84 Unit with value add components

[Steven Libman]

Investment Info:

Large multi-family (5+ units) commercial investment investment.

Purchase price: $3,175,000
Cash invested: $1,915,000

National Road is an 84-unit complex developed in 1963 and includes a simple mix of 79 one-bedroom apartments and 5 two-bedroom apartments.

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

28 down units makes for great immediate upside for renovation and market rents, while the other 56 units are below market rents by 25%.. There is an on-site office, which can be converted back into a two-unit, making the count 78 and 6. National Road offers affordable living with a home-style feel. The floorplans are all identical, and with tenants paying all utilities, are hassle-free and easy to maintain.

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

Broker

How did you finance this deal?

Bridge loan, 3 year IO to perm

How did you add value to the deal?

• Down Units – 28 Units
o $532,000.00
• Hallways and Stairwells
o $24,000.00
• Upgrade Existing Units – 56 Units
o $582,400.00
• Exterior Building
o $43,000.00
• General Property
o $55,700.00
Overall Budget $1,237,100.00

What was the outcome?

executing capex plan now

Lessons learned? Challenges?

We had owner financing in place for 850k. Last minute the bank would not allow subordinate financing, so we negotiated 850k as an LP position. Seller did not like this so pulled his 850k- we had to scramble to raise 850k in 3 days