All Forum Posts by: Jeffrey D. Kent

Mike - Thanks for the heads up, but it is one of my goals to go into worker-class neighborhoods, rehab properties, and still rent them at an accessible price point, all while making a good return. Slowly helping make positive changes.

Investment Info:

Large multi-family (5+ units) buy & hold investment in Topeka.

Purchase price: $900,000
Cash invested: $300,000

A 49-unit apartment complex in a working class neighborhood with huge value add potential in rehab and rent.

What made you interested in investing in this type of deal?

This complex was going to make a great Cash on Cash return of nearly 20% from close, and shows huge potential to bring greater returns after we complete rehab.

How did you find this deal and how did you negotiate it?

We were able to purchase the property for significantly less than the asking price, which gave us an immediate and significant positive cashflow from closing of escrow.

How did you finance this deal?

Hawthorne Bank, which specializes in lending in the area, has been exceptional to work with. We were able to fin cane the property and include the costs of rehab int he loan!

How did you add value to the deal?

This property was at 85% occupancy, but was not being properly maintained or managed. The property is currently being rehabbed at a rate of 5 units at a time. The units are being gutted, and completely rehabbed. Additional value adds will be by rehabbing the laundry room, offering vending machines for supplies and snacks, and trading an onsite management office to the property management company in exchange for a reduced management fee.

What was the outcome?

The property closed without issue and is currently cash flowing. The rehab process is currently ongoing.

Lessons learned? Challenges?

Take your time to find the right property, lender and partners, and wonderful things will begin to happen!

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $65,000
Cash invested: $13,000

1409 King will always have a special place, as this was our first investment property! This is a single-family home in a working class area that has been rehabbed inside and out to offer our tenants an excellent property at a reasonable price.

What made you interested in investing in this type of deal?

Jumping into the investment market can be scary, a nd investing out of state even scarier! Living in Southern California, the idea of purchasing a property with 20% down and being able to rent it out to cover the mortgage is next to impossible. However, when one looks out of state, these impossibilities are everywhere. Not only are we covering the mortgage, but making a 12.5% COC return!

How did you find this deal and how did you negotiate it?

After scouring the internet, listening to podcasts, and watching webinars, I met Terrence Burner with Invictus Real Estate Group out of Indianapolis, Indiana.

How did you finance this deal?

This property was financed traditionally through USBank with 20% down.

How did you add value to the deal?

Since this was my very first deal, I sought out a turn-key rental. Therefore, no additional value was added to this property.

What was the outcome?

The outcome has been wonderful. The property has a tenant on a 2 year lease, who has made all rent payments thus far timely!

Lessons learned? Challenges?

The biggest challenge is to stop thinking about it and, as Nike says, "Just Do It!" Of course, do your due diligence, but get off the sideline and into the game.