Building 20 units next to a university

[Sam Askar]

I am a build and hold investor. We usually build 4 plexus and build and sell SFHs. We came a cross this lot from another deal we had Previously made with the seller after we bought 14 lots from him. He mentioned that he has a commercial lot in the University area currently zoned to have two 4 Plexes on 2 Separate lot next to each other. The replot is easy to combine them to 1 lot. We went though it recently on a different deal it took about 4-10 weeks to get it done.

The lot can handle 20 units apartments two stories 10 on 2nd floor and 10 on the first floor. There are many apartments already existing in the surrounding area and they are all build in the 60s 70s and 80s Currently a one bedroom renting for $450 and two bedrooms renting for $650. But kinda of trashy old buildings around the lot. The university has 30,000 students.

There are some other new apartments (1-10 years old ) but Within 1 to 2 miles walking distance this lot is within two blocks from the University with a lot of bars and restaurants in the area

My questions are.

How can you build them on the cheap to make Sense and make the numbers work ? and still make them look nice For students?

Should I go with a plan for 2 master bedrooms with 2 bathrooms. ? Or 3 beds with 2 bath. (1 master bed ). ?

Anybody have done /rented to students in the past ?

Building cost about is about $60k per door and land is $200k. Renting 2 beds 2 baths. For $600 per month. Paying water and trash only. Will have prepay washer and dryers on site , no gas. All electric stoves, heating cooling , and water heater . Electric paid by tenants. Will be turned to management company to Handel once built rates here from 7-10%

Any thoughts /advice experience will be much appreciated

[Peter Tverdov]

IMO you are going to be charging a lot more if it is a brand new 20 unit apartment building. This has happened at Rutgers (and they're really overbuilding now) but the new apartment buildings (20-60 unit buildings) are charging $1000 a bed. Yes, that's NJ but it's not far off from what the University charges. If there is nothing like that up at the University you are mentioning and enrollment is 30,000 then you have struck gold.