250,000 raised


  • The property is 100% occupied at the time of purchase.
  • The buildings are brick and the roofs are all in good shape.
  • It’s in a recession resistant area that I know very well.

This was the first time I raised outside money for an investment so there was no reason to be cocky with other people’s money here. Instead I’m happy we found a property that cash flows day one and needs almost no work, it’s rock solid. Having full occupancy and little rehab needed does leave us with less potential upside, but it removes a lot of downside too. Being my first one the learning curve was high, so my main focus was to buy an asset that could kick returns to my investors reliably.

What I did right

  • We bid fast and put in an high quality letter of intent


I wasn’t actively looking at the time, but a fellow real estate investor comes to me with this deal that was very appealing. I was really wanting to take down a multifamily this year but at the time this deal came to me I was woefully unprepared for it. Regardless he showed me a draft letter of intent, we did a quick and dirty underwriting, and put in a bid within 24 hours. They accepted!

My first thought was that we made a grave error but to be fair anytime I have an offer accepted I assume it’s because I made a mistake. As we went through this process I found more and more that getting an offer in early and getting the property on contract was a SMART move. Even if the property didn’t close, pushing the goal post forward at every step was crucial and beneficial. If we had stammered or stuttered we would have learned far less. Also the seller admitted to me that part of the reason he accepted our offer is because of the high letter of intent we put in, and he said he checked out my website and was impressed. Maybe it wouldn’t have mattered, maybe it did matter, but the guy specifically mentioned it and to me that is not to be dismissed. 

I went on and had some really nice graphics made for the LOI and pitch deck. Cost me a few hundred bucks but WORTH IT. Below is a sample

We did not end up using VAX Investments! LOL
  • We stayed committed


We were getting pushed in all sorts of directions from a lot of different people, It can be tough to stand your ground against people who have more experience and try to be forceful with you. Potential investors wanted to dictate terms at times, the selling broker at times was heavy handed with us, and we put a lot of pressure on ourselves. All of these matter because they can lead to emotional decisions rather than strategic ones. I’m thankful that my main partner on this is more stable than I am (WHO ISN’T THOUGH?) and kept us on track. It’s easy to walk away from these properties at any moment and it’s much hard to stick in and grind through when you encounter hurdles, I’m glad we stuck with it.


  • I leveraged my website exactly the opposite way everyone told me to 


When I started my website it was for a few reasons:

  1. I thought I had something to say  the world could find value in hearing
  2. I knew I needed MY platform rather than always working off social media
  3. I intended to use it to generate credibility and social exposure for myself


What I didn’t care to do was monetize this site, and I’m happy to report (perhaps to my own detriment) that I have not done so yet. I have a TON of peers who are using their websites to make money selling coaching, courses, e-books, and trust that I have no problem with making money I do have personal limitations on how I would want to do it. Should I put ads on this site? Should I sell a course or coaching? Should I sell using affiliate links? I didn’t want to do any of those things because I didn’t want to make money in that way. I wanted to make money through real estate primarily and did not want this to become primarily a marketing effort.

So, under 2 years after creating I can happily say that I haven’t done any of the things I didn’t want to do and yet I have made higher returns than I ever imagined. How? Because my credibility, authenticity, and transparency were valuable enough to entice people to reach out to me. Most of the people I partnered with for this deal were people I met through my website simply because we had a common interest in networking. This was the exact vision I had when I started this site despite the difficulty of using a strategy that none of my peers were using or suggesting, and to be completely transparent most of my peers still tell me I’m missing tons opportunity (someone even told me my approach was incorrect).  

Thankfully like so many times in my life I ignored other people and listened to myself 😉 😉 Ultimately there is no correct approach but I’m truly happy that my vision

The lesson here is thus: if you want to grow your brand and your credibility over the long run then start your own website immediately. Start now so you’ll have it before you need it, waiting is for suckers.


  • I leaned on my network heavily


First it’s important to note that my network was barely enough to complete this close and I’m a popular-ish guy. So I do have a lot of room to improve in this area, but it also does show that the work you put in NOW in networking will come into play later so take it seriously. Compared to buying residential properties it takes a lot more people to close these deals and I needed to deal with these people much more directly than when doing residential. Can you find the deal, do the underwriting, the negotiating, get inspections, find the vendors (insurance, property management, contractors, title), find a lender, talk to legal, and whatever else is required all by yourself? I certainly could not, not by a long shot, so I’m thankful I have had time in this business to develop relationships and I leaned on them hard. Calling everyone I could to help with the deal, sometimes just for advice and sometimes for knowledge. I asked for help from a lot of people who weren’t even included in the deal and I was relying on my main partners daily as well.

I knew lesson before but I had never felt it like I did through this transaction: the more you invest in people today the more people you’ll have to come to your aid when you need. Invest in other humans relentlessly and do it starting immediately because no matter how good a deal is, you will need the help of other people to take it down.

