All Forum Posts by: Arifa Khandwalla

Thank you to  all of you that posted. So here is the story: I put the building on the market and I was not getting the numbers I needed to justify the sale after commissions etc. While the building was on the market, my reading of the situation in Lawrenceville changed. I went through a dry period when it was difficult to rent apts and we were not getting too many inquires (while my taxes tripled). However, in the past 6 months or so, its became easier to rent and the rents have increased. Also, a transition from new apt building development to new office development reduced my anxiety about  vacancies. Most importantly, these new speculative office buildings are being leased. 

So I took the property off the market for now. 

Sounds to me that the prospective tenant is playing hardball. He/she knows that having a pitbull will make it harder to rent an apartment. Or the tenant has already been rejected many times and has decided to go in guns blazing hoping that the he/she can scare an owner into renting to them. My guess is that he/she is bluffing and is hoping you won't call the bluff. 

It could be simply that the property manager is mediocre and doesn't want to deal with a difficult prospective.

@Jim K., 

What are you thinking about population flows  ? Where do you think are the next new Lawrencevilles?  What about Bloomfield ? 

This is a link to an aging survey. Apparently, a larger and larger percentage of people will age going into 2050. So, we have a while to go and thats why the hospitals are expanding. 

https://ucsur.pitt.edu/state_of_aging_2014.php

@Samuel Vogt, wow! thats interesting. We have to rent out the units during April - Aug otherwise its hard. During 2016, we substantially increased our rent. Maybe it was the location in Lawrenceville ?. Our apartments rent from 850-1200. 4/6 of our tenants just renewed their lease. We are still trying to figure out the repairs. Its brickwork etc. 

@Anthony Angotti and @Phil Anderson and @Jim K. I understand what you are saying. But at the same time I feel we have a "trophy" location with possibilities that depend on how well the tech sector does. If things continue as now, we will make 8-10% per year net which is not great.. Sounds like the thing to do is to put it on the market and see if we get a premium for it. But the thing that nags me is, that we might be selling a property with potential. Its about 5700 square feet with 3 floors.

 It took longer this time to rent than it normally does (a month instead of 2 weeks). What I noticed was that renters became more interested after the new development tiny upscale studios with amenities (similar rent about $1065, but tiny) were all rented. The more expensive 1 beds (1600 >) and 2 beds (2300>) are still available. Virtually everyone who came to see the apartments were moving to the area for the first time. I just got a call from Berkeley, California from a prospective renter. All of them are twenty/early thirty somethings. No one ever pays late. Many of the younger workers are priced out of California and New York and they are looking for a better lifestyle. 

So, nowadays young people want urban chic, affordability, walkability and transit. So if the tech sector grows and more people move here, I think Lawrenceville, Strip District and Oakland is where the action is. Robotics and AI is the next wave of the tech boom happening and CMU is one of the centers.  There will be dips but I am certain that these industries are the future. The problem I think is there is not enough VC money coming to Pittsburgh to take companies to the next stage. So the question, will Pittsburgh get to the next stage of growth ?  I know there was a mass exodus from Allegheny County when they raised taxes to other counties but that was a different demographic. 

Although I lived in Pittsburgh and my husband is from there, our experience is in NYC where we have seen neighborhoods "gentrify" and remain like that and areas further away become also become more expensive. But I suppose, NYC is growing...  

@Alex Deacon Thats quite helpful. In general, what is the upside in Pittsburgh if population growth is expected to be stagnant ?

Me too! 

I own small commercial multifamily B class property that is being surrounded by newly built rental apartments in Lawrenceville in a prime location.  I am trying to decide whether to sell or hold on. We bought it 2 years ago and turned the building around but the building needs 50-75k to deal with deferred maintenance issues. All our renters are young professionals employed either in tech or in UPitt or UPMC. Hundreds of new upscale units have come on the marker specifically the Arsenal. Its getting harder to rent and they are giving away 1 months free rent etc. Our taxes are being appealed by the school board and will most certainly go up. If we sell, we will at best make a nominal profit so the purpose of selling is not to make a profit but to reduce risk   and the headache of maintaining a long-distance property (I am out of state).

What is the upside in Pittsburgh ? Will rents increase with time or stay stagnant or lower ?The question is will employment continue to increase and absorb the new apartments. This area is driven by tech but there are no headquarters in Pittsburgh for medium sized tech companies.  I am concerned that population decreases in Pittsburgh have not halted. The medical industry continues to increase in Pittsburgh, but their patients are not increasing. In fact as the older population passes away what happen to these jobs ?

Thanks Alex and Stephen. I will pm you Stephen. 

Hi, 

We are out of town landlords for a 6 one beds building in Lawrenceville. Its about 6000 square feet in size. We are struggling with finding a reliable super for the building. Its easy to rent out the apartments due to the fantastic location but the building has deferred structural maintenance from the previous buyers. Rent collection is about 5700 a month. These are the tasks that we are looking to get done. 

 - removing trash and regular upkeep of the building

- basic handyman skills and customer service (responsible for outsourcing more complex repairs)

- dealing with contractors and giving access to the building or apartments (roofer, brick repair, painter for fascia and fire escape)
- preparation and apartment showings for new tenants
- major repairs such as painting an apartment to make it tenant ready will be extra compensation. 

Currently, our model is to give a low base salary per month. We pay additional each time a lease is renewed or a new tenant moves. We also pay additional compensation for major jobs such as painting etc. 

Our estimate of time required is about 5 hours a week. Two -three hours a week for trash and cleaning the common areas and the outside areas. The rest of the time is for letting in contractors and for the occasional tenant call. 

My question is what should be the base salary ? Is my estimate for time needed accurate? If you have any leads for a super please reach out to me. 

Thank you for your help.