Financing Question – 7-Unit (4-plex + 3-plex) in Baldwin City, KS

[Maddy Morell]

I’m working with Invecstors who want to sell a 4-plex and 3-plex together on neighboring parcels in Baldwin City, Kansas.

Total 7 units, being offered as one package.

Would this be better financed with a commercial loan, or with two conventional loans (one for each parcel)? 

Curious what lenders here have seen work best and why.

Also, does anyone here actively lend on this type of property in Baldwin City, KS?

Thanks in advance for any insight!

-- Maddy

Licensed Agent, KS & MO | The Bridge Team / 1st Class Real Estate KC

[Maddy Morell]

@Nate Herndon -- 

Thanks for breaking that down — very helpful.

We've got the 3-plex + 4-plex package priced at $725k. Current NOI is around $29k, with projected/stabilized NOI closer to $53k once fully leased and with a couple units finishing renovation. 4/7 leases were just renewed close to market rent, but not as high as are updated units are projected. 3 vacant, 1 just renovated now being marketed for rent and should be occupied prior to closing. 2 will likely be renovated prior to close, but not sure they will be occupied w/ rents in place prior to closing.

Would this type of situation still qualify for two separate DSCR loans (one for each parcel), or would the combination of rehabbed units and slightly under-market leases in place on 3 units make approval more difficult?

And more generally — is there a max purchase price or loan size that DSCR programs will allow on 2–4 unit properties?