Investor · Laurel, MD · Member since 2012 · 149 posts · 33 votes
I'm trying to analyze a 31-unit in a small midwest town. Right nearby, there's a larger apartment complex, maybe 100 units. The two are essentially on adjacent plots of land.
Would you try to contact the owner/manager of the neighboring complex prior to putting in an offer and what questions would you ask them? Would you tell them you are looking to buy the property next door or would you not mention it?
I really think the bigger complex people could be a source of invaluable information. The trick is extracting it from them. Ideally, if I could get them to answer my questions, I would ask (granted, I may be pushing my luck with some of these):
1) what are your rents and vacancy rates?
2) what is your typical tenant profile?
3) what is the demand for rentals in this area?
4) what do you know about the apartment complex next door?
Real Estate Lender · Jacksonville, FL · Member since 2015 · 86 posts · 51 votes
11y
I do this all the time as we are financing properties for our clients. It is imperative to know the comps in the area for financing.
The larger complexes are used to doing market surveys. So just tell them you are doing a multifamily market study and 99% of the time they will oblige. I doubt you will have any trouble getting most of these questions answered in regards to vacancy and rent levels. They may or may not share any demographic tenant profile information as they do not want to be construed as breaking any Fair Housing type laws.
I would also ask if they are market rate or affordable. Ask about Rental concessions. This will give you an idea of how much competition is in the area and their occupancy rates and trends.
Thanks for the ideas! I thought about calling as if I was a potential tenant - that would be easy. But I like the market survey idea. As long as I am not lying about who I am or my intentions, I think it's a good thing to try. @Brent Shryock