Fourplex in Kannapolis with a NCDOT cherry on top

[Thomas Magill]

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Kannapolis.

Purchase price: $210,000
Cash invested: $20,000

Contributors:
Thomas Nance

The previous owner of this property was looking to cash out on this asset quickly to help fund a new build community. We purchased this property off the MLS in 2019 and replaced the roof and renovated the vacant unit of an inherited tenant who's lease expired. Within the first 3 months we only had 1 paying tenant and no one wanted to rent from us even at a reduced amount, but we were getting a lot of applications and people were paying the application fee whiched helped us pay our mortgage.

What made you interested in investing in this type of deal?

This was my first rental property purchase and I partnered with a seasoned investor to help me show the ways of the dragon. I found the property on the MLS and negotiated the sale, my partner brought the private money and we were closed within 10 Days.

How did you find this deal and how did you negotiate it?

I found the deal on the MLS from a seller who owned a considerable amount of small multifamily rentals. We negotiated a purchase price with the seller and were closed within 10 days. In addition, the NCDOT bought 5' of the front of our property to widen the road. I negotiated an amount that was beneficial for both of us, but it took a very long time to get the money for one reason or another.

How did you finance this deal?

My partner on the deal brought in private money and then we refinance through a traditional 30 year mortgage.

How did you add value to the deal?

We added a new roof replaced some HVACs and renovated the interiors of each unit.

What was the outcome?

We finished our refinance early this year and collected our NCDOT funds and the property is doing well

Lessons learned? Challenges?

The biggest lesson learned is to have reserves because you may be inheriting really bad tenants, so you'll need reserves to float you while things are getting worked out.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No