Chicago - Roscoe Village 4 unit BRRR! Deal Diary

14 Replies

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 The units came in good shape and passed the inspection with no major issues but were cosmetically outdated and as you can see full of junk, fun cleanup :) Our goal is to create gross rents of $8550 per a month or $102,600 annually.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 ;)

Awesome! Congrats.

Great potential rents. 

How did you get it rezoned?

Thanks Syed just sent you a connection request. The title company filed for a new certificate of zoning compliance and we had it about a week later. 

Following. I'm looking to invest in the Chicago market and I'm interested in how this turns out. 

@Henry Lazerow That's great. It's a great area and I'm sure the finished product will be a beauty. How difficult was the rezoning process? I was told to not even bother on another deal I did. 

Also, what's your rehab timeline? 

@Henry Lazerow where was the property located in reference to Lathrope? I was asking because I have 3 lots around the corner from Lathrope.

@John Casmon

Due to the age and being grandfathered in it was actually pretty quick change to the zoning doc to show that it was legal 4. Pretty simple process most any title company can order a new zoning doc made for you. Not like trying to change the actual zoning of the area which would be a much longer process.  

Yep this sounds like a simple rezoning (at least in terms of rezoning work..). Really curious to see more pics of the place if you don't mind. 

The hardwood floors already look amazing in that one picture. Neighborhood is great and appreciating fast, but obviously there was a pretty high capital investment on this... 20% of 730 + what ever your lost rent is while renovating. Can you give any more of the financial breakdown on this? I'm way too worried to go into these nice/high price areas.

Originally posted by @Henry Lazerow :

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 ;)

 Hey Henry, your project looks awesome.  I'm doing a fairly similar project up in Edgewater!   We're a few weeks away from being complete now!    I'd love it if you could provide updates as your project continues.  

This post has been removed.

Rehab finished......

Garden: 

Floor 2

Coach House - Huge Master 

I’m a big fan of leaving the old oak features and incorporating the new white a grey color scheme.

Your place looks great! Best of luck to you!!

Join the Largest Real Estate Investing Community

Basic membership is free, forever.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.