220: Avoiding the Real Estate Debt Trap with James Kandasamy

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By Accelerated Real Estate Investor Podcast and Josh Cantwell. Discovered by Player FM and our community — copyright is owned by the publisher, not Player FM, and audio is streamed directly from their servers. Hit the Subscribe button to track updates in Player FM, or paste the feed URL into other podcast apps.

Everyone wants to invest in real estate, but few are willing to put in the work to make it happen.

When it comes to multifamily investing, starting out can certainly be a grind, but if you want to find a good deal, you have to be willing to do what others won’t.

This is something that today’s podcast guest knows all too well. When James Kandasamy first started his multifamily journey, he went to all the brokers, searching for opportunities, but nobody took him seriously.

Instead of giving up, he decided to take things into his own hands. He used a combination of direct mail, cold calling, and his networking skills to find off-market deals and get his foot in the door. To this day, he believes the people who win, are the ones who are willing to do things differently — and that’s exactly how he rose to the top!

James is now the Principal Director of Acquisition and Investor Relations at Achieve Investment Group - a vertically-integrated real estate company, actively engaged in multifamily acquisition, asset management, property, and construction management.

He has identified, underwritten and overseen the acquisition process of over $180M of quality multifamily investments and routinely leads passive investors to an average IRR of more than 20%.

Pretty impressive for a guy who was turned down by all those brokers! Let that be encouragement for any aspiring real estate investors.

In our conversation, we hit on a number of topics related to multifamily investing. You’ll learn about the risks of using bridge loans, Debt Service Coverage Ratio, stress testing, market projections, the deal structure James uses that puts investors first, and how to avoid getting stuck in the debt trap!

Key Takeaways with James Kandasamy

  • Off-market deals VS. working with brokers.
  • The threat of using a bridge loan to buy a property — especially with rising interest rates.
  • Multifamily real estate didn’t crash during covid, but it is under stress — invest wisely!
  • Is your deal profitable or losing money? Make sure you understand Debt Service Coverage Ratio (DSCR)
  • Multifamily is a great investment vehicle, but if you’re not careful you could get stuck in The Debt Trap!
  • The pinch between rising interest rates and cap rate.
  • The importance of stress testing your deal.
  • The power of being a vertically integrated real estate company.
  • Different ways to distribute returns to investors — and why James prefers the waterfall structure.
  • Real estate projections for 2021/2022.
  • Why multifamily will always be a winning asset class — at least for those who understand how to properly buy and manage a property.
  • Why expanding your network and increasing your circle of influence is the best way to learn.

Want the Full Show Notes?

To get access to the full show notes, including audio, transcripts, and links to all the resources mentioned, visit https://acceleratedinvestorpodcast.com/220

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