I am absolutely fascinated with multi-family real estate, specifically the idea of converting inactive hotels/motels into affordable living spaces to buy and hold. I think its a very lucrative and unsaturated market for those looking to get into affordable multi-family opportunities. The prices for these dilapidated buildings can be very reasonable and if they have been out of commission for a while, some sellers are willing to accept creative financing options.
I started my journey of searching for old motels in Michigan about a year ago, only focusing on it on my spare time while I work on my e-commerce businesses. The first deal I found was a 22 unit motel that had been closed since 2012, right across from a lake. I sent the seller an offer by mail with the data I found from the public tax records and went on to visit the property so that I can learn about this unlisted gem from the neighbors. To my dismay, one of the old managers of the complex informed me that the owners had just sold the property to someone else! What timing!
Currently, I have a bid pending on a new property and I am very confident that I will get it approved! I also contacted a gentleman in Florida, who I learned about while Googling "Motel Apartment Conversions" many months back. In exchange for his expertise and consultation on the deal, I offered him a position! He said YES! This is good news for my lenders, since I have very little experience in real estate, and he has literally converted hundreds of large hotel units in Sarasota Florida.
Here's the catch. I got excited and dug too fast. The deal is great, lots of room to refinance and take money out from day 1. The market is in need of affordable housing where I plan to invest. The property is on a rather large plot of land AND it's across from a lake. The owners are open to creative financing and are motivated to sell. However, I didn't network with any lenders before I jumped into this.
There's a mixed feeling of stress and joy that I actually find rather pleasant, but it would be alleviated if someone could offer advice on how to approach lenders on this forum.
Thanks for listening,
Have you found any lenders?
I would think a local community bank would be a good fit if you have your budgets and contractors, etc.