Revitalized Historic Community in the Northeast of KC

[Nate Morris]

Investment Info:

Large multi-family (5+ units) commercial investment investment in Kansas City.

Purchase price: $755,000

David and Alice Smart's Historic "Additions" is two buildings totaling 28 rooms in the Northeast KC community situated between KC Med/Biosciences and the Hardesty Renaissance. Full renovation top to bottom including premium sub-terrain units, laundry and manicured gardens. This is an Opportunity Zone investment. Amazing community near parks, open green space, beautiful tree-lined boulevards, local shops and more!!

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

We have been looking for a Historic renovation project in order to provide clean, safe and affordable housing to help revitalize the local community. These buildings offer the charm of old KC on wide tree-lined street near scenic drive open space parks. Each unit came with an open air balcony, larger interiors and the gardens.

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

The deal was listed under contract in Loopnet, when we met the Clemons Group agent Richard Redding. Richard helped us search for similar listings on and off market. When this property fell out of contract we were positioned well with financing and an offer. The negotiations were smooth including a 45 day close, minor retrades for electrical and plumbing. We are happy to have worked with the seller and the Clemons Realty Group.

How did you finance this deal?

This project is financed through ANB bank with a construction loan.

How did you add value to the deal?

We are continuing to add value to the property including full unit renovations, brining 6 out-of-service units back to service, and converting one common/laundry room into +1 additional unit.

What was the outcome?

The response from current and new tenants has been very positive.

Lessons learned? Challenges?

Renovations in occupied buildings is challenging. We are grateful for our understanding tenants and partners. The importance of properly scoping, budgeting and contingency is extremely important. Finally, underwriting must always include an ongoing reserve as well as quote supported expenses such insurance, snow removal, water and utilities

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

I would recommend Richard Redding of Clemons Real Estate and Brian Roby of ANB Bank.