Extra Apt Complex Space...What to Do?!?

Question

I recently purchased a 16 unit beautiful apt complex. I’m currently renovating the whole building and things are going well. The building used to be a YMCA and it has an empty swimming pool. The room is about 1500 Sq Ft.......I plan to fill in this pool and make use of the space. My dilemma is what is the best use of this space? I’m thinking storage to other biz or general public as the best options (would be climate controlled) or possibly a crossfit gym. Thoughts???

Yonah Weiss · Answer

@Michael Cole If you can't add more units, think of an amenity that will not only be more beneficial to the tenants, but will also drive more revenue. You mentioned storage, and it could be rent-able self-storage units. A gym or pet area, would be something potential tenants would pay more for. Another option would be to make a laundry room (if the units will not have washer/dryer). Check out this post I did a while back with a TON of suggestions. https://www.biggerpockets.com/forums/432/topics/667635-multifamily-value-add-suggestions?page=1

Michael Cole · Answer

Typically I would agree but a buildout for more residential units doesn’t work logistically for this space. So I need to come up with other money making solutions.

Joseph Firmin · Answer

With the open pit, how difficult would it be to run plumbing and get more units in that space. You could dramatically lift the value of the building by adding more units/rents. It may be expensive, but not doubt you'd be able to make that back on a refinance.

Michael Cole · Answer

Yes this is def something that crossed my mind. This would require that I add a bathroom and do a build out and add windows.

I still think hydroponics or storage is my best option.......good thing is I don’t need to make a decision now I’ll be doing more research over the next few months

Benjamin B. · Answer

Is coworking space popular in your area for people that work from home? Or something similar to what mrmoneymustache blog co sharing space with a monthly fee?

Theresa Harris · Answer

I'd add more living space.  You can cut out windows and add sound proofing.  Storage lockers are an option.  If the units do not have in suite laundry, adding a second laundry room.  Not sure what the liability would be if you added a gym-plus you'd have to keep the equipment and washroom clean.

Michael Cole · Answer

@Yonah Weiss thanks for the tips!! Good thing there is already washing machines and I’m in the process of adding a gym to a separate room. Storage may be an option but with only 16 units I may add storage separately.

Its 1500 sq ft so thats why im thinking storage to the outside community (but there are a lot of steps for access) or hydroponics biz.

I def agree I want it to drive revenues because it will probably cost $40-50k alone to fill in the pool. I need something that will drive revenues to make up for these costs.

Scott Mac · Answer

If the build out costs make sense, more units.

Michael Cole · Answer

What about a hydroponics business.....does anyone have experience with this?

Michael Cole · Answer

It’s a thought that crossed my mind but this space is set up to be more utilitarian/warehouse IMO versus a resident space. Currently there are no windows and strangely enough the parking deck is partially over this area so Im not sure if noise or water could be an issue.

I def do agree if the construction costs are not insane it the bump in NOI +refi would most surely pay for itself.

Extra Apt Complex Space...What to Do?!?

Most Popular Reply