Exit Strategy, Single Family End of Lease

[Brett Bennett]

Fellow investors -

The existing tenants at my Minneapolis property have notified me of lease termination starting 7/31. I would like to get some input on exit strategy for this property by assessing options during this turnover. Specifically, I am interested in comparing numbers in renting vs. selling scenarios.

Options:
1. Use post-lease period to fix, stage, and sell the property. Liquidation takes advantage of the existing market as well as currently beneficial equity-to-debt position. Most importantly, gains will be available for use in other markets.

2. The property is in a high-demand neighborhood, and I expect no lags in occupancy. It continues to gain value, and the neighborhood is continually improving. This essentially guarantees continued cash flow, loan paydown, and appreciation. While this is a beneficial scenario, I would need to get creative with financing for planned upcoming investments.

My goals long-term are to balance debt leverage (making sure equity is not sitting unused) with overall accumulation of units.

Thoughts? Thank you!

Brett

[Alyssa Strom]

@Brett Bennett Got it! I was thinking upcoming investments meant cap ex for your current property. @Tim Swierczek would be a great resource for exploring home equity options and running those numbers. Without knowing your exact financial position, I would probably sell and use the proceeds on some out of state multi-family assets.