First Multifamily Deal- 18 Unit Apartment Complex

[Scott Szpyrka]

Hey BiggerPockets Family! 

I wanted to share a big win with all of you. I closed on my first Apartment deal, partnering with my mentors. See below for deal details and the story. 

Deal Size: 18 units

Location: Knoxville, TN

Purchase Price: $3 MM (166.6K per door)

Year Built: 2014

𝐃𝐞𝐚𝐥 𝐏𝐥𝐚𝐧:Due to the demand for long-term rentals in Knoxville, we plan to convert the units from student housing to long-term rentals, giving us significant rent upside and better long-term debt options. Because this is a newer deal, there is very minimal cap-ex on it, and most of the play was to increase rents. We purchased this deal using a local community bank. Once all rents are at the market (year 2-3) we plan on securing long agency financing so we can continue to cash flow with longer I.O. periods and amortization. This will also allow us to pull out some if not all of our initial capital investment in the deal. Let me know if you have any questions on the deal or I can help in any way! 

[Peter Nikic]

Congrats! I closed on a small 9 Family in Chattanooga last year, I used Pinnacle Bank. Which bank did you use? I'm curious.

Also, some of the student housing units in that area are more like rooms rather than apartments, how are you able to reverse those into apartments?