Creative Deal Analysis

[Max Bellino]

https://www.zillow.com/homedetails/15-Windle-Ave-North-Graft...

Hey Guys, 

I’m working on a deal that’s a bit complicated due to the subdivision of land, and I’m having trouble accurately comping the subdivided parcels. Does anyone have advice on how to approach this or know of a good broker specializing in vacant residential land?

Here’s my thinking so far: the property’s been on the market for over a year, and I know they had an offer for $500K. I’m considering coming in with an offer around $600K to $650K with seller financing and setting balloon payments once the land is sold. My goal is to get the single-family house and warehouse for around $400K, which would value the land at $250K across three lots. So after the land is sold have the last balloon payment to get a loan on the new lot with the less land. 

(Lot's are roughly going to be .5 of a acer in north Grafton Ma)

I do have a few concerns: one lot has a FEMA line running through it, two lots are next to a railway, and the terrain is hilly. I haven't toured the single-family home yet, but it likely needs work, and the warehouse would as well. I estimate the house could rent for $2.8K–$3K, while the warehouse might rent for (one unit) $2K–$4K, depending on how much work it needs to suit different tenants. So with another 100K in construction/fix up cost bringing the total to 500K it meets the 1% rule, obviously I would do more underwriting but I need to be solid on those comps.

Any thoughts or advice on this strategy? Or know anyone who specializes in land brokerage. Do you think it's worth my time to get this warehouse hack for free?

Best,

Bobo