Funding a School Conversion

[Tyler Buck]

I own a few SFH and closing on 1 duplex. I came across an opportunity for a school that I think would be a really great setup for apartments. I'm a bit out of my element when it comes to estimating costs and possible expenses on a building this size. I figure I could easily convert each room (10-15) into an apartment, but that leaves about 50% of the sqft not utilized. From an expense perspective, I ballpark this as somewhere from 400k-1 mil, but I'm not that cash rich. I can, however, purchase the existing property with a conventional loan. So I have a few questions here...

What is the best way to tackle a conversion like this from a finance side? Bank, HML, something else? (private equity is not available - tried in the past)

Should an apartment building be structured within an LLC or S-Corp? (Nothing held like that today)

Are there good ways to estimate these conversions? (I'm guessing a GC is the best resource)

Since I'm left over with about 50% of the sqft, I figure I could upsell and add a small gym. Any considerations there?

Finally, with so much space left over, could I try to have storage space for rent within the basement level or is that an issue for residences above those spaces? 

I appreciate any insight that you can share.

[John D Cozza]

Find an architect that is experienced in Adaptive Reuse and knows the local planning code and have them render an opinion if this property is viable for Adaptive Reuse.  If this property has the original plans that would be great, without plans you would want to get an estimate for creating some "As-Built" plans for understanding your MEP and FAR issues in relationship to the local planning code.

You need to know what you have before you can determine if you convert it over to residential and create a proforma.