Looking for some insights into what all that would entail, its currently run as a motel (21 doors) but would make a potentially great multi-family property. I know zoning would play a part, looking for someone whos done it or what else i should think of when planning this project.
I've always wondered this. I'd love to hear what others have to say.
@Jeremy Hunsberger I've only been on the other side of the fence, meaning looking at buying a motel that was converted to a commercial multifamily property. The couple of times that I did look at them (it's fairly rare) I've always come away less than enamored. It still really looks like a model from the street and you end up with these odd studio apartments with (essentially) kitchenettes. Consequently, the couple that I looked at really did appear to have the "bottom of the barrell" tenants. That's just not my cup of tea. In fairness, these two properties weren't exactly in high-density metro areas so you might (in limited cases) be able to appeal to younger professionals. I'm not really not sure on that one. I don't know the first thing about Strasburg, Pennsylvania but I think if I were in the planning stages I'd try to get a list of studio apartments that were (locally) available to rent and see the condition of them, tenant quality, etc. I know this isn't a direct answer but "from the other side of the fence" these haven't looked great to me.
whats the per unit asking price? That would be the big factor in my mind.
I have looked at these before. I agree with @Andrew Johnson . I own a building that has several 2 bedroom/1 bath apartments and then 2 very small 1 bedroom/1 bath apartments. The small units are typically hardest to rent. The typical tenant I have found for those units is in a stage of life transition (divorcing, moving out of parents, etc). Usually once they 'land' on their feet they move quickly into something larger. I think that the difficulty to rent and keep rented these units it would be complicated by the fact that with the typical hotel room layout (bathroom by the door and 'bedroom' beyond) the most logical place for the kitchen or more than likely 'kitchenette' is in the bedroom area. Based on my experiences with the 1bed/1bath's that I currently own and the difficulty that I have getting them rented and keeping them rented I would pull my hair out trying to find 25 to 50 of these typically transient tenants. So I switched how I was analyzing these properties. I began analyzing them as 2 bedroom/1bath units. With a more expensive remodel I could merge 2 hotel rooms into 1 by removing a bath and since the plumbing is there already I could place the kitchen there. By putting a cased opening in the wall between the units I could create a hallway and a few more non-load bearing walls and I could create 2 separate bedrooms. Close off the motel room door nearest to the bathroom that will not be removed and you have a pretty decent 2 bedroom apartment. This solved my layout problems but gave me two other problems. 1) Remodeling costs skyrocketed on me. 2) Now I went from 50 - 1 bedrooms renting for $600 each per month to 25 - 2 bedrooms renting for $850 each per month. My maximum (not allowing for vacancy) income went from $30,000 to $21,250. My gross income dropped by 30% and my initial upfront (remodeling) costs almost tripled. Long story short, when I have analyzed properties in this manner, I cant get the numbers to work in a manner that makes me want to deploy capital to undertake such a project. I will keep looking at them as leads. Has anybody else been able to look at these from a different angle or perspective and find a lucrative deal?
@Jeremy Hunsberger. the above comments are correct in terms of finding & keeping tenants in these places. If you were near large construction project then maybe I would consider it for short term rentals. And at $35/unit I believe you can do better elsewhere.
I have also wondered about this been doing my homework,im in the middle of a deal still putting together as we speak, on a 88 door motel I picked up in distress, walking thru the building the construction of this project will be too take down the dividing wall between two rooms and will give me around 1200sqft apartments but what about the look the curb appeal will this hurt the rent what can be done to change this look????
keep as a motel till you figure out what you want also on one of my properties I contacted the VET ASSIST PROGRAM, there are a few hoops to jump thru liability ins etc but I now have a 3 plex 2 bd apts, I'm able to put 1 person in each bd room now instead of 3 rentals I have 6 rents coming in may be something you want to look into
@Richard Heck Could you explain how the vet assist program works? Is this similar to section 8?