Deal Diary: $27,000 in a month on a 2 unit Airbnb - Chicago STR

[Henry Lazerow]

YES you heard that right collected $27,000 in one single month! June of 2022 with just a 2 unit. This is one of my repeat clients deals. I have sold several multi unit flips for them. Their strategy is buy class A area, quality rehab, increase revenue and then flip with long term cap gains+amortization+appreciation after 2-3 years. They don't rush to flip as the deals cashflow and the bigger profits tend to be after compounding in holding for those 2-3 sometimes even 4-5 years. 

Location: Very edge of West Loop. Near Union Park and the Ashland green line stop. 

Purchase: Bought for $880,000 needing a complete gut rehab. Sounds high but it had large sq ft and was a beautiful greystone. The greystones are awesome for flips and can fetch very high ARV, they also rent well as seen by our numbers.

Financing: Deals are financed with a local banks commercial rehab loan (not hard money), then once project done and rented at market rates gets refinanced to pull cash back out.

Rehab: Each unit is a duplex up/down with 3br 3.5ba and finishes similar to what you see in high end single family houses. I am about to list the property so have to keep the exact budget confidential but it was pricey. Going high end is worth it when doing airbnb as can fetch you very good rents. The higher price guests also seem to be much easier to deal with. I have noticed the same pattern with my personal airbnb, you get the best/easiest guests with higher prices.

Nightly rate: The pricing is $899 a night per unit with no discounts and no changes for holidays, etc. My client keeps it simple and just does $899 all year all the time. They work full time day jobs and the whole thing runs pretty simple so it works well for them. I think by adjusting the rates they could even increase the gross rents. Maybe get $1500 range a night per a unit for lollapalooza dates, higher prices on game nights, etc.

If interested in how a smaller airbnb project works. I have another post about my personal 4 unit in Rogers Park project https://www.biggerpockets.com/... 

[Nathan Gesner]

What was the total investment after gut rehab, furnishing, etc? $27,000 in one month sounds really good, but it needs to be in context of cost.