10 Unit apartment Deal Analysis

[Shawn Pehrson]

I am looking at a 10 unit apartment in a smaller town in southern MN. The building is currently vacant with no tenants has been for 3 yrs.  I have only walked around the outside of the building at this time. It is in a smaller town however there is some larger businesses in the area. It is the county seat as well. In speaking to the owner they are efficiency apartments with 4 of them on the larger side for efficiency units. PP is 87,000 building is in fairly good condition, but could use a few new windows, and I am sure some remodeling on the inside. I would figure on doing aprox 30-40,000 in rehab but not sure depends on inside.  Taxes are about 2400/ year and not sure on utilities or anything else because it is vacant. I have a call in to get some of the old numbers. Elec and gas are not separate. I am thinking rents would be about $500 for larger units (4units) and $350 (6) for smaller units. I also thought about combining a couple units to get some 2 bdrms. Another play would be is to save 1 or 2 units and do short term rentals. Gross rents I figure would be about 49,200 when 100% rented. What does everyone think on the numbers?