New Bee Deal Analysis 21-Unit

[Mike Zhou]

I got a proposal for following deal and this is my first time to invest in multi-family venture and would like your feedback on how to structure the deal.

Property: 21 unit + 2 unfinished.  built 1955

Annual Taxes $4,190.40

● 2 2 Bedroom units rents $550

● 9 1 bedroom units rents $450

● 5 large studios rents $350

● 5 small studios rents $300

Total building sq ft 9,664

Numbers

Monthly Current rent $3,525.00 (all tenants )

Total $1,186.07

Cap Rate 0.32

There no comps but property can be value over $200k once fully occupied and manage

well.

Your investment would be secured by property alone with purchase price under 100k.

Repairs estimate 30-35k.

I am proposing a loan of $95,000 with a open line of credit for repairs for 5 years, with

option of early payoff.

$95,000.00

5 years

$2,000 a month

Should I request some equity percentage like 50% when the sale happens or cash out refinance to pay back the principal in 5 years which ever happens. I still entitle the 50% NOI cash flow if still holding.

Thanks for your feedback.

[William Coet]

Originally posted by @Mike Zhou:

William, that is gross rent with 50% occupancy. That is in IL. 

Whats the purchase price again?