24 Unit 100% Efficiency Apartment Complex

[Aaron Rowzee]

I've got a solid lead on a 24 unit complex in a good part of town, however, the units are all efficiencies with no walls except bathroom. I'm not sure if there is any laundry hookups in the units, but there is no laundry mat onsite, so for the sake of conversation lets assume stack-able washer/dryer in each unit and 2 parking spots per unit. Water is included, but I would immediately work on sub-metering, and the building is landlocked with no way to add value like storage buildings to rent to each tenant, etc. 

No word on price, pro forma, etc its a brand new lead and the owner is preparing to sell within the next few months. My main question is whether or not I even pursue in this hot market? Is there ever really a demand for efficiencies to the point where they perform as well as larger units and SFH? This small of an apartment is actually not common in my area, and I've only really seen them, or lived in one when I was in college and in a nothing college town.

[Michael Badin]

In my experience you will find people looking for efficiency units, however I believe they are a much higher turn over rate than normal units. (Which means higher expenses). They also rent for less obviously.  I personally would not pursue an entire complex made solely of efficiency units, but that is me, it might work for you.