Motel Conversions are AWESOME SAUCE

[Katherine Wiltse]

Investment Info:

Large multi-family (5+ units) commercial investment investment.

Purchase price: $375,000
Cash invested: $150,000

I have become an all-in-one real estate agent/construction manager/and (while the asset is being stabilized) property manager. This deal is for a client and we are just wrapping up. The numbers should be $550,000 with purchase price and rehab. This is for a 20 unit motel that we converted into long term apartments. Once fully occupied we will get a commercial appraisal and BRRRR. I think it will get a commercial appraisal at 1 mil at the least. Probably more like 1.2 milI. Its a sweet one.

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

The numbers!!!

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

I am a real estate agent, with an investor mindset and always have my eye out for deals. I wanted to buy this one myself, but couldn't scrape it together for the down. Instead, I am knocking it out of the park for my client.

How did you finance this deal?

My client bought the deal cash, but he is going to BRRRR once we get a commercial appraisal. He had never heard of this strategy and it took a few rounds of explaining, before he totally understood. Then his eyes got wide as saucers and his grin ear to ear.

How did you add value to the deal?

I literally have taken care of everything. Even negotiating a zoning change for a section of the property. I have truly handled every detail of this deal.

What was the outcome?

I am trying to figure out if it will be a homerun or a grand slam? I don't have enough experience to know. I just know it is a good one. I think conversion is a real sweet spot right now.

Lessons learned? Challenges?

Oh my. Fire people clean and swift. A good project should have a wake of destruction that is quickly learned from and cleaned up. Lots of carnage. LOL.

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

I recommend me. Really. I did good on this one.