What I did wrong

This list could be a mile long if I was thorough, here are the big ones though:

  • Process errors

When is the correct time to collect money from investors? What if it doesn’t close? Should we renegotiate the deal before we get the bank approval? At what point should we start working on legal? What loose ends are going to pop that we don’t know about?

We ran into a ton of these vague process errors that were limited in scope but vastly annoying. It’s the same as going through a residential transaction for the first time and you have no idea what you should be doing or what to expect next. The big difference is in residential the realtor and the loan broker will do most of this for you but on this deal we had to do it all ourselves and we had no idea what we were supposed to be doing. This is a mistake of having all rookies on the team and it’s true I kinda like that from a philosophical standpoint (love me some underdog!) it did have some negative impacts and was cause for additional stress. For most of this we will improve our capability going into the next deal but I anticipate we won’t be fully cured of this problem until we’ve done a few of these transactions.


  • I underestimated how much capital I would be able to raise


I’m pretty sure everyone does this, I expected it and yet I was still surprised about how big the gap was between what I expected to raise and what I actually raised.

I figured I could get ~$600,000 pretty easily and I only needed $150,000 for my side. Should be easy right? In the end I didn’t even come close! Only raising $150,000 with my partner raising the other $100,000 and even that was like pulling teeth. What happened?

  1. The deal is good, but not sexy. I found many people were willing to give me their capital but they wanted higher returns than this asset provided. Certainly not something I would be mad at anyone about, but for me there is more to look at than just “does it kick off 12%?”. I knew doing my first deal was going to be much more about learning than hitting the jackpot, in fact a low downside asset which is fully occupied and in a recession resistant area is exactly what I like about this deal! It’s a 7.5% cap deal  but it’s damn near guaranteed cash flow from day one. Being my first one I wanted something that had a lot of risk mitigation built in rather than a ton of upside because the most important thing to me is making sure I could pay my investors profit, even if it wasn’t always 12%.
  1. Some people just don’t believe in me. That was difficult to grapple with but to be completely fair, why the fuck should they? I haven’t done this before! I’m not sure I would believe in a first time so I’m not offended when other people don’t. I only bring this up so YOU the reader so you can expect that it very well may happen to you as well. Luckily, I think many of the potential investors I approached on this deal will be much more inclined to buy into the next one with me once I get some time in experience.  
  • I made an embarrassing error in negotiations

This was a process error that we didn’t think through at first. Coming towards the end of close, after we had all the financials in, it was becoming apparent we needed to pay less than agreed, the numbers just weren’t adding up. This is normal, so I didn’t think anything of it, we knew we were set to be complete with finance in around a week so we went to the selling broker to pitch our price change. They countered and responded with “by accepting this counteroffer we consider the due diligence period over and set to close”. Well our due diligence wasn’t over as we still needed to finish the credit side. Let me tell you the seller was not pleased about this. Looking back it’s obvious to see that now, why would the seller have bothered to renegotiate if we can’t close anyway. This wasn’t the end of the world, it was a bit embarrassing to have that phone call with the broker and hash this out. 

Luckily, I have a long relationship with embarrassing myself so I was not in new territory.

  • I did not solicit this deal and that hurt me badly.

First, a bit of the reason I didn’t talk about it much was my delicate ego. My long term plan for this is to buy more of these and raise money from more investors. So I want to be known as someone who ‘closes’ and what I didn’t want was to spout off all over social media about a potential deal that fell through. I know that this happens every single day so it wasn’t just ego, rather I just didn’t want to be seen as someone was going back and forth and show the persona of indecision or ineptitude. This is the burden and blessing of social media: we can control the narrative. Also, this was a partnership and not a syndication so we were not legally allowed to solicit for investors as we weren’t legally setup to sell a security. I was able to get funds from people I knew well, but being able to sell the deal publicly would have helped tremendously! Looking back it was a bit of a mistake the way I went about it but maybe if I had been public about it and then it fell apart that would have been a bigger hindrance to my credibility? Who knows, I wrote this so YOU can analyze my pitfalls and hopefully do it better when it’s your turn.

This email from the broker

Key lessons

  • Economies of Scale

By far the biggest thing I learned. 

Economies of scale was a limitation I felt from the very start. it was painful in the interest rate, property managment, and 

I said from the very start that the deal was too small and after going through the whole thing I believe that even more strongly. Economies of scale is the core benefit of multifamily, focus on it! 
  • Feeling confident about your ability to close this type of deal is not a requirement

There wasn’t a single day over this 3 months that I felt confident in our ability or qualifications to close, and yet we did. We weren’t ‘ready’ when we started and there were many days I figured it was going to die so I felt unmotivated to keep trying. Many days it was my partners excitement who kept me motivated, many days I kept him motivated. I don’t think anyone does these deals and feels like they are a sure thing from the outset, you have to try even when it doesn’t feel right. Just keep pushing that goal post forward! 


