Concerns with investing in multifamily property in Ga

[Sunny Abbasi]

Hi all,

I recently got a lead on a multifamily (15+) property in a mid-size town Ga (population 50k-100k). I walked the property and surrounding area. My analysis is this:

Cons- I personally found the downtown and surrounding areas to be very depressing and almost empty (vacant shops, office spaces, neglected buildings and storefronts). Based on my research there is a lower than average population growth and higher than average unemployment. The primary area employers are a hospital and military base. I was unable to find anything online suggesting any future plans for investment/ revitalization so I wouldn't be counting on an appreciation play. Additionally, I don't normally invest out of town so I would need to hire property management.

Pros- The apartments are well located within the city, and appear to be in good condition. The cash flow looks great and property seems to have great potential for value add by increasing rents. There are a few apartments in the surrounding area that have decent occupancy (90% or a little above). My current investment strategy is multifamily buy and hold, focusing on cash flow.

To me, the market rent (~$750/ 1 bed) is surprisingly high when the city seems to be dying and property values are so low. However, I keep running the numbers and based on the market rent the cash flow is really solid. 

I'd love to hear from investors who have invested in areas where the cash flow is good but the economic indicators are not. How did things turn out in the long run? Thanks everyone for taking the time to read and respond!