First Quadplex - Newport, DE

[Jack Clough]

Last November, a partner and I purchased a quadplex in Newport, DE for 40k after negotiating directly with the owner who was way in over his head trying to rehab by himself (much more to that story...). 

This was a complete gut job of 4500 sf. There are two 3/1 units, one 2/1 unit and one 1/1 unit. It was a very big job, but my partner's construction company has done all the work and we are 90% complete after 3 months. Hoping to have it fully rented by 4/1. Then we'll refi and do it again. And by the way I have a possible deal on 6 duplexes (12 units) and could use some hard money lenders.

Summary

Purchase = 40k

Rehab = 160k

Total = 200k

ARV = 450k

Unit 1 = 1400/mo

Unit 2 = 1200/mo

Unit 3 = 900/mo

Unit 4 = 1300/mo

Total Rent = 4800/mo (2.4% of investment)

Interior pics to follow in a separate post but here are the exterior...

Before

After

[Jack Clough]

Thank you @Nghi Le , @Brian Garrett, @Rohith Janga, @Dustin Verley -  I found the deal through a wholesaler who was trying to sell the property for 180k originally. Nothing against wholesalers but this one was up to nothing good. 

So, I found a way to get in touch with the owner directly. I left him a voicemail and just told him honestly that I was here to help and offer advice. I let him know that I'm interested in a deal, but if a deal was not possible then I could at least offer advice for his situation. Three weeks went by and finally he called me back. We had a nice conversation and set up a meeting. We met for coffee and chatted about real estate, family, etc... Trust was established in both directions and we settled on a deal at 40k (the building was on the verge of being condemned and he could've ended up with nothing).

I honestly wanted to help the owner and by having that frame of mind while at the same time staying focused on my own goals I was able to get a deal. But it took a lot of patience and persistence (and shortly thereafter I found and closed on three more deals). The BP podcasts definitely helped me to visualize the kind of scenario that unfolded. So, mega thanks to BP for the podcasts.

Every day I have to tell my 10 yr old son to put his shoes on and he always says "I can't find them", but the fact is that he never looks. 

I believe that deals like this exist everywhere, in any market, and in any economy, but you will never find them unless you look. The searching is the education. At least it is for me...