Triplex in Arlington Deal Help

[Chuong Pham]

Hi everyone,

I am currently looking at a deal that is listed on MLS as a triplex 2/1.5, 1/1, 1/1 but i believe it was a SFH that was converted to a tri. The property is also zone for commercial but sold as a tri residential. However that property is about 80K but it will need about 30-40K of reno done to make it livable.

This is the condition of the property.

1. 1 meter for both water and electric, Utility was estimated to be around 600 per month total for all 3 units.

2. Rent is combine is about 1300, but with improvement i think we can get about 1800-2000 in total rent

3. Taxes and Insurance base on my estimate are about 3000/yr

Base on my estimate this could be a potential value added rental with about 12-15% annual return. Also, the property will be the most expensive within a 1 mile radius after renovation.

My concerns and Questions:

1. Will this be an issue with the city when i start renovation due to the property being zone for commercial? 

2. The property does not have a separate address can i just put a individual mail box for each unit?

3. How do i handle the utility expense split?

This will be a cash flow property for me. Thank you again for your help.