buy and hold for fantastic long term returns

[Joe Malerba]

Investment Info:

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

Purchase price: $888,000
Cash invested: $500,000

We bought an old dilapidated 33 unit that had 8 sex offenders living in it, and 40% of the tenants were not paying or 9 months or more behind. All of the units needed to be redone, and the property needed a complete update. We spent the last three years redoing the units and changing some over to short term. We got rid of all of the problem tenants and with the updated property were able to attract a better quality tenant that takes better overall care of the property

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

We knew that the rents were way below market and by fixing it we would have a potential gold mine

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

We paid cash for the property as we bought it as is

How did you finance this deal?

we paid cash

How did you add value to the deal?

We remodeled one unit a month for the last three years and were able to increase the rents by 150% and the net cash flow by 500%

What was the outcome?

really fantastic property that is a much better fit for the local community

Lessons learned? Challenges?

Things take a little longer that you anticipate but patience and consistency make all the difference