Dodge St. Duplex Domination

[Owen Dashner]

Investment Info:

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

Purchase price: $245,000
Cash invested: $55,000

This is a duplex on 51st & Dodge St. in Omaha, right in the heart of Dundee. Other than being located on a busy street, this is about as prime of a location as you can get. The units are huge:- 3 beds, 2 baths and over 2000 sft on each side. One side was vacant and needed a lot of work, the other side was dated and under-rented at $1200.

This was a BRRRR deal. We refinanced and got all of our money out plus extra. The remodeled unit is now rented for $2120 per month.

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

BRRRR's are one of my favorite strategies to build wealth. None of my own money in the deal, cashflow and appreciation.

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

It was a pocket listing that a broker brought to us.

How did you finance this deal?

It was purchased using a line of credit, then rolled off of the LOC after refinancing at a different bank.

How did you add value to the deal?

We replaced furnaces, gutted the kitchen, full repaint throughout the interior and refinished the hardwood floors.

What was the outcome?

We refinanced at 85% LTV on a $400K appraisal, so leaving a $340K note at 5% interest and a 20 year amortization. We are going to use the extra $40K from the refi to remodel the other unit once the lease is up.

Lessons learned? Challenges?

This was a little challenging because of Covid-19. Most appraisals ground to a halt, so it was difficult for us to get the appraisal turned around quickly, but it got done within a month. We were concerned the pandemic was going to negatively affect the valuation, but it came in right where we were hoping.

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

Amanda Zahm with PJ Morgan on the buy side. Kate McGann at Malvern Bank on the refinance. Melissa Sloboth at Missouri River Title on the closing.