Modern Condo Conversion

[Todd James Denman]

Investment Info:

Small multi-family (2-4 units) fix & flip investment in Somerville.

Purchase price: $629,000
Cash invested: $415,000
Sale price: $1,350,000

Bought a 2 family home and gut renovated it into two condos.

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

The average sale price of a multi family is much lower than a condo so I new there was tremendous upside if we renovated it and converted it to condos prior to selling it.

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

It was on the MLS.

How did you finance this deal?

Traditional financing for the purchase and private hard money for the construction costs.

How did you add value to the deal?

Totally renovating the 2 family home into two condos. Added living space in the basement for unit 1 and a roof deck for unit 2.

What was the outcome?

Sold both condos for over asking price in the first week on the market.

Lessons learned? Challenges?

Use larger construction crews to get the job done quicker and reduce carrying costs.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Yes. I am the real estate agent and we used James Hirbour from Jeanne D'Arc Credit Union for the mortgage and had a great experience.

[Marc V Palmeri]

Great job Todd.  I'm looking at a 4 unit off market deal in East Boston now that might make sense from a condo conversion perspective.  I've never done a deal like this before so I'm working through the numbers and logistics and learning as I go.  Definitely not easy.  I can only hope it works out as well for me as this deal did you for!  Congrats!