Overland Park Triplex to Town home Conversion

[Sean Endecott]

Investment Info:

Small multi-family (2-4 units) commercial investment investment.

Purchase price: $515,000
Cash invested: $5,000
Sale price: $705,000

Acquired a Triplex in an excellent location in Overland Park, KS as a vacant rental property. Invested $5,000 with engineering firm to complete re-plat to market as individual market townhomes with a market value of $235,000 each. Cash down payment for acquisition was $125,000 and the property will cashflow until sold. Expected net proceeds will double the cash invested for a total of $250,000. Basically its a condo conversion, but also like a flip; it will be quickly turned for profit.

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

Very lucritive and making a comeback as affordable housing in Johnson County, KS has once again been in short supply.

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

I am always on the hunt for deals of all types because I have seen and done it all from Oil leases to construction. You name it. Auction purchases, foreclosures, shortsales, estates, court house steps. This seller was asking $550,000 and it was a non profit going under. The property was vacant at acquisition so it was bleeding cash. Thankfully lots of demand in the area had all 3 units rented in a month at market.

How did you finance this deal?

Conventional.

How did you add value to the deal?

I'm a real estate broker, contractor, and developer. 2nd generation builder. It's in my blood to find plan and execute deals.

What was the outcome?

Currently in process to sell as individual townhomes, but nearly flipped it to an investor at $675,000 in July.

Lessons learned? Challenges?

The investor market to buy as a traditional rental triplex topped out at $630000 to $650,000 on this, but we think we can do better selling as single-family townhomes.

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

Sean Endecott myself.