Pilsen 4 unit gut rehab

[James Scully]

Investment Info:

Small multi-family (2-4 units) commercial investment investment in Chicago.

Purchase price: $640,000

Gut rehab of 4 unit in Pilsen neighborhood of Chicago. Property was bank owned at the time of purchase. Purchase price was $275,000, and total cost basis after rehab was $640,000. With NOI of $53,000, effective cap rate is 8.3%.

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

Pilsen was on the cusp of exploding in value Spring 2016

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

I found it on MLS.

How did you finance this deal?

100% financed through a liquidity access line.

How did you add value to the deal?

Took vacant bank owned property with no working mechanicals, and turned it into 4 gorgeous modern apartments.

What was the outcome?

8.3% cap on total cost basis.

Lessons learned? Challenges?

In the city of Chicago, building and zoning code is God. Obey it.

[Ann Folan]

Love your lessons learned -- I try to tell people that all the time. They don't listen until they are up against it. Chicago Dept of Buildings and Zoning is its own animal.

Looks like a great project, congrats.