Financing a gut Renovation in Clinton Hill / Bed Stuy Brooklyn NY

[Neil Stern]

Hello BP!

I have been presented with  an off market deal in the Clinton Hill/ Bed Stuy border in Brooklyn.  - purchase price would be 1.5 Million - its 4 stories and requires a gut renovation.

Supposing that this is a great deal - how would i finance the 600-700K renovation ?  

I expect to have four large units when done - Minimum two Bedrooms each. 

Questions - at face value , does the deal sound good? How would i finance the project?

Thanks!

Neil  

[Shmuel Harris]

Neil Stern
Hey, couple questions.
1) what do you mean "finance a 600-700k renovation? Is that how much you are looking to put into the property on top of the $1.5 million?
2)What are your potential exit strategies?
-A) You are looking to flip by increasing value in property with renovation..... What are comps in the local area? I know that some specific streets in Brooklyn have had record high sales of up to $15 million for a four-story property. If this is property is in that area then this might be a great opportunity. If comps in the area don't give you that spread then flipping is not an option here. Unless you're speculating that prices have been growing tremendously and that prices will continue to grow.
-B) You would like to rent out the property. I don't think the return on investment would really rationalize this course of action. What are comps in the area in regards to rentals? My impression was that rentals are not relative to the property price i ny.
let me know what you think of my two cents,
Shmuel Harris