Gorilla Capital flexes its muscles.
By Erin J. Bernard
It’s not easy to spook Gorilla Capital CEO John Helmick.
Over the course of 10 years spent buying, remodeling and selling distressed homes, he and his team have stood cheek to jowl with a shudder-inducing menagerie of creepy creatures, from raccoons and cats to rats, bats and buzzing bees.
“Just because a house is vacant of people doesn’t mean it’s vacant of animals,” Helmick says. “These are vacant, abandoned, empty houses that attract a lot of nuisances. We’ve seen some weird stuff.”
In the distressed real estate market, where surprises are the rule, cooler heads and a bit of ingenuity definitely prevail, Gorilla has learned. Most of these unwelcome inhabitants can be trapped or flushed out, while beekeepers will often harvest those dripping hives for free.
Those instincts for unflappability have enabled this privately held Eugene-based investment fund to grow over a volatile decade from a DIY startup into a hulking fix-and-flip giant operating across Oregon (the Portland market excepting) and in 21 other states, with sales topping 70 million last year.
Gorilla’s approach is so simple, even an ape could see its wisdom: Buy the homes nobody wants, increase their value through smart renovations, then pass those savings on to homebuyers. And grow bigger by building strong capital partnerships with the seasoned fix-and-flip operators who already have footholds in your desired markets.
But even great apes must evolve: Helmick has designs to double Gorilla’s bulk in 2016 by expanding its capital pool, going after more deeply distressed homes and increasingly emphasizing its flourishing Fix & Flip Funding and Support program, all while staying true to that scrappy, homegrown startup ethos.
Gorilla’s fix-and-flip partnerships benefit every stakeholder, Helmick explains: With Gorilla covering overhead and logistics, local fix-and-flip operators can better focus on reviving the dilapidated homes blighting neighborhoods across the country.
These houses are often desperate for a little TLC, says vice president of operations Tanja Baker, who’s been with Gorilla since its inception: “We typically buy the house no one else wants to buy. It’s not financeable, it’s totally trashed, it’s in worse shape than any house you’ve ever stepped in ... It’s not even inhabitable.”
Foreclosures can take years to process, and a vacant home can fall into ruin in mere months. When this happens over and over, major quality-of-life issues result.
Fix those homes and resell them to new owner-occupants, says Helmick, and you’ve revitalized both that property and its surrounding neighborhood: “People who live on these streets come and thank us for fixing the house because it was the worst in the neighborhood, and then they usually point over their shoulder and say, ‘Can you fix that one next? Because it’s the second worst.’”
In the distressed real estate game, each market and each home is its own beast, which makes a cool head and a bit of vision even more essential, says Baker: “I used to look at distressed homes and think there is no way it can be fixed, but we can, and we do. The before-and-after photos are really quite amazing.”
Beehives or none, such evolutions are always a sight to behold, agrees Helmick: “Homes go from smelling like cat urine to fresh sawdust to fresh paint.”
Mark Genovese Sunday, 19 August 2018 20:37 Comment Link
My home in Eugene Oregon was fourxlosed on and sold at sheriff sale. I have a short time to redeem the property and I am looking for someone who flips homes or buys redemstion rights. How would one go about finding out where to look for such person?
Thank you for your time and help with this matter.