Building a multi family empire

[Seth Hobbs]

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Danville.

Purchase price: $152,000
Cash invested: $50,000

This was a 3 unit that we turned into a 4 unit that is in one of the nicest parts of town and draws really nice rents. Rehab was roughly 40,000 which we then refinanced out and the property is currently worth 215,000

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

It was in a great part of town and was originally going to be a house hack, but decided to add another unit and go for the cash flow. It doesn't have the best cash flow but it is a good asset that really strengthens our portfolio because of its value.

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

A real estate agent brought it to me off market.

How did you finance this deal?

Conventional commercial financing

How did you add value to the deal?

We turned the 3 unit into a 4 adding more cash flow and value.

What was the outcome?

Its a very stable asset with long term tenants in it because of its seclusion and location.

Lessons learned? Challenges?

Get contracts with contractors! We spent way too much on the renovation, it being one of our first investments dealing with outside contractors. They took forever to do the job and way over budget.

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

We bought it with a realtor and we currently have a great property management company in place.