10-Unit Multifamily Acquisition

[Brandon Sturgill]

Investment Info:

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

Purchase price: $260,000
Cash invested: $56,000

This is our latest acquisition of a C-class, 10-unit, 7,000+sq. ft. multifamily property. Current rents are well below market at $525...market is $650 or higher. We can drive the operating income from $63,000 annually to $78,000 annually...resulting in significant value add. ROI on this one is hard to believe...12 CAP, 2% rents-to-purchase, 25% Cash-on-Cash and an IRR hovering around 40%...

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

This is a typical C-Class value-add acquisition

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

Off-market opportunity from a private seller

How did you finance this deal?

Bank funded at 75% LTV.

How did you add value to the deal?

Renovating to force rents higher and diligent management to reduce operating expenses.

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

This was a private off-market transaction structured as a joint venture.

[Joseph Firmin]

Nicely done @Brandon Sturgill! We're in the middle of negotiating a 12-unit, similar strategies. Any key learnings?