Great acquisition !!

[Francois Frigon]

Investment Info:

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

Purchase price: $475,000
Cash invested: $100,000

Great investment property. Bought for $475k and the property got appraised at $575k (awesome!)
Avg rent is $1350 in that area
NOI is $47k yr with a cap rate 6.4% bringing the value of this property at over $630k.

This was my best acquisition so far through my LLC

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

Investing in new construction multi-family property in the San Antonio area was our strategy since 2016.
We acquired 3 properties so far with good to excellent return. So our strategy was a good one I believe.

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

We looked at new construction projects in the area and found multiple back in 2016.
We decided to go with Vistancia Custom Homes for the Triplex, JAP for the Duplex, and SAMA for the Quadruplex located in Selma.

Though all 3 were Ok, the best construction experience with the less issues was with SAMA.

How did you finance this deal?

Most of the money came from personal contributions to the LLC from both my wife and I
I'm a full time IT employee at a major oil company. This full time job is allowing me to invest in the LLC on a yearly basis.

How did you add value to the deal?

Signed all 3 contracts back in 2016 at a fix price.
Once the properties were built 3 years later, they already had considerable appreciation (so this was a good strategy for us)

What was the outcome?

avg ROI is over 10% - so to us that is excellent result

Lessons learned? Challenges?

Working full time, and managing 9 doors makes life exciting.

The challenge will be how to growth through more acquisition without the need to hire a property manager, and keeping my job... we shall see.

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

Jimmy Palacio was my broker in San Antonio. All 3 contracts came from him. He is very professional, knows the multi-family business in the area, and guided me well through these purchases.

[Francois Frigon]

Thanks all for the good words.

Collin, the quad is located in Selma Texas (16921 Showdown Path)

Andrew, I paid $5k down pay back in 2016 to secure this deal with the builder SAMA.  This down pay got factored in at closing.  About the returns, well it happen 1st month.  I rented all the units over 2 nights (it was crazy, I even had to increase one of my rental)...  Not sure if it was luck, but all 4 tenants moved-in a few days after closing.

I don't plan to refi anytime soon (working now to improve my debt ratio).  I positive cash flow over $2k per month with my 3 properties which is good for me at this time.  

Next deal could perhaps be a small commercial office building in the markets I'm currently in (new construction of course).  We'll see.