Ohio Apartment BRRRR

[Matthew Gardner]

Hello BP!

I would love to find a partner with experience/financing! 

Highlights and my own thoughts/calculations right here:

Deal breakdown:18 Units: 1Br/1BaPurchase Price: $245,000 - Cash offers only

Need of full renovation - seller already installed new roof and vinyl windows throughout (would need your expertise opinion for renovation costs/time). Private Garage available for tenants.

Location: Downtown Springfield, OH - Wittenberg College (1.1 miles), hospitals, restaurants close byFinancials: broken down on page 8 of package and in following section.

Plan: Classic BRRRR method. Based on the financials (I went even more conservative than they did in the offering package) using $70k for NOI financed at an 8% CAP (I am assuming thats what banks will finance for), would finance for $875k... LTV of 75% on that would leave $656k and $218k in equity. Assuming we aren't able to negotiate the price any lower than $245k, that would leave a budget of just over $410k for the renovation project to leave no money in the deal at the end. (Maybe I'm slightly off for holding costs).

This should leave a good amount of cashflow after the refinance with expenses estimated at $4500-5000/mo and income around $10,000-11,000/mo.

At the moment I do not have finances lined up, however have come across multiple sites that offer Hard money for real estate lending. If a potential partner would like to come in on the deal with me, with the financing available, I did not want to prematurely lock in any other finances.

I would love to hear what people with a more experienced eye notice about the deal that I may have overlooked.

Thanks in advance!

Matthew Gardner