Real numbers on one of my multifamily projects

[Cindy Shen]

Recently lots of people reached out and expressed interest in Multifamily and wanted to know more details and how past projects went. So, I have compiled some stats. Below is an update on an asset that's already finished and stabilized.

It's a small multifamily with 6 units in Hamilton, ON. The reason for asset acquisition at the time of purchase: distressed with deep discount off market price; grossly mis-managed; rents were significantly below market rent; right in front of a park; new LRT is within 200 meters. All of these pointed to significant forced appreciation. The ROI upon 5 year exit was estimated to be 17%+.

Original plan was doing 1 phase of renovation for every unit; Phase 1 was completed on budget and on time; however, we realized that there was an opportunity to increase cashflow even more by installing paid lockers as well as re-planning parking lots. That become phase 2 with a bit of further investment. Phase 1 and 2 were completed under 12 month, with all units rented out at higher than forecasted market rents at full capacity; Lockers and parkings were also fully rented out boosting building revenue and cashflow as well. At the first refinance after stabilization was completed, the building was appraised at $475,000 higher than acquisition price, with about 30% initial investment repaid back to investor and with 5 year expected ROI at exit increased to 23%.

This asset is already stabilized with positive cashflow. 

Interestingly enough, I'm also buying the building next door right now due to lots of reasons. And a few more buildings are WIP. I will share those as well if people are interested to know.