Building a 4-plex in Portland, OR

[Nathan James]

Hi all,

I'm in the early stages of planning a development of a lot I own in SE Portland. There is a small (<600 sf) house on the lot currently, which is in pretty rough shape. I've owned the house for few years and have spent a lot of time trying to design an addition to add value to the property, but the current floor plan is really not conducive to realizing a return on that investment (tiny living room, low ceiling basement, poorly placed basement stairs, etc.). I have considered adding an ADU in the back, but since I am limited to 75% of the main house square footage, this is also probably not worth it.

     In the last couple months, the zoning has changed for my home, and the lot is now classified as RM1 (low-density multifamily), and I have learned that I can build 3+ units, and don't need to include any off street parking.  The minimum density is 3 units and there is no maximum number of units.  Instead, the code is now written that I can build as many units as I choose as long as they meet building code and the total floor area to lot area ratio is 1 to 1 (the lot is just over 6000 sf).  I'm leaning toward 2 duplexes to avoid needing sprinklers/commercial building code.

 I am a general contractor that specializes in kitchen remodels and high end custom cabinetry, but I'd like to use this project to pivot into more general contracting and property development.  I've worked in most phases of residential construction, but have not yet managed  a project this large.  

I guess this is an introduction of sorts, and a request for any help with the following questions.:

1)  I've spent some time lurking here on BP and using the calculators to analyze potential options.  Are there any resources available and recommended that would be better suited for creating a pro forma for new (spec) construction?

2) Does anyone have a general idea of what soft costs I could plan for if I sell the units as condos?

3) The lot is mid-block with only 50' of street-frontage.  Does anyone have thoughts on the value of adding parking?  I'm within a couple blocks of a max stop, and a block from a bus stop, so I am not required to include it (I don't think).  The new code requires a 30' x 30' courtyard or rear setback that is 25% the depth of the lot.  This makes including parking somewhat onerous.  I'm trying to weigh the value of including parking for all units vs. just parking for some (potentially larger) units, and perhaps even fitting an additional unit.  The property is in the Jade District if anyone has particular insight on the area.

4) I have some contacts for real estate agents, but I feel like they're better suited to assisting buying and selling SFR. I'd like to find an agent that has experience in selling smaller multifamily properties. How might I find someone to help with this?

I could go on and on, but basically I would love to get any insight into how I should approach this opportunity.  I'm not sure at this point if I'd like to sell the entire property as a whole when I'm finished, or sell each unit as a condo,or even keep the most or all units to rent. 

I have been blown away by the openness and general mutual helpfulness of this forum.  I appreciate any advice or insight on any of these questions, or any general advice you'd like to impart.

Thanks for your time,

Nathan James