As the bloom has gone out of the economic outlook, real estate investors have become more hesitant to invest in properties with long profitability runways.
Pan American Properties CEO Rick Hoegler takes a different view. He believes that now is the right time to invest. The key, he says, is to understand how to turn a property into a profit source through smart investments in renovations.
Acquiring the Ballantyne Property
In 2015 Pan American Properties purchased a 40-unit building, the Ballantyne property in Southern California, for $100,000 per unit.
“We went in and completely renovated every one of the units, right down to the drywall,” Rick says. “We put in new cabinets, countertops, wood-like flooring and all new bathrooms.” The company redid the exterior as well, which was in bad condition when the acquisition closed. “We painted the outside, landscaped, repaved the parking area and upgraded the laundry room.”
Turning a Nice Profit
Seven years later, Pan American was able to sell the property at $260,000 per unit. “So not only did we do a great job with the sale price but during those seven years we refinanced twice and were able to get everyone’s investment dollars out with no cash invested in it. And we are still getting cash flow with distributions.”
It’s a success story all the way around, Rick says. “On the investment side, we able to get great results on the home side/sales side.” And the completely renovated property now looks like new, which helped to raise its selling price.
The Benefits of Investing in Real Estate
There are multiple reasons to get into real estate investing, Rick says. “It’s tangible, it’s a little more resilient than the stock market which ebbs and flows by the day. And it’s a good investment. After all, people need housing. And you get tax advantages. Here in Southern California, even if the value drops, the next high is higher than the previous high. The value just continues to march forward over time.”
You can ensure your success by working with a smaller company rather than a huge investment firm that has to constantly churn out properties. “Anyone seeking information will get immediate attention from the staff at Pan American. We call ourselves a boutique investment firm. We don’t have to do investments. But because we have the construction side and the management side, we don’t do an investment unless it’s the right investment for us and for our clients.”
Let Pan American Help You Make the Most of Your Real Estate Investment
Do you want to more than double your property investment? Seek out the experts at Pan American Properties, a property management firm that offers everything from renovations to investment advice. Call them today at (888) 754-9700 or email them at [email protected] to learn more.