Buying 12 Unit....all Section 8 tenants

[Russell Beach]

I'm considering putting in a LOI on a 12 Unit apartment in Virginia where all the tenants are Section 8. I have underwritten the deal and looked at rent rolls and T12 and last operating statements and it cash flows very well. About 15% cash on cash. The rent rolls didn't reveal all 12 tenants were section 8, but it came out in some broker conversations. All of the tenants are long term tenants as well----5-10 years. This Section 8 revelation has me taking a pause.

My questions to those who've apartments that were already very heavy with Sec 8 tenants:

1). How hard is it getting approved as the new owner/landlord to accept Section 8? Should I budget for a pause in these 12 tenants' Section ACH payments after closing? If so, how long?

2). Anyone have experience in which the Section 8 inspector comes down hard in the new owner to make capex improvements prior to getting approved to be a Section 8 landlord?

3). Would you require a property manager to have extensive Section 8 experience?

4). Any other concerns or blindspots here?

Thank you in advance!