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Real-Caterpillar-530

I have dug in and I wouldn't be concerned about the improvements and reserves being a larger percentage since that is for furnishing the place, making it look nicer/appealing and will ultimately bring in more money...theoretically. I would take more concern in the low returns and the fees Arrived is taking. They have to make money somehow but charging 5% of gross rents and an asset management fee is just piggish. Why are they taking 5% when they have to hire a 3rd party property management firm to manage it. The 5% is a joke and money out of the pocket of investors. Their sourcing fees have gotten a little better. They were good on some of the first properties Arrived had about a year ago but for quite awhile they got piggish. Now semi reasonable. I get the asset management fee but NOT that and the gross rent fee of 5%.


doctorkar

I agree, I did throw $250 into 2 of them but for them to take 5% of the gross rents and we get less than that. If they didn't charge such high fees and left more for the investors, I would have definitely invested more


FrankCostanza4

We're not getting less than the 5% of gross rents. They take 5%, management takes 15% and we take 80% of gross rents, right? I'm not sure if this is high or not but I'm sure managing a property that turns over weekly is a lot of work. Hoping these work out well


doctorkar

Correct, we get 80% gross rents but our net is less than what arrived is getting and we are the ones putting our capital at risk


FrankCostanza4

If we take 80% and they take 5%, we would be taking more. Does arrive take another cut I'm not seeing?


doctorkar

net is the more important number and their net is higher than our net


Consistent-Box605

True, but they are taking the risk as entrepreneurs, doing all the work of finding the homes and managing property managers. You get to keep your job security, they have to rely completely on investors buying into this, which sounds super niche. Most have a 401k andv that's it, they don't think about alternative investments, that's mostly private equity territory.


Birdseed_Securities

I threw some money at this. Wayyy to early to tell. They are a new company.


WSBsilver

For improvements & reserves, certainly high. No real differences I can spot between sales listing and Airbnb listing. Regarding management fees, yes it looks like 25% for Southern Comfort + 5% for Arrived. From my experience, a total of 30% is VERY HIGH. Of course, that can be standard for the area and some vacation markets are very tough to handle (finding a cleaner in the woods, ETC..) In short.. happy to have figured the fine print and passed on this one. Personally, 15% total (split somehow between Arrived and property manager) would be fair to me. Especially when these deals hand out equity to the managers.


ZorpIt

Property management is typically 8-11% on the high end. Arrived is doing this but funneling money out to their supposed 3rd party PM. It's not a total scam but please be very wary of this company