Finding Investors and Mentors for $13 Million Apartment complex
To start out I am doing this as a personal exercise to learn how to do these types of deals for the future, currently I have not yet done a deal of this size. Please help me improve.
Unit Mix Information
Units:
1+1 : 59
Avg. Rent/Mo: Negotiable
Sq. Ft. : 720
2+1: 6
Avg. Rent/Mo: Negotiable
Sq. Ft. : 1,008
2+2: 31
Avg. Rent/Mo Negotiable
Sq. Ft. : 1,008 - 1,010
Unit Amenities
- Balcony
- Refrigerator
- Washer/Dryer
- Oven
- Heating
- Range
- Kitchen
- Tub/Shower
Site Amenities
- Clubhouse
- Community-Wide WiFi
- Fitness Center
- Public Transportation
- Media Center/Movie Theatre
Financial Summary (Pro forma - 2018)
Gross Rental Income Annual Annual Per SF
$1,294,718 16.81
Effective Gross Income $1,294,718 16.81
Avg Household income
43%: $100k+
15%: $75k-$100k
28%: $35k - $75k
14%: 0k - $35k
Total Population
1 Mile: 4,029
3 Miles: 29,950
5 Miles: 69,572
The Property:
Price $13,000,000
No. Units 96
Property Type: Multifamily
Property Sub-type: Apartments
Apartment Style: Low Rise
Building Class: 4A
Lot Size 3.68 AC
Building Size 77,000 SF
Average Occupancy 97%
No. Stories 3
Year Built 2016
Highlights
Shuttle service
Sound proofing between suites
Underground heated parking
Buyer-favorable loan to be assumed
Description
Property offers the best of a great location and quiet neighborhood with ease of commute to downtown, both through its ease of access to Highway and the on-site shuttle service. Amenities offered include site-wide WiFi, workout room, lounge and game-room. Since it opened its doors property has had strong occupancy and is one of urban city's nicest new apartment complexes.
State:MN
First Half taxes: $71,610
Second Half taxes: $71,610
Property Tax from county statement total due for 2019: $143,220.00
My initial ideas on purchasing and increasing value:
- Acquire investors (1-3) to put down 30% or more of the total price to secure a loan with a bank.
- Purchase property using loan through a C corporation for tax incentives and liability protections.
- If property is not currently being managed by a professional company, locate up to 3 professional management companies and determine best one to run day to day operations.
- Lease out Fitness center to a National fitness company, IE Snap fitness etc under contract, allowing them to renovate and update the space. Currently its a few cardio machines and 2 tv's in a plain white room with a separate room for lifting. Update to 1 open area with changing rooms and possibly a sauna as well etc.
- Lease out club room, currently a room with a couch and a tv to a Juice bar or coffee company.
- Update Game room to more than a pool table and TV, place furniture from club room into game room. or update to a business center with public use PC's, Printer/ Copy/ Fax machines.
- Reevaluate Property value with bank to pay back initial invested amount with a previously agreed amount of interest and % ownership
- Profit?
Thank you for reading this any notes are appreciated.
I have been studying smaller (SF) property investment for 2 years, and have yet to get "skin in the game" at any level so far.
I am planning on starting this year, either big or small though preferably bigger like this property.
PM's are accepted.