All Forum Posts by: Ross Carlson

@Evan Polaski

Thanks for the reply Evan. I also was looking at it from a straight duplex play since the sale of the vacant land is unknown. I know this is an estate sale so that could be a reason why they aren't interested in selling the two properties separately.

It is a separate legal parcel zoned for mixed use Residential/Commercial B3 in Chicago

Zone size is 25x12. It does not have utilities running through it now and unknown on height restrictions but by the size of the property I am sure there are some. Realtor we are working with said the comps for the vacant land took 9-24 months to sell. This tells me demand is low for this type of property.

The commercial space is not rented which gives me some pause. Like you said, the space is limited so it would likely limit the amount of businesses that could come in. They had a potential tenant which was a mom/pop accounting business that didn't pan out. 

There is an above storage space that we were thinking of building out a staircase to which would increase the size of the space significantly. The commercial space was rented not too long ago so it is already outfitted with a wet bar, bathroom etc. so not much work is needed to the commercial space itself. I had not considered the 6% commission for leasing which is helpful. We would be able to spend $25k in renovating the space if needed. 

The rental units dont need much work after our inspection besides some new windows which we had estimated at $5k and a month's worth of vacancy. 

Hi Everyone,

Looking at purchasing my first property with my business partner. The property has a commercial space in front with 2 residential units located in the building.

Purchase price: $400k.

Residential Unit 1 rents for $1,250/mo. Tenant is already in place

Residential Unit 2 rents for $1,350/mo. Currently vacant

Commercial Unit Rent (comps in the area are going for $12-15 per sqft per year) approximately 500 square feet: ~$625/mo

Total Monthly rent is $3,225

The property also comes with a vacant lot that I would potentially sell off to help build reserves and fund the next property. Estimates for sale are $160k but could take some time to sell based on comps in the area.

Including property taxes, 10% Repairs, 10% Capex and 10% Vacancy, and utilities.

CoC return for this is only 4.1% which is obviously low but this doesn't factor in the potential sale of the vacant lot.

How would you look at this property especially considering it has the potential lot for sale?

Anything I should keep in mind with this being a mixed use property?

Thanks,

Ross

This was a great read, thanks for providing the in depth look at how you and your wife found success. Definitely inspired me to keep pushing towards my goals.

Hotel for me, consistency across the portfolio of brands is nice when choosing a place to stay. AirBnBs are better for larger groups. I think it also depends on where you are going City/Rural