Value add triplex with additional lots

[Thomas Wiedenman]

Investment Info:

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

Purchase price: $590,000
Cash invested: $200,000

3 unit apartment building with 3 garages. Used proceeds from another investment property to 1031 into this property.
Subdivided the property into 3 lots- 2 single family and a triplex with 3 garages.

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

Value add property. renovated the existing triplex and garages and then subdivided for 2 additional lots.

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

Found on the MLS. Owner had a full price cash offer when I first walked the site. Owner went with my discounted bank loan offer because I had a realistic plan for the property that could get zoning permits.

How did you finance this deal?

mortgage with a large deposit from a 1031. Took out an equity loan to renovate.

How did you add value to the deal?

Full renovation, with all new Hvac, Kitchens and Laundry rooms in each unit.

What was the outcome?

Rented very quick for more money than expected.

Lessons learned? Challenges?

Pick a very good contractor if you are renovating a multifamily. I had several issues arise after tenants moved in.

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

Used Houzer for the property purchase and to sell my old house, they were good. Used 1031 Corp for the 1031 exchange and they were great.