5 Unit Multifamily Bldg

[Nathan Adams]

Investment Info:

Large multi-family (5+ units) commercial investment investment in Great Falls.

Purchase price: $285,000
Cash invested: $50,000

Five Unit multifamily bought with seller financing. Even though it's commercial, since it was seller financing I negotiated a 30 year AM @ 4.35%. Solid, well kept building that I've been renovating each apartment as its turned over. Brought rents up $800/mo total in two years.

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

Seller financing was great. Liked 30 Year locked interest. Solid building, new roof and siding.

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

Found off market through friends. Negotiated directly with seller, closed with lawyers. Was simple.

How did you finance this deal?

Personal savings.

How did you add value to the deal?

Rents were $150-200 below market value. So I knew that going in.

What was the outcome?

Great, cash-flowing asset that I'm happy with and I spend almost no time/month on.

Lessons learned? Challenges?

Learned that I could have probably negotiated seller a little lower. Challenges have been that renovating as I go (upon turnovers) has eaten up most of the profits. It was my plan from the beginning, so I'm okay with it. It's nice to be able to spend 3-5K/unit on renovations and not be out of pocket at all. Learned the tax benefits of real estate are AWESOME!