All Forum Posts by: James Tran

What is the maximum allowable rent on an affordable "low income" 1-bed unit in Los Angeles County? Trying to develop a proforma for a multi-family site.. 

@James Kojo -PM'ed you.

@Michael Hamby - Thanks Michael.  I would be willing to speak with him.

@Peter Lohmann- Will PM you.  

I'm looking for a good property management company to manage my 70-unit multifamily portfolio in Columbus, Ohio.  Its a Class C / Class D asset in the North Linden area.  Any recommendations would be appreciated!

Hi Chris,

To answer your question simply - Yes, underwrite the property's value as though there were no deferred maintenance, then subtract the estimate for deferred maintenance from that value.

James

High demand rental area with current GSI of $59,184 and lots of upside! This fourplex is located blocks away from Downtown San Pedro and minutes from the Ports of Los Angeles and Long Beach. There is a lot of investment and redevelopment occurring in the area-- most notable is the $100-million Ports O' Call redevelopment project in San Pedro located blocks away, which is anticipated to further increase renter demand.

All four units are occupied and consist of 2-bedrooms/1-bathroom. Three of the four units have been completely renovated with granite counter tops, new cabinets, and laminate flooring throughout. All units have interior washer/dryer hookups and there are 10 open tandem parking spaces in the rear parking lot.  

GSI- $59,184

NOI- $40,463

GRM- 13.5

ACTUAL CAP RATE - 5.06% (based on current rent)

PRO-FORMA CAP RATE - 5.74% (based on market rents)

I plan on attending

Hi Monica,

Welcome to Bigger Pockets! It is all relative. Whether a particular ROI is worth the investment will vary from investor to investor depending on what other alternatives investment vehicles are available, how management intensive the investment may be, and perceived risk.

11.9% ROI for a real estate investment (in general) is fairly decent considering stock market returns generally average 8% to 10%. Now if you're wondering if 11.9% is a good return relative to other multi-family properties, you should consider characteristics such as location (how likely is the property going to appreciate compared to your other alternative properties), tenant quality (are the tenants going to be troublesome or pay on time), how far is the property from you (I like to be able to drive by once in awhile), how marketable are the units for your area (general risk to your income stream, 3-bedrooms and 4-bedrooms generally take longer to fill compared to 2-bedrooms during turnover; hopefully you're in a family-oriented area), etc.

I hope this gives you a better idea of how to determine if the ROI is satisfactory enough to pull the trigger.

-James

Welcome Aaron!

Hi Jeff,

This will be my first BP meetup I'm attending.  Please put me down +1!

-James