Logistics for 4-Unit with retail pace + 3 residential units?

Question

I found a 4-unit small MF property that looks promising but one of said units is commercial/retail space while the other three are residential 1BR units. Was hoping to get some insight on the logistics (taxes, lending, etc.) for having both commercial and residential space within the same property.

If anyone has experience with a similar deal, I’d love to hear about that as well!

Michael Garofalo · Answer

@Emily Smith just food for thought, but have you considered converting the commercial/retail space to another apartment? Based on limited information, it seems as if this would already be considered a commercial property (and is zoned accordingly). There would likely be hoops to jump through to get it re-zoned but in theory, if it was zoned 4-family residential, that would unlock more favorable loan products and actually might make resale down the line easier.

Just thinking about what I would do with this deal if it was presented to me. Everyone will have a different opinion but my niche is small-midsized multifamily so I would most likely pursue this route assuming the numbers work and I understood what would be needed prior to closing.