First Flip- now on the market

[Adam Rabb]

Investment Info:

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

Purchase price: $445,000
Cash invested: $45,000
Sale price: $875,000

Bought for rental income, now for sale as the land is more valuable to a developer. This is due to school running out of housing. Over 50,000 NOI, but.. land is perfect for 100+ unit (.46 acre) can also increase NOI by increasing rent.

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

Myself and my family invested in this as we saw it as our first fix and hold. The plan was to hold for 2-3 years, then sell after we had properly increased rent price. Then use the money to develop two projects.

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

Found this deal while driving around the University. We decided we had to buy within 2 miles of the school. This place ended up being 1.6 miles away.

How did you finance this deal?

We financed through a bank.

How did you add value to the deal?

Made sure the last few units were renovated, also have started to increase rent prices.

What was the outcome?

Rent prices have been increased, non rent increased tenants have agreed to increase rent at the end of their one year contract. The place is now for sale with a healthy increase, as we expect a developer to want this for the land and area. It may also be purchased by an investor who wants to continue what we were doing. This place has high increasable value.

Lessons learned? Challenges?

So far- have learned the ins-outs of contracting. Working with family (this was a family project). Challenges have been finding the right price when a good can have incredibly different price points depending on what someone is pushing for.

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

Adam Rabb (this was myself) even though this was my first project I started (we purchased almost 6 months ago) I have assisted in finding, and executing several deals.