Progress Report - 21 Unit Value Add

[Chris Gantz]

Investment Info:

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

Purchase price: $785,000
Cash invested: $300,000

Older Value Add Multifamily. We have been renovating the units on turnovers and increasing rents by about 50%. Common areas are being updated as well.

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

Strong value add opportunities, high return potential.

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

On market listing.

How did you finance this deal?

Conventional loan, 20% down.

How did you add value to the deal?

Updated common area lighting from florescent to wafer LED lights. Painted all common areas, updated all common lighting. Updating all flooring in all units, replaced old, inefficient windows and patio doors. Updating cabinets, lights, and baths in units.

What was the outcome?

We have realized up to 60% increases per unit rents. We expect to stabilize the building with around a 60-70% gross increase by the time the project is complete.

Lessons learned? Challenges?

Challenges working with existing tenants paying lower rents. Increase rents on existing tenants.

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

We do all renovations in house other than flooring with the Flooring Center out of Baraboo.