Small Mixed use (commercial & residential) development question
I am interested in hearing from others on BP regarding developing small mixed use buildings (commercial first floor, residential second floor). Around me (New Orleans), there are available empty lots that can be developed for mixed use. Several of these appear to be in a decent area that could support mixed use. My initial thoughts would be to develop the property with a single commercial space on the first floor (build out a basic white box) and have one or two residential apartments above. I would guess that the property would be ~2000ft2 commerical and 2000ft2 residential (likely 2 x 2bed/1bath apartments). Based on the area, the commercial space would be retail or professional offices.
I have done residential duplex development and am very comfortable with that. But really dont know much about mixed use development.
This would be the largest project I have done. Talked with my bank and they indicate that they would be onboard for the construction loan. I am not sure how permanent financing would work at this point, or how the project would be valued (I assume based on CAP rates for the entire building).
I would love to hear from those that have done it.