Can't raise rents, roofs leaking, people not paying rent -YIKES!

[Emily N.]

Hey BP friends!

I'm looking for some advice on a property in our portfolio. 

It's 150+ units in Oklahoma. Built in the 70s. Flat roofs. C+ property.

We purchased this property thinking we could reinvest all of its cash flow for the first few years into renovating apartments and bumping rents, eventually bringing it up to a B property or higher.

Instead, 13 out out of the 16 roofs are leaking beyond repair (we've already replaced 8 at ~$25k/roof), and we are seeing that even if we do renovate an apartment it sits vacant without any interest at even a small increase in price. (Yes, we did have a roof inspector look at all the roofs before closing, and yes he did say all of them were in GREAT condition!)

Residents also routinely skip out on rent and have no problem taking hits to their credit or with being sent to collections. Most applicants come in with credit scores in the 400s-500s with several evictions, criminal records, and/or money in collections from other debts.

Due to our loan terms, we can't sell this property for another 5 years without taking a crippling hit.

We are more than willing to put $ into this property, but not if it's just an endless sinkhole without any return...

Can anybody offer any tips/or suggestions for this situation we have found ourselves in? Or does anybody have any experience with this kind of market? Any help is welcome!

Thank you,

Emily