Just closed on another 12 unit in Saginaw, MI

[Janell E.]

Investment Info:

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

Purchase price: $850,000

12 units (two 6 unit buildings) bought with a combination of bank and seller financing. We only had to bring $40k to closing on this one. We brought on another partner who was instrumental in working with the seller regarding the seller financing portion of this deal. 2 units are vacant that need some moderate tlc that should be able to be tackled in a weeks time.

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

We've been looking for larger multi-family in the area for the past 8 months. We had 2 deals under contract that had fallen through during this time. It's in a good area of town and seemed like a great price.

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

We have a mutual CPA that knew we were looking and he committed to finding us a deal before the year ended... he found one within 2 months!

How did you finance this deal?

Combination of bank financing and seller financing. We brought $40k to closing.

How did you add value to the deal?

Planning to do some light rehab to units as they become vacant and increase the below market rents over time.

What was the outcome?

The appraisal came in at $25k over the purchase price. We closed only a few days ago, so still getting our bearings. One of the partners is going to air bnb arbitrage from the company, so we're eager to see how that goes. If it does well, we might consider short term/medium term rentals for the other units.

Lessons learned? Challenges?

Don't pick a closing company based on the fees they charge. Our closing was delayed a good 2 weeks due to mis-communications with the bank and people going on vacation.. that was thousands of dollars in rent.

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

No