MB 080: Nighthawk Equity: You Find the Deal, We Do The Rest – With Mark Kenney

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Your chances of doing even a 60-unit multifamily deal on your own—with no track record—are very slim. Even with the capital and the knowledge, if you are lacking in the reputation department, brokers will have no confidence in your ability to close. Enter Nighthawk Equity, my partnership with Mark Kenney. You bring the deals, and Nighthawk does the rest.

Mark has been investing in real estate since he graduated from Michigan State 23 years ago, partnering with his twin brother to buy and rehab a $36K duplex. He continued to pursue small deals and flips during his career as a CPA and consultant for KPMD. Eventually, he started his own IT company. The business thrived, but 80-hour weeks and extensive travel translated to suffering in his personal life. With his marriage in trouble, Mark made the decision to take a huge pay cut, hand off the big projects to someone else, and pursue real estate investing full-time.

With the support of his family, Mark spent nearly a year securing his first big multifamily deal, a 64-unit building in Dallas. Adhering to the ‘law of the first deal,’ his second and third deals followed right away. In four years, Mark has purchased 2,000 units and raised tens of millions in capital. Today, Mark shares the process of working with Nighthawk Equity to secure a deal, explaining how we came to join forces, the response to Nighthawk, and the right time to get Nighthawk involved in your deal. Listen in to understand the mission of Nighthawk Equity, and how the firm also supports passive investors looking for a solid ROI.

Key Takeaways

[2:36] How Mark got started with real estate

  • Didn’t have much money growing up
  • Knew real estate was tangible
  • Bought $36K duplex right out of college (with brother)
  • Used money saved over years for down payment
  • Full rehab
  • Continued to buy, rehab small multifamily properties

[5:13] Mark’s decision to become a full-time real estate investor

  • Worked as CPA, then consultant for KPMD
  • Founded successful IT company
  • Working 80 hours/week, projects all over world
  • Personal life and health falling apart
  • Decided to quit four years ago
  • Took huge pay cut, turned projects over

[7:16] Mark’s first syndicated multifamily deal (64 units)

  • Took nearly a year to secure deal (build relationships, team)
  • Raised $1M with one general partner, 14 other investors

[9:44] The deals that followed in rapid succession after the first

  • 208-unit within two months
  • 255-unit, 454-unit and 344-unit within short period after that
  • Found partner with track record, relationships in Atlanta
  • 800 units in Atlanta this year alone
  • Raising money easier as well ($2.8M, $6.2M, $4M)

[11:30] The importance of surrounding yourself with the right people

  • Mark’s dad talked him out of buying early on
  • Risk involved in anything you do
  • Listen to wrong people, never do deal

[12:46] Michael and Mark’s partnership

  • Joined forces to scale transactional side of business
  • Chances of doing deal on your own very slim
  • Leverage their track record, reputation as partners

[14:51] The response to Nighthawk Equity

  • Looking for deals as syndicators
  • ‘Floodgates opened’ after Episode 74
  • Deals in OKC, Dallas, Memphis and Houston
  • Nighthawk diminishes fear of raising capital

[17:47] The process of working with Mark and Michael

  • Do initial underwriting, receive feedback
  • Coach qualifies (realities of assumptions)
  • Patrick reviews deal
  • Strong likelihood deal will work before gets to Mark

[18:52] The right time to get Nighthawk involved

  • After deal analyzed, researched properly
  • After pre-negotiation (verbal agreement, numbers discussed)
  • Before LOI
  • Before contract signed

[20:44] The future of Nighthawk

  • Help new investors alter mindset (i.e.: 69- to 321-unit in five months)
  • Continue to pursue joint ventures with students
  • Carry on mission to help others gain financial freedom

[24:44] Mark’s pitch to passive investors re: multifamily

  • Meets basic need, never going away
  • Incredible ROI
  • Performed well during recession (.4% default rate)
  • Tax benefits (pay little/nothing due to depreciation)

Connect with Mark Kenney

Think Multifamily

Email mark@thinkmultifamily.com

Resources

Podcast Episode 74

Partner with Michael

Invest with Michael

Free eBook: The Secret to Raising Money to Buy Your First Apartment Building

Review the Podcast on iTunes

85 episodes available. A new episode about every 11 days averaging 37 mins duration .