Purchasing Duplex, converting to triplex

[Daniel Johnson]

I am working on an offer to purchase a property that is currently a duplex. It has strong cashflow, and is in a desirable area of town. The zoning allows for a triplex, and the unit most likely used to be an illegal quadplex that was converted back to a legal duplex. Because of this, there is opportunity to take a currently unused space in the attic, renovate it and lease it.

A few issues: there have only been 2 duplex transactions in the area in the last year, and very few 2+ multifamily transactions overall in the last year. My goal would be to purchase the home, renovate the attic space, lease the space and refinance a significant amount of my capital back out. Without any decent comps, how would an appraiser evaluate the Triplex? Additionally, most refinance mortgages I am finding limit cash out refis to 65% LTV. Any good strategies for being able to do a cash out refi up to 75-80% LTV?

This is my first move into a BRRRR type strategy, just trying to think through how I should approach it.