Investor · Mesa, AZ · Member since 2020 · 32 posts · 27 votes
I was looking for a fourplex somewhere in the phoenix metro, and got fed up with the crappy prices of MLS deals. I decided to buy dirt and build my own. I've acquired the multifamily-zoned land, and am working through the process of getting approval to break ground. If it works out, it'll be 3 large fourplexes on 1.5 acres in Apache Junction, AZ, with a total of about 20k sf.
I'd be happy to connect and compare notes with anyone else who has done something similar.
Real Estate Agent · Wilmington, NC · Member since 2020 · 8 posts · 4 votes
4y
That's amazing! We are trying to do something similar, getting pricing now for what our options will be for Quadplex/Triplex construction since we will have the cash to do it with the sale of another investment.
We are located in Southeastern NC (just north of Wilmington) and the builder we spoke with advised we need minimum 1 acre for a single quadplex. What kind of floor plan style did you use to fit so many? I think we are trying to do more of a townhouse style so if we want to sell later we can do individual units or as a whole.
We are also going townhouse-style. To enable the option of individual sale (though we don't plan to do so), we need to do a short plat. Zoning requirements will vary a lot from one city to the next. A licensed architect will know the rules.
Investor · Mesa, AZ · Member since 2020 · 32 posts · 27 votes
4y
@Lauren Garritano the Google drive link I gave earlier contains a PDF file, "schematic drawings". The floor plans are in there. It is a mix of 4 and 3 bedroom layouts.
We own and operate a construction business in phoenix and are potentially wanting to start to break ground on a 2 acre multifamily parcel as well with similar number of units. Just had done a few preliminary meeting with city and wanting to move forward as well. Message me anytime
Dallas, TX · Member since 2021 · 7 posts · 4 votes
4y
I’m in Dallas and wanting to do the same thing. Starting to search for land and a builder. My main concern is the current cost of supplies and labor shortages. I have plans for a 4-plex but curious to know what price per square foot the builders are quoting you?
Investor · Mesa, AZ · Member since 2020 · 32 posts · 27 votes
4y
Numbers are very rough at this point, but I've been told by various people to expect between $125 to $250 per sf. I'll get more exact bids after we get through planning.
I really want to do some new builds myself. You've expressed my sentiments with what I see on the market for small multi-family properties. All the small multi-family units seem to be horribly priced and have been run into the ground. It's been more profitable for me in the OKC area to buy single-family homes in good shape. My family is in the Phoenix area so I'm somewhat familiar with the area but my real estate is all in OKC currently.
I'm very interested in hearing some of the finance details.
How much cash/downpayment did you bring to the table for financing your deal?
What loan type (terms as well) did you get for this deal?
Did you buy/finance the land separately from the construction?
What team have you needed so far? Architect, Contractors, Property Manager, anything else I'm missing
Real Estate Investor · Columbus, GA · Member since 2017 · 24 posts · 7 votes
4y
Wow. We're in the same boat and seems like many of us here. I am making an offer tomorrow on 2 acres of land and plan on building at least 3 fourplex. I'll be following this thread so keep us posted please.
Investor · Mesa, AZ · Member since 2020 · 32 posts · 27 votes
4y
@Cristian Portillo get a good architect. If you're going to build multiple 4plexes, try to split into separate parcels so that you can qualify for conventional financing. Good luck!
The dimensions of the buildings needed to be within some tight tolerances to work around easements, which meant that an off-the shelf design wasn't going to work. Given that, the scale of the project is not large enough to capture any economies of scale for prefab. We looked into it, and that was where the $250/sf number came from. We politely declined.
Rental Property Investor · Phoenix, AZ · Member since 2019 · 34 posts · 19 votes
4y
@Travis Heppe
Travis, that sounds like an awesome project. I am currently adding a new build to an existing property in downtown Phoenix. It’s zoned R-5, j bought it from a wholesaler. Originally, the property is a 2/1 with a casita in back. The casita in back is completely destroyed due to a fire. So I thought it was a great opportunity as we demo the casita (keeping the original brick exterior for the historic neighborhood) to expand it into a duplex. So now we will have a 2/1 main house fully renovated and upgraded, as well as a duplex in back, both 1/1 units. So overall going from 2 units to 3 units. The cost of adding the additional unit comes to about $80k per my contractors bid. All the ground work for the main house and casita would need to be done regardless, so why not take advantage of adding that infrastructure and add on the additional unit? I hired an architect/designer to handle all the permits and design, and they are working my contractor to keep on timeline.
Fort Worth, TX · Member since 2017 · 206 posts · 87 votes
4y
Fascinating stuff!! My husband was putting finishing touches on a duplex when a potential RENTER wandered up. That was WEDNESDAY. We're signing a contract TODAY to buy her 0.66 acres and literal dog poop house. So yes, we're looking to build as well. The numbers don't look good. Really, as bad as buying used looks, building looks more expensive. Yes, easy $125-200/sq ft. AFTER having bought the land. Depends on how much appreciation/cash flow you expect
Here's my question. We bought/rehabbed the duplex w cash and hope to finance out of it. After the rehab and paying cash for the afore mentioned property, we're cashed out. How much cash will a lender want in the bank in order to finance out the duplex??
Fort Worth, TX · Member since 2017 · 206 posts · 87 votes
4y
Fascinating stuff!! My husband was putting finishing touches on a duplex when a potential RENTER wandered up. That was WEDNESDAY. We're signing a contract TODAY to buy her 0.66 acres and literal dog poop house. So yes, we're looking to build as well. The numbers don't look good. Really, as bad as buying used looks, building looks more expensive. Yes, easy $125-200/sq ft. AFTER having bought the land. Depends on how much appreciation/cash flow you expect
Here's my question. We bought/rehabbed the duplex w cash and hope to finance out of it. After the rehab and paying cash for the afore mentioned property, we're cashed out. How much cash will a lender want in the bank in order to finance out the duplex??
Yes, the $125-200/sf is all after land purchase. There will also be additional costs unrelated to construction of the buildings: landscaping, architecture, permit soft costs, land prep. I'm budgeting $600k for non-construction costs.
@Anna Catron I don't know how to answer your question. We'll get there when we get there. I guess that my best advice would be to leave a very large buffer.
Investor · Mesa, AZ · Member since 2020 · 32 posts · 27 votes
4y
@Percy N. Not really. The land is zoned multifamily residential, so there is limited range for what can be done. Guidance from the city is a strong preference for a development that will blend in with the surrounding duplexes. We feel that our project achieves that.
The architect initially advocated for 16 smaller units, but that would have precluded keeping parcels separate, which would have complicated the financing plan.
I'm about $30k in for the soft costs so far. There's a lot more ahead.