RG 113 – Stop Being a ROOKIE when it Comes to Underwriting Large Multifamily Deals with Omar Khan

Reed Goossens
April 29, 2018
Real Estate Investment

RG 113 – Stop Being a ROOKIE when it Comes to Underwriting Large Multifamily Deals with Omar Khan

About Omar

  • Omar is a Canadian
  • Omar works in commercial real estate
  • Omar teaches modelling

Nuts and Bolts

Omar Khan is a CFA charter holder, an institutional financial underwriting expert and he has over 10 years experience investing in US real estate. Omar has advised on over $3.7 billion dollars worth of capital financing and M&A transactions. Now he does syndicated multifamily deals across the US and lives in Dallas. Omar made his first dollar when he was 13 years old teaching people to type on a keyboard. Omar graduated from the University of Toronto and worked for RVC as an asset manager in Canada, he then went to work in oil after an old boss poached him. He worked in oil doing capital financing and M&A equity research. During this time he also passed the CFA exams and he me this wife who is a doctor in the US. They decided to move to Dallas together.

In Dallas both Omar and his wife were working 60-80 hours a week and so when they decided to invest in real estate they couldn’t afford the time for a project – they needed to buy somewhere that could make money without having to spend time fixing it. This is why Omar started investing in commercial real estate rather than single family assets. He started his journey going to RIA’s and meet up groups. At these groups he saw lots of people sharing their investment models, so he asked to see them and was shocked to see that most weren’t very good and full of basic errors.

When Omar analyses at a model he’s looking for a basic assumption of revenue and expenses to be backed up by historical numbers or credible data. He is hoping not to see any made up figures or assumptions without justification. The model should also be well presented with consistent formatting, well printed in an easy to read format, containing market specific data and showing well written formulas. He also looks for input and output calculations in separate tabs and within each tab all inputs and outputs should be separated out.

When Omar started modelling his own investment plans he realised that if he wanted to earn $1 million he needed at least 20 investors which meant he needed to talk to between 100-140 people minimum. The deals that Omar runs require larger investments than the usual $20,000 passive investor levels and with these larger investments comes greater risk and therefore Omar needs a fully coordinated mitigation strategy. These deals are called private placements.

Omar explains that all multifamily models and value add models are T12 models with cash flow modelling on top, which means they’re not very complicated. He creates and has been teaching modelling for 10-12 years. Omar’s advice for anyone wanting to be a syndicator is to get better at modelling, but don’t be disheartened because everyone makes mistakes and if possible try and partner with a person who has different skills to you.

Top investing tips

  • Most important habit – Goal writing and visualisation
  • Most important tool – Excel on his phone
  • Most influential person – His father
  • Most impactful failure – Not going in for the kill as many times as he should have

Contact – omar@boardwalkwealth.com

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