4-Plex BRRRR Property in Kettering, OH - First Deal!

[Anthony Mirabile]

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Kettering.

Purchase price: $220,000
Cash invested: $70,000

Kettering 4plex fully occupied at purchase (turnover since then due to month leases), 2/4 units recently renovated, plans to reno other 2 upon lease expiration.
Previous property mgmt neglectful w/ much room for improvement to mutual benefit of tenants & owners. All 4 units leasing under market rents ~10-20% on average. Additional reno rent increases ~20-30% on those 2 units for a cash-on-cash ROI of 18% for the reno.
Expecting forced appreciation from NOI increase and reno work of $60-90,000.

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

Spending hours and hours of commute time listening to Brandon and David rave about the BRRRR strategy on the BP Podcast!
The ability to quickly get capital back out of a deal to use on future deals seems like a no-brainer, especially while the property is cash flowing at the same time!
This particular property seemed to be a great BRRRR opportunity given the below-market rents and reno potential.

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

Working with an outstanding agent referred by a fellow BP-listener and Air Force friend as well as combing Redfin and other listing sites.

How did you finance this deal?

Personal savings.

How did you add value to the deal?

By taking on problems other people weren't willing to address!
Value-add for this property is currently ongoing and still in the early stages, but the biggest factors are the reno of the EXTREMELY outdated and dilapidated bottom two units as well as simply improving the quality of life for the tenants through better property management and property upkeep.

What was the outcome?

The most tangible outcome currently is the HUGE amount of lessons learned and experienced gained by actually through the investment-property buying process for the first time!
Ultimately, in true BRRRR fashion, looking to refinance to get capital back out for future deals while maintaining a great cash flowing property to build the portfolio.

Lessons learned? Challenges?

Way more than are allowed by this character-limit...but it was a rollercoaster for sure, and no shortage of good stories, especially for a first deal! Crazy!

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

Casey Hartman (Glasshouse Realty, Dayton, OH) is our agent and she is INCREDIBLE - a true professional, great at her job, and a delight to work with. She absolutely understands the investor needs and mindset - already navigating a deal #2 with her!
Paul Sushereba (NFM Lending, Beavercreek, OH) is an outstanding lender who possesses a truly impressive knowledge of the lending/mortgage process and is also very investor-savvy.
Both of these rockstars worked tirelessly with us to close this deal.

[Dave DeMarinis]

Congratulations Anthony on starting your journey. What are the rents and unit configurations? I think you should look very closely at your numbers. A 4 unit is generally going to appraise off comps, not NOI unfortunately. I just want to make sure you don't end up over market with purchase price plus renovation (that is a heavy renovation budget). DM if you want to talk more details.