Investor · San Ramon, CA · Member since 2011 · 1k+ posts · 569 votes
14y
Zach, I would be more concerned with the market for larger apartments than the initial start-up cost. Is the market strongest for 1, 2, or 3 bedroom units? Ideally you'd have a mix.
It's probably worth while sitting down with a designer of some sorts that can look at what's existing. You have some large rooms that can easily be turned into economy/studio apartments, etc...
Investor · Mission Viejo, CA · Member since 2012 · 627 posts · 204 votes
14y
You need to find a good environmental consultant in your area to inspect that 1955 building for asbestos and lead-based paint. Both are highly regulated, and there are special rules for lead-based paint in residential buildings. The consultant should also check for fluorescent lights (PCBs & Mercury), as they cost money to dispose.
Also, before you buy, you should obtain a Phase I Environmental Site Assessment. If you own the property for any length of time, you are 100% liable for cleaning up pollution or contamination caused by previous owners/uses. That could exceed the value of the property, or even your net worth.
Multi-family Investor · New York City, NY · Member since 2012 · 30 posts · 6 votes
14y
Not to complicate things too much. But have you considered a mix used property? That may save you some money and time on the renovations, if you can keep some of the commercial space marketable with minimal renovations.
Investor · Mission Viejo, CA · Member since 2012 · 627 posts · 204 votes
14y
I forgot to mention costs earlier. A Phase I with asbestos, lead, and miscellaneous toxic materials surveys of that building should cost $3,500 to $4,000. Big companies will send their junior staff or trainees, so you'll get more with a smaller consulting company. Insist that the site visit and data analysis portions of teh Phase I be done by an "environmental professional" as defined in EPA All Appropriate inquiries regulation and the ASTM E1527 standard.