Indianapolis Project: Seeking Advice/Investor

[Evan Manship]

Help!

I purchased a 7,000 square foot, 4-unit multi-family home last September with the intent of utilizing a FHA 203k loan to rehab and lease the units while living in one of them for free. However, after a long story, I closed on the deal in cash using hard money and have been sitting on it ever since.

I am wanting to rehab this property and lease it out OR convert these units into condos and sell them all off individually.

My fear is that if I continue looking for an investor to partner with I may not find one and holding costs will add up and at the same time, utilizing a huge loan with huge PMI sounds very risky to me and I'd like to avoid it if I can. It's a true catch 22.

Details:

Purchase Price - $90,000

Current Market Value - $130,000

Square Feet - ~7,000

Units - 4 (separate entrances, basements, meters, etc.)

Rehab Needed -$250,000 (conservative)

Post Rehab Est. Monthly Rent - $3,600 ($4,800 once I move out)

Post Rehab Est. Annual Rent - $43,200 ($57,600 once I move out)

Annual NOI based on 50% rule = $28,800

Cap Rate = 8%

Est. Value based on income approach = $360,000

If sold as condos.....

Post Rehab Per Unit Sale Price - $125,000

I think this project if done correctly can provide very solid footing for my imminent plan of being a full time investor. I have been stressing about this project for months and I am in need of serious developer/investor/friendly advice. What do I do?

Get a mortgage? Pursue joint venture? Or just sell it all together? I want to move forward with other projects and this one particularly is taking up a lot of time and money. Help!