Investment Info:
Small multi-family (2-4 units) other investment in Philadelphia.
Purchase price: $110,000
Cash invested: $30,000
Sale price: $230,000
Dilapidated garage covering two single family zoned lots, oddly shaped lots. Combined both lots into two lots with city and zoned for 3 unit multifamily project with 1 off street parking. One unit was two story 2bd 2ba with private rear yard access, and two 1bd 1ba units. I was originally going to build and hold this project. Sold shovel ready project with full set of plans, engineered drawings, mechanical, structural, geotech, etc.
What made you interested in investing in this type of deal?
Deal was off-market from known wholesaler who owned the property. Was unable to sell for over a year. Kept making offers. I knew the neighborhood, went to the zoning meetings often and was confident I could get multi-family approved.
How did you find this deal and how did you negotiate it?
From Wholesaler who was owner who I dealt with previously. Property was sitting kept making offers.
How did you finance this deal?
Cash
How did you add value to the deal?
Rezoning, reallocate lot lines, full plans that had city building permits approved. A true Shovel Ready Project".
What was the outcome?
Property was already a great deal and then Opportunity Zone designation made it even better. Sold for profit
Lessons learned? Challenges?
Because I originally planned on developing I overspent on drawings. Probably could of gotten sold for same price without full set of plans. First time I ever had a transaction fall through and was able to keep the security deposit. Honestly felt bad doing it but the money was mine. Shared a slice with the agent. Always make sure your agreements with agents address this scenario. Agent first told me he always takes 50% but he forget to have me sign. Fortunately I always look for this and knew.
