I have a worn 6-plex under contract that is next to a lot where 14 new townhomes are being built. Next to that is a lot with 20 townhomes that are probably 25 years old.

The lot the six plex sits on is the same size as the the 14 units under construction, each 19,000 sq ft. All my buyers are residential landlords and wouldn't be able to look past the current use of the property and wouldn't see any value beyond the cash flows of the six units. Rents are sky-high and seemingly ever-increasing currently as is widely known.

The deal as a straight six units is good, but not great. The lot is zoned to allow three stories high construction, as is being built next door. How can I show that there is value beyond the value of the current cash flows, as buyers wont acknowledge it has any greater value unless I can show them. This property was formerly a 6,000 ft single family that was legally divided into 6 apartments, each with exterior access.

Unfortunately, the lot next door didn't sell at a price that was attractive on its own relative to the price of this operating property so the lot value alone isn't a convincing figure. 

I can see buyers complaining that the deal isn't good enough, while knowing the future value isn't quantifiable right now, but will be happy to put that value "in the back-pocket" for the future.

How can I present this deal in a better light that gives it additional value for how properties are being developed in the immediate vicinity? As a wholesaler I find sometimes the biggest issue is identifying the value of a higher and better use and convincing buyers. I seem to have had good luck at this in dividing duplexes, etc into individual townhomes, but these units are also vertically stacked so don't qualify as townhomes and would have to be done as condos, which is a much more demanding and costly process.

I try not to give away identifiable value, but haven't been able to quantify any identifiable value other than to simply say a developer will likely want to buy this and scrape it someday - but that doesn't translate to current value for my residential landlord buyers as their formulas are steadfast.