Learn from mistakes - tips and suggestions # 4

Good morning to all dear friends language. Following correspondence with Lior Now I will tell here now about my personal experience at the beginning of my path in real estate in the US, with 2 investment funds from Israel.
I'll start with it, that the story is not easy,
Make handkerchiefs.
(-) Just a little bit.
The truth is that the story is not easy and involves significant financial losses, but I think the conclusions will be significant.
I will not name the companies because it is less relevant, and because against the owners of one of the companies and an Israeli bank is a huge lawsuit.
As I said, I'm at the beginning of my journey in the US, I bought one private property in the Detroit Michigan area, and then I say to myself, now let's try to buy in a group, I went checked out some companies, and came across a company that sat in the stock exchange area, fancy offices, and all the show around is impressive.
Multi Property Buyers 400 + Homes in Houston.
We were about 50 people in the group. Started fine. We received 8% annual interest on quarterly payments. Second quarter three then comes an email from the owner, the company collapsed, and you'll have good luck.
In retrospect, several things were explained:
1. The owners stole the money from renovations from certain projects and used them for their own needs,
2. The beautifully printed paper, which was supposed to be an authentic deed of ownership, was apparently printed in south Tel Aviv and was worth nothing. The property was owned by the owners and was not registered in the Land Registry in the name of the company they established in favor of the acquisition
3. The problems piled up, there was a complicated mortgage, and more and more.
To my great joy, all the partners gathered quickly. We immediately set up a committee, took an Israeli lawyer who works in the United States, went to an American court to stop all the proceedings and fought. We were able to transfer the property in our name. We managed to save the property within days from a water debt to the municipality, $ 90000 collected from us within days,
We managed to get a serious management company into the property, which installed it, renovated it, and started to rent out to a better population.
2015 We did asset refinancing. We have returned the entire investment, and today we are in the process of selling, which should yield a nice profit for all of us

A second well-known fund, large and full of projects in Israel and abroad.
I will not talk extensively, but I was invested in two projects.
One was an excellent asset and a very high occupancy rate 96% At the beginning, 8% annual interest rate by quarterly, and performance is going down. Quarterly.
Somehow a year late from the business plan they managed to sell the property, we returned the investment, and in my understanding we eventually earned about 2-3% annual.

A second property I have invested in, a commercial center that was rented out at 50, put in a giant American company that leases after a year, 7, we have not seen a shekel, and I do not see the light at the end of the tunnel.

Conclusions
1) must understand that if you buy in a group it has meaning. You are not the owner but you are part of the owner. You have no control over the activity, performance, and property listed on a company that you are part of.

2) If you buy in a group and have a prospectus, you will read in depth you will understand everything. If you do not understand, consult a professional who will explain to you what your risks and exposure are

3) Invest in this group can be great for those who want to be really passive and make no decision. It is not suitable for those who want to study the field, delve deeper, and especially grow and take responsibility for their performance.

4) It is very important who do business with. Who are the people behind the group fund, what their background is, how many years they are in the field, recommending clients, completed projects, what their commitment is, whether they invest in the project themselves or only manage it for you and live only from the management fees they charge.

5) In the group when all is well, it turns around. The problems will be much more complex than a private property on your behalf, when the problems begin.

6) If you are in a group that runs an Israeli company, I think you should have a list of all the partners, investors like you before purchasing. You should talk to each other and decide what happens when there is a problem. Give the power of attorney to the delegates to act on your behalf because time is critical.

7) The Internet will soon be flooded with another Israeli company that has collapsed these days, leaving groups of angry investors behind, mostly unable to manage and manage.

8) You understand and clearly that every form of investment has its advantages and disadvantages, every investment should come with as much knowledge and understanding as possible.

On a personal note: I really enjoy this active group. There is a lot of knowledge here that is shared and shared by all. The managers here are professional, the ideas are creative and the knowledge of the masses can help us all. And this was straightened out.

Since tonight I am stepping down in advance from the respectable stage given to me I will be up tonight a short post about who we are, “Sand Real Estate Investment Bar”, about what we do and how we work with our investors in the US market.

Thanks again to Lior and Ido

Link to the original post in the United States Real Estate Forum on Facebook - Works on a desktop computer (To view the post must be members approved for the forum):
http://bit.ly/2GF7YMX

The original responses to the post can be read at the bottom of the current post page on the site or in the link to a post on Facebook and of course you are invited to join the discussion