Buying a motel, should I convert to multifamily?

[Alix Cassagnol]

I am in the process of buying a 25 unit motel. The current owners have been operating for about 40 yrs and have bad record keeping. They say the expenses are 10k and the income is 25k. It is in ideal location for a multifamily conversion and is zoned for multifamily. Just curious if there are any suggestions on keeping it as a motel or multifamily. The price seems pretty good at 900k. Looking for some advice.

[Evan Polaski]

@Alix Cassagnol I am not sure how far "in the process of buying" you are, but from the limited info you present, I would say pass on the deal.  Why am I confident in my opinion: per your post you are not even sure what to do with the property.  

Nothing is a good deal if you don't know what you are going to do with it.  I can already think of about 50 questions that I would want an answer for before I would begin the buying process of anything.  I.e.

For a motel: what is your RevPAR and occupancy, what are your staffing needs and payroll associated, marketing budgets, renovation budget with any ADA upgrades needed, reserves, internet booking service.  Is a motel even a legal use, since in typical zoning that is a lower class than MF.

For apartment conversion: conversion budget, ada upgrades needed, fire suppression and emergency exit requirements, occupancy, management.  What are comps valued at, market rents, occupancy, financing, etc.