3-4 Unit building - Operate vs Flip

[Michael Wolffs]

I'm a new investor. I'm in the middle of my first deal. As it currently sits, it's a vacant three unit bulding. It's currently 3 x 1bed/1bath units. I intend to convert these into two bedroom units, and add a second bath to at least two of the units. I also will look into adding a basement 1 bedroom unit, but I don't know if this will be allowable under code. When this is done, I'll need to make the hold/operate vs flip decision.

Since I get this deal under contract, I read a few books from one of the fairly well know "gurus." While I was somewhat suspicious, he made a number of good points. One of the key ones being that investors shouldn't be managing their own properties, and should bring in professional management, and go out looking for more deals (not spend their time dealing with management issues.)

My issue with this property is that with only 3-4 units, I don't think it will flow enough cash to warrant/support professional management, and still be cash flow positive. It's also in an area that, while not yet gentrified, may be about to start that process. So I'm thinking, I may be better off just finishing the reno, flipping this out, and looking for larger unit count properties that are already operating, and are more viable for professional management.

What does everyone here think about this?