Mix Use Property Investments Purchase

[Jason Janosko]

Investment Info:

Other buy & hold investment in North Branford.

Purchase price: $265,000
Cash invested: $66,250

Mix use property with 1 - 3 bedroom apartment, 1- 1 bedroom apartment and 1- Commercial space (Liquor Store)

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

Cash Flow

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

Found the deal through a friend who's father owned the property. The property was not listed for sale but the father was looking to sell it. I found out what he wanted for the property and then did my homework. I found comparables and the price I needed the property to be to make money. I negotiated pretty easily with the owner as he wanted about where I thought the property should be. There was a little back and forth but nothing exciting.

How did you finance this deal?

Traditional financing through a small bank. It was a commercial loan and the small bank offered the best options.

How did you add value to the deal?

During the inspection process I had asked for a credit due to some needed repairs.

What was the outcome?

The previous owner did not do much work to the property so as I have built up some equity I had remodeled one of the apartments. I also repaired some minor things to the property and plan to do at least 1 upgrade a year, even if it is small. I have also tried to keep a civil relationship with the tenants and whenever I see them I try to communicate with them. Overall this has worked out well. The communication and upgrades work well to keep the tenants happy even though I have raised rent.

Lessons learned? Challenges?

Don't underestimate the general repairs. I felt I prepared well and created enough of a buffer to cover repairs but it was very tempting to cut some of the repair costs. If I did not stay disciplined with my repair budget then I might have been disappointed as I would have had to dip into my cash flow. If you plan to have a high repair budget and can live with the cash flow while doing that then you will never have to worry about sudden repair expenses.

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

I would recommend myself as an agent!