Investment Info:
Large multi-family (5+ units) buy & hold investment.
Purchase price: $605,000
Cash invested: $185,000
Beautiful brick building located seconds away from Bristol's charming downtown & across the street from Bristol Public Library. 8 studio/1 bedrooms and 2 commercial units. Property has been 90% stabilized.
What made you interested in investing in this type of deal?
I love construction. We have done several flips the last few years and it excites me to bring properties to life. This place was 40% occupied and needed a fair amount of work. We saw the potential of raising unit rents by average of $150 per month through renovations and raising the value of the building.
How did you find this deal and how did you negotiate it?
On Loopnet. We were working with a Realtor in the area already and had offered on the property before. When they finally lowered the price to $655k we were able to get them down to $605k. I coached the realtor on negotiating to get the deal done, as she was new and worked hard for us.
How did you finance this deal?
25% down through a commercial broker.
How did you add value to the deal?
We renovated 6 out of the 8 residential units raising the rent from an average of $675 to an average of $850 per unit. We will start working on common areas and such.
What was the outcome?
We will be doing a cash out refinance on this property soon. We are looking to repeat the process with more partners and a larger unit count.
Lessons learned? Challenges?
Contractors need to be vetted. We lost about $4k through a shady contractor. We'd also work with a different attorney.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Yes, definitely our Realtor.