  • You need to know what you’re good at, and you need people around who are good at everything else

I could not have done this deal myself, not by a long shot. My partner was an absolute necessity, and yet if you ask him he will say the same about me. Let’s talk strengths and weaknesses: I’m good at sales, I’m good at managing human capital, I’m a good communicator, I’m good at working on big picture problems, I excel with abstract ideas. I’m bad at grinding details. I’m bad at staying focused on one specific thing for a long time, my moods and motivation fluctuation wildly, I’m often too optimistic in my predictions. My partner doesn’t like to sell, GREAT at putting understanding and putting together detailed reports, he doesn’t get easily distracted or have huge emotional ups and downs in his personality.

These things made us work together very well, I’m grateful for him and I’ve had lots of potential partners over the years who didn’t work out well at all. It’s imperative you don’t choose someone who just wants to do real estate with you, you need to choose your partner like a marriage. Can you stand this person for 5+ years under stressful situations? If you pick the wrong person you’ll find it hard to undo. 

What to focus on next time

I’m trying to create a 3 pronged approach to locking in my next deal. I don’t know if it’s right but I bet it’ll work: 

  • Marketing: Solicit like a housewife selling her first pyramid scheme

I was quiet this time because I wanted to learn the ropes and how to put one of these together, I also couldn’t solicit due to being a partnership but next time we will do a deal large enough to warrant the cost and scale of syndication and I’m going to turn my entire operation into a funnel for bringing in deals and investors. I’m going to be much more deliberate about my social media outreach, email marketing, and staying in touch with potential investors. 


  • Networking: Increase exposure and shake a lot of hands

The current plan is to go to the big national multifamily conferences, get on some more real estate podcasts, travel to areas I want to invest and shake hands with local investors

You know what helps facilitate people working with you? Them knowing you’re deeply committed. When I talk to out of state investors they ask me if they should fly down to the area they are buying in at least once, and the answer is YES! Why, because it shows you’re willing to spend $600 and a weekend to make this happen. If you’re not willing to spend the money or the time, how committed do you think the vendors in that area are going to consider your intentions? So my plan is to show my face at ~3-4 multifamily real estate conferences per year from now on so people know I’m a committed staple in the community. This is a bit of an abstract strategy I know, but I figure I’ll meet enough people often enough that they see I’m serious about this and they will then take me seriously, plus my charm in person is undeniable and I would be silly not to leverage my greatest strength.


  • Education: Podcasts, webinars

I have a LOT more to learn! I need to learn about putting together investment funds, the legalities of syndication, how to structure and process details of these transactions, and more. The list of things I need to know is LONG, so I know I’ll have no problem filling my free time with learning. 

These three angles should get me in touch with potential investors, people who can help me find deals, lenders, partners, etc. 

I open my inbox to this <3


I did this article a bit differently than usual, I didn’t post the numbers or strategy as much as other posts. I figured the way I could best provide value was to describe what what hardest for me and the most interesting parts of the story. So that’s what I did. The numbers and strategy weren’t as important here as getting through the transaction. THAT SAID, I reserved this place to update with questions and answers people have so that I can provide more specific value as people see this post. So if you have a question, leave it in the comments or email me, I’ll answer it and post it here to further help the next reader.

  • Where did you find capital investors?

All my investors came from my website. Can you believe that? I barely can but it’s important to mention because it means the people who read this blog are people I meet and do business with. So if you’re reading this and we haven’t spoken: We are missing potential opportunity. Second, it reinforces my favorite advice of the year: everyone should create their own website and brand. 

  • How did you find the deal

One of the above mentioned investors brought it to me. We did some business together on 3 single family homes and we both knew our goal was to do a larger one in the future. Since we had a relationship, we knew we would work well together and we were able to move forward on it. 

  • How did you create the deal structure?

This was  little tricky, it wasn’t big enough to warrant the cost of syndication, so we did a (nearly) equal partnership. There was some offset in percentages for lending and resource purposes, but it’s essentially 5 people at 20%, owners ship (cash flow and equity)

  • Alex, how can I invest with you next time?

Great question! Make sure to sign up for email subscriptions for the website, reach out to me at and tell me you’re interested. We are going to be sending out potential deals and communicating with investors to generate interest regularly going forward. Getting involved is easy! 

Picture of Alex Felice

Alex Felice

I am an investor and camera creator I share my story to make yours easier. I created financial freedom through real estate, then found my love of art through cameras, and I have an ongoing love of reading and philosophy. I am hyper-extrovert so there are lots of ways on this site for us to interact. I have workshops you can participate in, I have a podcast that I invite strangers on, and I have a private community you can be part of. Everything I learn about life goes here so I can hopefully make yours easier