Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
12y
You bring along a contractor or engineer who is experienced with the type of building and construction ... I still do that today! I am fairly confident in estimating the reno efforts within the individual units but when you start looking at the structural integrity of the building itself and some of the systems (HVAC, electrical, fire suppression, etc) which can be quite different than what you encounter in a smaller building, hire a professional.
This is one of the reasons you have a longer diligence periods on commercial / multi buildings.
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
12y
My thought is not to ball park anything, unless it's the initial gut reaction to spark you interest to even look at it, the asking price and location as well as number of units will do that. You should be able to walk through, have an idea of what needs to be done and roll the calculator having a good idea of material and labor costs. Rehabs are totally different from new construction where sq. ft. costs can be better applied. There is no short cut to accuracy. :)
There is too much variation in age (Old (pre-1900), Pre-war (1900 - 1939/40), Post-war (1946 - 1970), etc); construction (stick built, brick & mortar, steel & concrete, etc), design ... the list goes on. Multis will not be as uniform in construction as SFRs as there are fewer of them and they are often built years apart.
Sure multis built by the same builder and/or around the same time could be similar/identical ... so estimates/actuals from one might be portable to another. However, we have also found side-by-side multis built from the same plans at the same time (40 years ago) which had received different levels of maintenance and upgrades over the intervening years and had diverged sufficiently that estimates from one were not readily applied to the other.
As Bill mentioned, you need to learn to walk the building while "rolling the tape" in your head. Even then, you will run into buildings whose construction is "new to you" and will need to bring along a contractor or engineer.
[Note: when referring to Multis above, I mean real, purpose-built apartment buildings (6+ units) and not old converted (pre)Victorian SFRs {we have lots of those around here as well}.]
Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
12y
You bring along a contractor or engineer who is experienced with the type of building and construction ... I still do that today! I am fairly confident in estimating the reno efforts within the individual units but when you start looking at the structural integrity of the building itself and some of the systems (HVAC, electrical, fire suppression, etc) which can be quite different than what you encounter in a smaller building, hire a professional.
This is one of the reasons you have a longer diligence periods on commercial / multi buildings.
Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
12y
That's a loaded question. The answer is "it depends".
A general contractor will be $30 - $50 /hr {usually will rebate the time against any work that comes there way}.
The engineer who does my building inspections charges me by the day, but it usually works out around $100 - $150/unit for him to do a comprehensive crawl through the entire building.
Environmental / Fire / Structural engineering firms can be $100 - $500/hour ... the more specialized, the higher the rate. I usually use my GC or building inspector to identify issues before hiring the "experts" to come in.
When pursuing a new property, we budget $250 - $500/unit for diligence {the more units the lower the amount per unit}. The actuals have always been at the bottom end for us, but all takes is one property that needs a Phase II Environmental Site Assessment to put you at the other end.