Search

What falls into operating expenses?

Operating expenses are expense line items/ liabilities that are paid to keep a business running smoothly.


For apartment syndications, these expenses are the costs of running and maintaining the property. These typically include payroll, utilities- electricity, gas, water/sewer, trash removal, maintenance, repairs, contract services, advertising/marketing, administrative, management fees, taxes, insurance, and reserves.


When underwriting a property, the expenses are outlined in what is known as a T-12 or trailing 12, which is a report expressing each expense as a separate line item for the last 12 months.


This separation can help us identify weak and/or areas of improvement for a complex and how best to handle these line items.


In order to seek the best returns for our investors, it is imperative to have a good, firm grasp on the operating expenses to ensure we are not taking a deal down that really isn't a "good deal."


As always, any and all questions are welcome!

17 views0 comments

Recent Posts

See All

Don’t believe me? Well, think about this for a second… Unless you came from an entrepreneurial family, we’ve all been taught the same thing. Go to school. 🎒 Get a good education. 📚 Get a good job an

If you've never read the book "Rich Dad, Poor Dad" before, it is a read that I highly recommend. You can grab a copy here: https://amzn.to/3yWPEaL It's a book that set in stone and changed my perspect

People often claim that to retire they need to save, save and then save some more. But what happens to your savings, is that it is dwindled away over long periods of time if not invested. Here’s why �