First Florida multifamily closed!

First Florida multifamily closed!

Investor · Hayward, CA · Member since 2015 · 83 posts · 72 votes

Well, after about a year of effort researching, networking and trying to find a deal, I closed last week on a 16 unit multifamily in Tallahassee. My previous experience is all in SFR rehabs, but at this point I can't see ever going back. I want to shoot for >40 units next time! My original focus was solely Jacksonville FL, but the market was only offering 5-6 caps in the areas that I wanted to own. I'm well aware that we're late in this current cycle and didn't want to overpay too badly. As a new apartment investor, I was also conscious of my lack of credibility with most brokers. I expanded the search to several other N. Florida cities and was presented this deal by a broker I'd been chatting with. After viewing so many ridiculously exaggerated proformas, his caught my eye as being very realistic. During DD I checked bills, seller's bank accounts and schedule E's. Rents currently average $631 across all of the 2/1 units and should be in the $695-$725 range(improving gross rents to about 136K). Since purchasing I've added new landscaping, signage and gutters. I have a few other curb appeal, unit improvement tasks I'll periodically schedule over the next 12 months. Tenants are already asking my PM when the rent is going up, which I take as a sign they know they're undermarket. It's 100% occupied as well, so I expect a bit of turnover with the increases. Here's my pre-rent increase numbers. 680K purchase price, 730K appraisal. Property is located next to the community college, a few miles west of FSU.


Current gross annual rents- $120,960
6% vacancy- $7258
EGI- $113,702
Tax/Ins $13,000
Lscape(plus a 1-time $3300 charge for lottsa new stuff) $5400
Legal $1100
PM $13,000
Pest control $1,920
R&M&Capex $24,645
Utilities $1500
NOI $53,137

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Real Estate Agent · Indialantic, FL · Member since 2014 · 182 posts · 80 votes
9y

Congratulations!  Since this was your first multifamily was it difficult for you to find financing?

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  • Kevin BrownPro Member
    Jacksonville, FL · Member since 2015 · 9 posts · 3 votes
    9y

    Congrats @Brent M..   I plan to head in the same direction.  Good info!

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