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Updated over 7 years ago on . Most recent reply

User Stats

74
Posts
26
Votes
Brandon Purdeu
  • Investor
  • Fayetteville, NC
26
Votes |
74
Posts

First Multi family deal

Brandon Purdeu
  • Investor
  • Fayetteville, NC
Posted

Looking for a little help. 

I’m making the leap from flips into multi family complexes. Found 12 units in a C class neighborhood for 180,000 that we’re severely damaged from Hurricane Matthew and are being sold short as the owner can not repair. All units are vacant and need to be remodeled to be rent ready. 

Here's the basic numbers: 
Purchase price: 180,000
Rehab: 200,000
Retail Value: 475,000

Here is pro forma created by myself: 

I have a couple of questions. 
1. Are my numbers reasonable on expenses and occupancy rates? 
2. I have a total of around $100,000 to put into the deal but need $400,000. I am meeting with a local bank to discuss options but any other ideas on where to come up with capital and how to fund this deal? 
3. If I fund this deal with friends and family what does the compensation model look like for them? I've seen the model of a 6% preferred rate of return but then how do you rate the return is it on total cash flow or on their investment? Also how to you slice them into the exit strategy? 

Preferred exit strategy is the remodel, season and refinance my cash out of the deal to rinse and repeat. 

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