Chicago - Roscoe Village 4 unit BRRR! Deal Diary
I was the Broker representing the buyers side. Happy to walk my Biggerpockets friends through the before and after!
3 units + 3 story coach house (was 2 units we are converting into 1 luxury 4br 2ba). Bought for $730,000 within 72 hours of list in MLS. Multiple offer situation (later learned ours was not the highest) we got the deal by offering high earnest money 25k and 75k providing a strong offer. Property ended up appraising 20k over! We are also hoping that the new Lathrop Homes redevelopment of the old housing projects nearby appreciates this area even more.
Project plan: Value add to the 3 units + Coach House through a rehab. We are putting roughly $40k into each unit which includes new floors, kitchens, updating bathrooms and moving a few walls to open the units up into a more modern layout. The units came in good shape and passed the inspection with no major issues but were cosmetically outdated and as you can see full of junk, fun cleanup :) Our goal is to create gross rents of $8550 per a month or $102,600 annually. We will then either sell the property at a mid 6 cap or refinance out of the construction loan and hold long term. We are very bullish on this area and have prior experience in the direct neighborhood.
Road bumps: Had the property rezoned to certify legal 3 units+legal 4th unit coach house which delayed the close for several weeks.
Construction is set to commence at the beginning of December. Will be posting some after construction shots next ;)