MIM 55: Empower Your Deals with Proper Due Diligence with Robert Benenate

In real estate, knowledge is power and poor due diligence can lead to unexpected business-breaking costs. Today we speak with expert property manager Robert Benenati about how you can empower your deals by performing flawless due diligence. After chatting about his real estate background, we dive into the topic, with Robert sharing details about his pre-offer due diligence process. He touches on red flags to look out for, the importance of analyzing rent rolls, and what to look for in the property’s expenses. He then highlights the need to understand your market before unpacking how he inspects the physical property. While discussing how big-ticket items can lead to enormous expense, Robert talks about why he brings in experts when performing due diligence. We then hear Robert’s take on due diligence once a property is under contract. He touches on leases, financial audits, and ensuring that management companies don’t contract their work out to other parties. Later, Robert discusses some of his best practices, like having a checklist, utilizing staff, and checking public tax records. We wrap up our conversation by asking Robert our fast five questions. Proper due diligence helps you discover as much as possible about a property. Tune in for more on what you can do to perform perfect due diligence.

Key Points From This Episode:

Robert shares details about his background and real estate journey.
Exploring Robert’s pre-deal due diligence process.
Which red flags to look out for on property rent rolls.
The importance of knowing your market.
How Robert inspects a property before making a deal.
From mold to water leaks, the factors that most increase your expenses.
Robert discusses his due diligence once a property is under contract.
Hear about the experts that Roberts brings in to assess a property
Dealing with sophisticated sellers who try to hide property deficiencies.
Tips on keeping track of due diligence ‘big-ticket items.’
Common mistakes that Robert has seen investors make.
How Robert performs financial due diligence.
Insights into which documents and contracts to focus on to judge future expenses.
The 'fast-five' with Robert; starting over, mistakes, technology, and more!

Tweetables:

“You definitely want to know your market and surroundings before even looking at any property.” — Robert Benenate [0:08:16]

“When doing due diligence, you start your focus on all of the big-ticket items. If you miss one HVAC, that could be a $4000 mishap.” — Robert Benenate [0:13:49]

“I’ve been in the field for a long time. I will tell anyone to hire someone who is experienced and licensed to help you inspect properties.” — Robert Benenate [0:24:35]

“If I had to start from the beginning again, I would find other people in this field and learn everything that I can. Get out there, get into the community, and learn it first-hand.” — Robert Benenate [0:37:18]

Links Mentioned in Today’s Episode:

Robert Benenate on Facebook
Robert Benenate Email
Strategic Property Consulting
Multifamily Asset Management and Value Adds on Facebook
Rich Dad Poor Dad
Audible
Kronos Investment Partners
Kronos Investment Partners on Facebook
John Stoeber
Fritz Ritter
How To Analyze Big Apartment Buildings And Make Them Feel Small