In the spring of 2017, EAC partnered with HomeWorks Investments, Inc. to create rental portfolio in South Bend, Indiana and surrounding area. Our partners, Joe Colvin and Rob Manuszak are seasoned veteran real estate investors in South Bend for over 15 years having been involved in over 1,000 transactions. At the start of 2018, EAC – South Bend holds over 50 cash flowing properties.
About South Bend: Cost of Living Livability Community College Town Things to do
Experience, honesty and mutual goal of owning safe, clean, income producing rental properties is what brought EAC, Joe Colvin and Rob Manuszak (HWI) together in 2016 to create EAC – South Bend, LLC (EAC-SB). We purchased our first home in March of 2017.
EAC – South Bend, LLC (EAC-SB) is an Indiana Limited Liability Company wholly owned by EAC, GP, Inc. (EAC), with sole partner Dr. Kevin Yoo. Joint Venture Agreement for ownership and cash flow:
- 50% EAC
- 25% Joe Colvin
- 25% Rob Manuszak
Background – Home Works Investments, Inc.
Home Works Investments, Inc. (HWI) began in 2003 as a real estate purchasing / sales / financing company in the South Bend, Indiana and surrounding area. Our first deal was a traditional “flip that house” and after a number of early successes, we expanded our capital base in 2005 and began buying, selling and financing projects in the single-family home space.
- The 2008-2009 credit crisis and U.S. real estate collapse resulted in a high demand for investment rental properties by savvy investors. HWI created full end-to-end solution for investors by providing cash flowing properties and an in-house property management company to meet our investors’ needs.
- Since 2009, HWI has bought and sold over 1,200 properties. This has given us extensive buying, rehabbing, maintenance, property management, and selling experience. We have also directly experienced the changes in the residential real estate market over the years.
- CREDIBILE – We honor our commitments. We do what we say we will do.
- RESPONSIBLE – We are clear and direct in our communication.
- HONEST – We bring honesty and integrity to everything we do.
- PROACTIVE – We are action oriented. We make things happen.
- CONSIDERATE – We treat people fairly and with respect.
Joe Colvin: 15+ years of experience flipping 1,200+ investment properties in the South Bend/Mishawaka area. Built a property management company from the ground up with 900+ single family houses under management.
Rob Manuszak: 10+ years in Real Estate with a concentration in Property Management and construction management for single family home project
managements. Active broker in South Bend/Mishawaka area.
Property Management is a critical component to any Buy & Hold company. This is why we have hired Home Works Management Corporation (HMC), which was founded in 2003 with a great track record to provide full-service Property Management:
- Online access providing real time information
- Direct deposit
- Full maintenance services from rehabs to day to day resident concerns
- Numerous advertising outlets including name recognition throughout Michiana
- Extensive application screening
- Dedicated collections department
- Full time staff: resident relations, licensed realtors on staff
- Process property tax payments and tax assessment appeals
2017 Performance Metrics:
- # Units: 907
- Vacancy Rate: 4.6%
- Collections: 100.4% (includes late fees)
- Renewal Rate: 39% (same tenant for 2.5+ years)
- Properties are found via: auction, private, property management, word of mouth
- Acquisitions funded using EAC-SB or our private investors
- Price range from $20k-$100k with ARVs $30k-$175k+, with goal of <70% ARV all-in costs
- All major components are assessed and replaced at close to cost
- Rehabs typically take 3-6 weeks, but some more extensive rehabs can take 3-6 months
- Some units have tenants and if they meet our criteria, they remain in home
- HMC will market homes through multiple channels achieving < 5% vacancy rate
- Season property with tenant as required by lender (varies 3-12 month)
- Refinance – refinance with long-term lender (60-70% LTV) with DSCR >1.25, typically 1.5+
Repeat – goal 200+ homes
EAC-SB Current Holdings
Google Map Link – http://bit.ly/2HMHl66
- Our core business model utilizes traditional 12-month leases, but EAC-SB employs other strategies to increase the returns on select properties.
- AirBnB / Short-term rentals:
- The city of South Bend is receptive to short-term rentals due to:
- Notre Dame events (sports, arts, etc..)
- Steady flow of grad students, professors, researchers on assignment for a few weeks to a few months.
- Current AirBnB: 1009 Kinyon in Keller Park (active listing)
- Average Nightly Rate $89/night
- Football weekends ~$900 x 6 home games
- Short-term rentals for insurance companies (i.e. fire damage homes)
- 6 month average rental income to date is $2,500/month
- Traditional rent $625/month
- Plan to expand to select few properties