Small apartment purchase in NoPo

[Julee Felsman]

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $375,000
Cash invested: $100,000

5 plex purchase near the Bridge in St Johns.

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

At the time, 5-20 unit buildings were an overlooked and undervalued niche.

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

The property was advertised by the owner on Craiglist... although he also had a realtor representing him.

How did you finance this deal?

Commercial loan with 25% down.

How did you add value to the deal?

The property had what we originally thought was water damage in one unit (turned out it was carpenter ants). We fixed that immediately and have done cosmetic upgrades to 3 of the 5 units. We've also repaired rotten balconies, replaced the roof (twice) (pro-tip: pay attention to proper ventilation of a flat roof).

Lessons learned? Challenges?

This is almost our newest building (built in the 60s)... this vintage of building was not built as well as some of our older properties. Or maybe it's more accurate to say it was built with materials that were not as forgiving. It cash flows well, but it's been a non-stop race to keep up with/correct various issues due to the vintage and style of construction.