Multi-Family Conversions

[Orion Ross]

Hi, I am looking to start purchasing multi-family properties in and around downtown Lincoln, NE and am looking for some feedback from people who have owned similar properties in the area.  I plan on managing these properties myself but have a short list of electricians, plumbers, and one handy man for small fixes.  Here is my pros/cons list:

Pros: High ROI (12-15% cap rate), high demand for housing, low unemployment, depreciated/buyers market

Cons: Buildings are typically over 100+ years old, lower income tenants, newer apartment projects beginning near Nebraska University, not great outlook for properties to appreciate in value

-Will maintenance be an absolute nightmare?  I am predicting 15-20% of gross.  What is the downside to a conversion vs. true build?  Thanks for everyones feedback.  

[Lance A White]

Multifamily conversions all have the same cons: electrical and gas workings and meters are difficult to maintain. They are cheap to buy and hard to sell. I have some, but would rather own buildings designed and built as multifamily.