Deal Diary of 8 Unit property in Norfolk Virginia

[Douglas Mcqueen]

We closed on an 8 unit building in the Hampton Roads region of Virginia on 19 Mar 2021, more specifically in the Ocean View section of Norfolk not far from Virginia Beach. the specifics of the property are as follows:

Address: 1600 Queens Land Ave. 

Unit Count: 8 

Unit break down: 2 BR, 1 BA

Unit SqFt: 650 

Build Date: 03/07/1985 

Original Sales Price: 50,000.00

Assessed Value: 477,300.00 

Strike Price: 500,000.00 

Contract Price: 481,000.00

Final Sales Price: 476,500.00

EST ARV: 750,000.00

Rehab budget: 60,000.00

Parcel size: 9,500 SqFt 

Contract Date: 02/12/2021 

Closed Date: 03/19/2021

Occupancy: 6 of 8 rented, 1 moving out within 30 days of close.

Lease Status: 5 of 6 residents on month to month, 1 resident under lease till Nov 2021

Current monthly rental income: 4,265.00

Projected Monthly income post stabilization: 7,200.00

Due Diligence Issues Found: Leaking roof over laundry room, Quest piping throughout, Parking lot in need of repair, lackluster accounting, old outdated leases, no real management present and a ton of deferred maintenance.

The process leading up to this point is detailed here: https://www.biggerpockets.com/...

I will document the process as best I can here and try to provide at least weekly updates.

Week 1:

We are in the building and tenants have been notified of the change of hands in management and ownership.  We have two vacant units with another one coming vacant soon and we have begun tear out.  Concurrently we have started working on the laundry room which is a disaster.  All the old cabinets, vanities, fixtures, flooring, polybutylene (quest) plumbing and appliances have been removed. 

Week 2:

All new toilets, vanities have been obtained.  Water meters have arrived to submeter all 8 units, 3600lbs of porcelain tile and ceiling fans are here as well.  Electrical in the vacant units (outlets, switches, ceiling fans, light fixtures, faceplates, gfi's) has been removed and replaced.  Laundry room has new electrical as well, lighting with motion switch new door and drywall repairs complete.  Subfloors have been screwed down to alleviate creeks and squeaks, kitchens and bathrooms have been prepped for tile.  Plumbing in the vacant units have been re-piped in PEX and sub meters are installed.