24 Unit Value-Add deal Jacksonville, FL

[Chris Grenzig]

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $1,920,000
Cash invested: $830,000

24 Unit Value-Add property in Jacksonville, FL. We bought this 6 pack of quadplexes all right next to each other through a double wholesale and we were able to close cash in 3 weeks and then refinance into an 80% LTV loan. The property appraised for $105k a door and we bought it for $80k a door. We've increased rents $350 in 12 months and should increase them $600+ once all units are renovated and brought to market rents. We should refi out 100%+ of our money inside 24 months.

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

Unbelievable purchase price in an area of town that was growing fast, with a large amount of upside to income and renoavtions/

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

Off-market through a double wholesale. We had to close cash in 3 weeks.

How did you finance this deal?

Hard money loan to close, then refinanced into a 80% LTV life insurance loan.

How did you add value to the deal?

We are spending $12-18k per unit on interior renovations. We've also fixed a lot of rotted wood siding, re-painted every building, and done other exterior fixes.

What was the outcome?

We have been able to raise rents $350+ inside 16 months and should continue that to $600+ inside 30 months.

Lessons learned? Challenges?

Fast contractors are better than cheap contractors.

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

Jim Hoggat - Walker & Dunlop Mortgage Broker
Jordan Feldman - Rampart Insurance