All Forum Posts by: Rob Riggins

Can anyone recommend a good structural engineer in St. Louis? I have a 2-family with sagging main beam and we need some guidance. Thanks for any recommendations!

-Rob

@Michael D. interresting concept, thank you!

@Jason Dillard @Michael D.The seller has too many properties that need rehab, so is selling this building to get cash to rehab other properties he owns. How would you recommend structuring a partnership in this scenario? If I bought in at $50k or $100k would I be a 50/50 partner? More? Less? Appreciate your responses. 

@Patrick Liska thanks for the advice. @Jason Dillard I didn't even think to ask that question about existing debt. What might I be looking to do based on the answer to debt?

I’m looking at an off-market 12-unit apartment complex in a C+ or B- area in Saint Louis and have two questions:

1.What is a valid purchase price based on the property fundamentals?

2.I have a bit over $100k to invest so purchasing the property outright would make rehab/repairs doable from cashflow, but challenging. If I were to partner with the current owner by providing funds for rehab what would an equitable partnership look like?

About half of the units could use updating. Probably $75-100k in work would need to be done over the next 1-5 years, ranging from kitchens, to electrical to new windows. Current owner selling to take out his equity and focus on his other properties, as he doesn’t have the cash to upgrade the units.

Asking Price: $525k

Rent Roll: ~$83k

Vacancy: 11 of 12 units currently occupied.

Property Management: Professionally managed $5,340 annually

RE Taxes: $4,608/yr

Insurance: $2,800/yr

Water/Sewer: $2,796/yr

Heat (Gas): $7,657k/yr hot water furnished to all units, heat furnished to 9 units

Repairs & Maintenance: $8,136/yr (my estimate)

Capex: $8,136/yr (my estimate)

Total OPEX: ~$39,500/yr (~48% of Gross Rent)

NOI: $43,500 8.5% cap rate

Financing: TBD. Struggling with this as the loan amount is small for a multifamily.

Misc: On-site caretaker lives in basement room (not included in 12 units), cleans hallways, mows yard and does snow removal. Parking is on-street, but plentiful. 

Any and all thoughts or comments appreciated. Thanks!

@Jake Kellerhals I like your logic. I plan on our both being on the mortgage so I can easily refi her off (or her me) at some point in the future if we choose to do so. Thanks!

@Michael Barbari  thanks for your guidance and thanks for schooling me in the ways of using the forums properly!

Thanks Michael! Yes I can qualify but the purpose is to be able to buy a 4-unit with 3.5% down as it will be owner occupied by the partner...who is my niece. Does that mean she should therefore own 20%? Get a reduction on her rent? I can't figure out what is fair. 

I want to partner with someone I know on a 4-family purchase. They would be on the mortgage to provide owner occupancy for FHA. I will provide all cash for down payment / closing costs / upgrades / ongoing maintenance / etc. I would also utilize this individual as an on-site manager.

What is an equitable ownership split? Should they benefit from the positive cashflow? Get reduced rent? 

I'm not sure what is fair so would appreciate any real-world experience or thoughts that folks may provide. Thanks!