My First Commercial Multifamily

[Tyler Wehrung]

Hello BP,

I've been on the hunt for a 5+ unit building for awhile now and have finally found one in my local area (northern Cincinnati) that the numbers look decent on.  It's a little bigger than I was planning on, but I don't want that to be an excuse for me to walk away from it.

High level numbers:

12 units, asking price is 550k (I'm planning on 525K top dollar offer), rents are 650, has been recently updated.

Assuming 45% expenses - Capex- 10, repairs 10, property mgmt. 10, vacancy 5, taxes & insurance 10 (These are the numbers I use for my other rentals in the area) I should cash flow almost 1200 and have a 10% CoC return.

I should also add the terms that I'm pretty confident I can obtain with a local lender I have a relationship with. 25% down, 20 year amortization at 5%.

I'de like guidance, thoughts, suggestions on the items below:

- Is it wrong to assume the same expenses for multifamily as SFH's?

- I don't have the full 25% down, should I look for private money for the rest of the down payment or look for a partner? (this is probably subjective)

- Any other things to consider before making what feels like a major leap into a larger multifamily?

Thanks in advance!

Tyler