Converting 7 Units into 8 Units
Hello everyone, so I found an off-market 7 Unit apartment building (seller financing) in the greater Lansing area in Michigan that is set up in a way that appears it can be converted into 8 units fairly easily. There are six 1bd units and one 2bd unit. The 2bd is 2 story unit that can be split in a way that would make the property look like 8 uniform units (Its a 2 story building with a 1 bedroom unit in each corner. I have never gone through the process of adding units to a property, but the property is in a really nice neighborhood. The subject property is the only eyesore on the street, it appears to need mostly just cosmetic interior/exterior upgrades, and it basically pencils out at 7 units-- with an 8-unit conversion it will allow a refinance of most or all of invested cash within 2 years. Does anyone have experience with similar projects? Would you invest in a project that depends on being able to split a unit into two? I have completed a bunch of SF flips and rented a couple of properties (SF and 4-unit properties) as well, however this current project is a new area for me. My vision for the property is clear (my strength), however I am lacking the commercial multifamily experience and deep pockets to jump in, so I'd love some help as I see good potential for this property. Any feedback is greatly appreciated.
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