Milwaukee Multi-Family; Neighborhoods; Student Housing

[John Franczyk]

I saw a 2-flat today in Milwaukee near King Park, roughly 1/2 mile north of Marquette U, 53205 zip code. Each unit had 2 brs and one bath, but the rooms were large. The property is a mess. It needs full electrical and plumbing upgrades, interior kitchen and bath rebuilds, exterior work, and tons of cosmetic work. Structurally it's sound, but we're looking at far more rehab investment than the neighborhood would support for residential housing.  On top of all else, the property has a $30K mortgage.

The possibly enticing piece (apart from some really nice antique stained glass) is that there are several vacant lots around the property that are included in the deal. Milwaukee had a program at one point that ceded ownership of lots to contiguous homeowners when an adjacent house was vacated. The homeowner accumulated contiguous lots through this program after the neighboring vacant houses were demolished. The lots are buildable, although the neighborhood right now is not exactly where someone will want to build.

I'm thinking the owner is going to let it go to the bank. I would be willing to make a fire sale bid on a short sale offer to try to get the vacant lots for someone else's future construction.  The only way this makes sense is if I can rent out the units after a more basic rehab and convert it to student housing.

My questions:  (1) are Marquette students going north to rent housing or are they staying closer to campus? (2) what is typical student housing rent for Marquette? 

Thanks!