All Forum Posts by: Neil Henderson

The meet-up this Thursday will be a special one, Please join us at one of our conversion projects right here in downtown Wilmington. City Storage North is an old printing warehouse that was converted to a class-A climate-controlled storage facility.

We will be meeting on-site at 6 PM, doing a walk-through with the Acquisitions, Construction, and Management teams to discuss our strategy, and then moving across the street to Flytrap Brewery around 6:30 PM for networking for the rest of the evening. Hope you can join!

This Thursday is the Nomad Capital commercial real estate meet-up! Hope you can join us for free beer and networking, this month's speaker is Tim Vitale!

Tim is the founder of Upside Capital which is a multifamily and commercial real estate syndication company based out of Wilmington, NC. Tim has grown his portfolio $87M AUM with 757 doors plus three triple net locations including a warehouse and two restaurants. He quit his W2 job in September 2021 which he was the AVP of Finance for a Fortune 500 Insurance company and has used those skills and abilities to grow and scale as quickly as he has. Tim also has a mentorship and coaching program and a Facebook group with roughly 4,100 members called Makin Moves Real Estate Community.

Occasional speakers, no pitching, just lots of sharing of lessons learned, community, meeting fellow commercial real estate investors, and perhaps some good beer.

This is the monthly commercial real estate investing meet-up for the Wilmington North Carolina area. No speakers, no pitching, just lots of sharing of lessons learned, community, meeting fellow commercial real estate investors, and perhaps some good beer.

 Thanks Jonathan, I appreciate it! Yeah, the move served two purposes: 1. Get us closer to our self-storage partners 2. Change of scenery from the desert to the beach. All it needs to do is break even and that means we've taken some of our biggest life expenses off our books.

This is the monthly commercial real estate investing meet-up for the Wilmington North Carolina area. No speakers, no pitching, just lots of sharing of lessons learned, community, meeting fellow commercial real estate investors, and perhaps some good beer.

Investment Info:

Condo buy & hold investment.

Purchase price: $690,777
Cash invested: $220,000

Purchased this existing vacation rental fully furnished. Ran it as a 100% vacation rental through the Summer of 2021 before we moved into it as a house hack in October of 2021. It's one-half of a two-unit condo that was 5bd, 4ba. The bottom level had two bedrooms and one bathroom with a separate side entrance on the side of the property. We converted that bottom level into a 1bd, 1ba kitchenette that we rent out as a short-term rental. We live on the top two floors in a 3bd, 3ba area.

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

We had a great experience doing a short-term rental house hack of our home in Las Vegas, NV. We wanted to move to Carolina Beach, NC for a number of reasons, live across the street from the beach, and self-storage partners. The revenue from the short-term rental covers all our housing expenses, mortgage, taxes, insurance, utilities, and we get to live across the street from the beach.

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

It was an on-market deal that we used a local real estate agent to purchase and negotiate. The market was extremely hot so we just bid as high as we thought made sense.

How did you finance this deal?

Residential lender, 20% LTV.

How did you add value to the deal?

We converted the bottom level from a 2 bedroom, 1 bath to a 1 bedroom, 1 bath, kitchenette with a separate entrance, owner lock-out, and outdoor shower.

What was the outcome?

We began renting in early June of 2022. The short-term rental income has covered more than double the total expenses. Obviously, it's summertime, which is the high season, but we project its 12-month revenue should at least break even all of our housing expenses, and we are living across the street from the beach.

Lessons learned? Challenges?

Because the market was rising so fast, our appraisal came in low. Luckily we had a rockstar lender who was able to scramble to allow us to close without bringing too much more money to close. The renovation took about 3 times longer than we expected and ended up about $8,000 over budget. Finding good cleaners in a busy vacation market is a major challenge, as is dealing with linens.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Abby Harris of Nest Realty in Carolina Beach, NC.
Partick Stoy from MC Mortgage Group in Wilmington, NC

Investment Info:

Condo buy & hold investment.

Purchase price: $690,777
Cash invested: $220,000

Purchased this existing vacation rental fully furnished. Ran it as a 100% vacation rental through the Summer of 2021 before we moved into it as a house hack in October of 2021. It's one half of a two-unit condo that was 5 bedrooms, 4 bathrooms. The bottom level had two bedrooms and one bathroom with a separate side entrance on the side of the property. We converted that bottom level into a 1 bed, 1 bath kitchenette that we rent out as a short-term rental. We live on the top two floors in a 3 bed, 3 bath area. The revenue from the short-term rental covers all our housing expenses, mortgage, taxes, insurance, utilities, etc.

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

We had a great experience doing a short-term rental house hack of our home in Las Vegas, NV. We wanted to move to Carolina Beach, NC for a number of reasons, live across the street from the beach, and self-storage partners.

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

It was an on-market deal that we used a local real estate agent to purchase and negotiate. The market was extremely hot so we just bid as high as we thought made sense.

How did you finance this deal?

Residential lender, 20% LTV.

How did you add value to the deal?

We converted the bottom level from a 2 bedroom, 1 bath to a 1 bedroom, 1 bath, kitchenette with a separate entrance, owner lock-out, and outdoor shower.

What was the outcome?

We began renting in early June of 2022. The short-term rental income has covered more than double the total expenses. Obviously, it's summertime, which is the high season, but we project its 12-month revenue should at least break even all of our housing expenses, and we are living across the street from the beach.

Lessons learned? Challenges?

Because the market was rising so fast, our appraisal came in low. Luckily we had a rockstar lender who was able to scramble to allow us to close without bringing too much more money to close. The renovation took about 3 times longer than we expected and ended up about $8,000 over budget. Finding good cleaners in a busy vacation market is a major challenge, as is dealing with linens.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Abby Harris of Nest Realty in Carolina Beach, NC.
Partick Stoy from MC Mortgage Group in Wilmington, NC

Investment Info:

Other commercial investment investment.

Purchase price: $2,500,000
Cash invested: $1,350,000

Conversion of vacant 97,500 square foot Kmart to 65,000 square feet of climate-controlled self-storage

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

We love converting vacant big box retail stores into climate-controlled self-storage. There is an unmet demand for climate-controlled self-storage in the immediate area. Danville is a community that is just beginning what we believe to be a growth cycle.

How did you finance this deal?

Commercial lender plus private equity

How did you add value to the deal?

We are taking a building that has been vacant for years and converting it to over 65,000 square feet of climate-controlled self-storage in the middle of a busy retail corridor.

What was the outcome?

TBD. Construction just started. Slated to open Q1 2023.

Lessons learned? Challenges?

We bought the building with existing storage plans in place but our own architect did his own design giving us almost 8,000 square feet of additional space. The new plans required we go back through permitting. Danville permitting office is overwhelmed by the volume of new permits being requested in the community.

Investment Info:

Other commercial investment.

Purchase price: $1,500,000
Cash invested: $864,000

87,000 square foot vacant Kmart that is in the process of being converted to 60,000 square feet of drive-through, climate-controlled self-storage, yielding 500+ rentable units. Slated to open in September 2022. Purchased building for $1,500,000. Construction costs estimated to be $2,500,000. Total project cost $4,000,000.

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

We love converting vacant big box retail buildings to self-storage. There is a reason they built them there in the first place, and there is a reason they are prime locations for people to come back and store their stuff.

How did you finance this deal?

Commercial lender and private equity

How did you add value to the deal?

Turning a vacant building into self-storage

What was the outcome?

TBD. Construction is nearly finished. Due to open in September of 2022.

Lessons learned? Challenges?

Supply chain issues across multiple industries are not to be discounted. Supply chain delays of small parts delayed our final inspection by at least one month.