All Forum Posts by: Jason Newberg

Hi BP

Question for the community that dabbles in the HOA and title realms. In 2019, we closed on 15 townhomes in a 16-unit community - the community consists of four buildings with four units each. The properties are individually titled, and fall under an HOA that was established twenty years ago.

In 2021, we plan to purchase the 16th unit from the owner, at which point we'd like to abolish the HOA and convert the townhomes back into apartments. The reason for this is two-fold.

1) banks don't like that we have a controlling interest in the HOA as a majority owner, so selling the townhomes off one by one would require buyers to use non-conventional lending. This drastically shrinks our buyer pool.

2) big “if” here, but if we could retitle these as fourplexes, we could seek conventional financing (vs the commercial loan we currently have) and increase our cash flow substantially through lower rates and a 30-year am.

Have any of you dealt with something similar? Curious to know if there are any attorneys reading that have some thoughts on how best to accomplish this.

Thank you!

JN 

Wow, that’s quite a transformation! Thank you for sharing. @John Casmon, you’re absolutely right! We could have definitely been more prepared in terms of having a business plan done prior to writing an offer. Since the building is fully occupied, we felt like there was less urgency on interior upgrade planning, but we certainly didn’t brainstorm too much about the exterior/curb appeal, so this thread has been enlightening.

BP amigos, thanks a ton for the suggestions. Some I expected and some really surprised me. Will definitely do some undercover work on the competition and see what they’re doing that (presumably) is working. In the words of a wise person, going to Drive this property like a Honda :)

What’s up BP Family? Getting ready to close on a 12-unit building in South Carolina - Stoked! All units are 2bd/2ba townhome style units with W/D hookups and 1200sqft of living space. Kitchen finishes look straight out of the 80’s and the bathrooms don’t look much newer, but everything is in good (albeit dated) condition. With this in mind, our team will be putting capital against value-add opportunities. My question:

What are the best value-add opportunities to go after first? More specifically, for those of you in the apartment building game, would you mind sharing your value-add upgrades/improvements and the ROI you estimate you have returned on each item or group of items (I understand that, for example, it's hard to estimate the ROI on a kitchen reno if you also added a pool and play ground to the complex at the same time).

Things we’re considering:

- Paint kitchen cabinets white, butcher block counter tops, and tile backsplash

- Vinyl plank flooring on the main floor instead of carpet and 12” tile.

- New (SS) appliances
- Supplying W/D

- Clearing grass/weed/shrubs around part of one building for sitting/common area.

This is a (low) B class building, and again only 12 units, so it wouldn’t make sense to go crazy on the common areas, but I’m very curious to hear what others have had success (or not!) with?

Cheers!

Jeff,

Wondering how your  experience with Indianapolis has been going? I see from another post that you had an offer in on a place -  was it accepted?  I’m interested in diving in the Indianapolis market as well so would be curious to hear about your experience.

Thanks!

Jason

Hey Guys and Gals

My name is Jason, and I just joined BP today - what a wealth of information! I'm in the Northern Virginia area now, but my wife and I would like to buy a vacation home in Southern California. Is it possible to purchase a fourplex (keep one unit vacant as our vacation spot) and finance it as a second/vacation home? Thanks in advance!

Jason