Multifamily investors in Macon, GA

[Winn Merwin]

Hello BP,

I have stumbled across a potential off-market 8 unit property in Macon, GA. I was calling on a duplex for sale in my farm area of Augusta, Ga and the owner mentioned that the duplex I called about had already been sold, but he had an 8 unit property he would sell in Macon, GA.

We currently have 2 SFR's and a Duplex in Augusta, but would like to get into larger properties if the opportunity is a good one.

The 8-unit property is 3 separate houses divided into 8 apartments. Within walking distance of the Mercer Law School and in the historical district. 

I am having a difficult time determining an appropriate cap rate to get a valuation. Is there anyone out there with some knowledge of Macon, GA? Should I just call brokers in the area and ask about cap rates?

Rents are $4,100/ mo. when fully rented, but 3 units are currently vacant. Tomorrow I plan to ask for trailing 12 month finances and a rent roll. 

It seems like a mom and pop type operation with room to improve management. The owner is retiring and wants to be done with the property. 

Any guidance regarding how to proceed would be appreciated.

Thanks in advance,

Winn and Kaitlin Merwin

[Kon Zel]

Generally sellers will not disclose T12 or rent roll information until you're under contract. So don't be offended if they turn down your request. For multifamily, financial due dilligence starts after contract is signed.

It sounds like you have most of what you need to model your offer price (rents, vacancy, expenses). Call a broker in the area or get access to commercial real estate web sites to get an idea for cap rates in the area. Then submit a LOI based on that.