10%/$70k Equity Needed for Exceptional Chicago 4-Flat Flip

[Patrick Milhaupt]

I have an exceptional proper 4-flat apartment building in one of the most undervalued Chicago neighborhoods which I sourced, negotiated and contracted for 20% below market. The property is held and managed in a family trust and has been well maintained but with tenants whose longstanding MTM rents never increased. Further, the units are listed as 1x1 yet are 1,200 sf each and easily convertible to 3x1. The conversion cost of $5k-$8k will triple the rents with cosmetic beautification and sound marketing. Originally an FHA loan in place, the appraiser refuses to acknowledge the comparable floorplans are 2x1 or 3x1, and therefore does not hit 1.25 DCR. Rather than fighting that battle, I would rather split the 20% down for a conventional loan with someone who understands how value is identified and created. $70k (or 10% of cost) is needed, with an expected conversion-flip to return $150k following a sale in peak summer season at the upgraded rents. Very simple: no pref, just a 50/50 split, true partnership and shared risk. A homerun deal I have scoured the market 9 months to find.