Diary of a project that will spring board my career

14 Replies

So I decided I will start a thread about a project that is currently in its infancy. When the project is completed, the value of the property will essentially double (I have Leases already in place for when the project is finished that are 71% higher than my current rents) and it is going to allow me to have a reasonable opportunity to hit my 4-5 year real estate goal (more on that when the time is right) because my plan is to re-fi this fall out once completed and stabilized (basically BRRRR on a larger scale).

To start, it is a 2 family 5 bedroom student rental property that I have managed for a few years and bought off-market from the owner last summer. It was in good shape already but with the proper upgrades, I knew I could increase the rents further (obviously having to spend money to do so). While discussing my intent with the owner, he literally gave me the idea to build an addition and by talking to the proper people, long story short I decided I wanted to finish the basement and build an addition. 

Step 1 for me was hiring my team (attorney, architect, planner) and having a plan in place (proposal was to add driveway parking for 2 cars where none currently existed and add 3 bedrooms, laundry room and full bath between the two units).

Step 2 - It took 4 months from closing, but I received Zoning Board approval for C and D Variances along with other smaller variances. This approval really hit home for me, because along the way I came across one attorney who charged me $750 for a feasibility study, to determine if what I wanted to do was doable. His words, "no shot to get approved. I won't even take your money". After getting the approval (which was a 50/50 shot), this was a powerful lesson to my wife (and sister who came to watch) that you NEVER take no for an answer if you truly believe in something. 

Step 3 - Waterproof the basement. I had this person lined up for months but obviously didn't want to start work until I knew I was approved. I found a fantastic contractor to do this that I would highly recommend for all of NJ. The basement went from a wet one to looking bone dry after storms. He was finished in 4 days and the space looked great.

Step 4 - Get quotes and hire someone for the driveway work, sidewalk needed and landscaping. This was incredibly frustrating because I must have called 15-20 contractors and after having 6-10 come out to the job site with me to give me an estimate...I received a whopping 4 estimates. Mind blowing. Anyway, those folks are hired and their work will start spring time. I will submit permits for that this month, but no rush because they won't grant permits during winter time anyway.

Step 5 is where I currently am, hire a GC to do the work. Again, the proposal is to finish a 600+ sqft basement, add 2 bedrooms, walk-in closet, full bath, utility room, laundry room and Central Air. Second floor we will need to add a 250 sqft addition which will bump out the existing living room, add another bedroom and convert an existing pantry into a laundry room.

I plan to have the first hammer swung in March for about a week to do all the framing and rough plumbing, rough electric. Will sign a proposal this week with a contractor who has done work for me in the past and he will put in the permits next week. I am sure it will be stressful but looking forward to answering any questions people have and taking you through my journey! I will load pics when I can.

Looking forward to your progress work Pete!

I think investing in college property is so interesting so I'm looking forward to updates. Good luck.

This is great Peter, looking forward to following this journey.

So no work was done until the very last day of March. I stopped by on Saturday and the basement looks like an asteroid hit it lol. The plumber has dug out the areas for all of the plumbing. I really wanted to have the waste lines connect to the main sewer line but the proposed bathroom is just too far away (16-20 feet) and we would run into code issues raising the floor in the bathroom. So, looks like they will put in an ejector pump which I am not a fan of but don't really have a choice.

Also should have the permits approved for outside masonry work to begin. Will be removing a one car driveway in one area, filling in the area with grass, adding back a curb (and one public parking space) and then installing a 2 car wide driveway. My goal is to have that exterior work completed by the end of this month (although I would just be happy with the sidewalk and curbs being done first).

We have started a little slow but the good news is all permits are in and work is starting, the snow in March didn't help!

Two updates - Permits can't get approved for site plan work yet. ZB insits that I post a bond for the work I am doing to the sidewalks and driveway. Kind of frustrating because the entire job costs roughly 10k, not like I am installing a massive parking lot. So once I get the numbers from the city I will have to post some money in escrow to be returned to me once the job is completed. THEN they will issue permits...now hoping I can start sometime next week for that work.

Second update - framing started today in the basement and my GC called me up to tell me the architect drew the furnaces facing in the wrong direction which makes things hairy where a proposed egress window will go. He is suggesting ripping out the furnaces to make more room for the bedroom and to run a gas line to a recently installed Central Air unit so the tenants can have forced hot air. I am leaning towards doing that if it is not crazy expensive. Both the 1st and 2nd floor would need the gas line and I would likely just leave the baseboards in the apartments so I don't have to replace all of the flooring as well.

In the mean time here are some blueprints of the proposed work in the basement and 2nd floor addition: 

@Peter T. Great stuff, Peter. Keep up the good work. Looking forward to reading how the project progresses

Gotta love when GCs blame the Architect. (Hint hint I am an Architect) 

FYI- Architects don't place boilers on plans as a final location. It's up to the GC to walk with heating/mechanical subcontractor to establish the best location in mech. space and orientation for his ducts/piping. 

If your GC is considering this "architect mistake" and benefiting from the extra work as a change order (more money to him) you should be weary. 

Second thought: What Mechanical contractor installs a boiler based off architect floor plans when they're installing the system!?

Originally posted by @Jared W Smith :

Gotta love when GCs blame the Architect. (Hint hint I am an Architect) 

FYI- Architects don't place boilers on plans as a final location. It's up to the GC to walk with heating/mechanical subcontractor to establish the best location in mech. space and orientation for his ducts/piping. 

If your GC is considering this "architect mistake" and benefiting from the extra work as a change order (more money to him) you should be weary. 

Second thought: What Mechanical contractor installs a boiler based off architect floor plans when they're installing the system!?

 The mechanicals in the basement were all pre-existing. So I either need to install an additional door in the bedroom right by the boilers so a plumber in the future can actually access them (given they are facing in the wrong direction on the drawing...if you look at the drawing the front of them are facing 9 o'clock but it's really supposed to be 6 o'clock) or I rip out the boilers (installed 2009, a lot of life left IMO) and run gas lines to the newly installed Central Air unit in the other bedroom and gas lines to the attic where the 2nd apartment Central air is installed. I should get pricing on that this week to determine what I want to do. 

So I decided to rip the boilers out...gonna try to sell one to the plumber and use the other one to replace a 30 year old boiler on another property in the future. I'd say 90% of the framing is now complete. Some pics below finally.

BATHROOM FRAMED OUT (using an ejector pump, the areas dug out are for the bathtub and toilet plumbing.)

Another angle of the bathroom from where the shower head would be

This will be a walk in closet for a college student...spoiling them haha

One very large bedroom framed (apologize for the graffiti, this house was treated as an over flow frat house for years). I also don't want to spend the money to remove the pillar, we will frame around it.

2nd bedroom framed

Aiming for rough electrical and plumbing to get installed by next Saturday

Hoping to start work on the concrete and driveway outside by the following week (permit process got held up by the Engineering department).

The last 10 days have been very frustrating. The Engineering department has pumped me for roughly $1500 in fees and were being very challenging signing off on my site plans and asking for things that weren't required. Then yesterday the head guy went out to the site and decided I needed 100+ sqft of curb to replace in addition to 8 sidewalk slabs because they were a tripping hazard (not really IMO). Long story short my exterior work is looking at another $5-10k in costs, on top of having to post a bond in the 5 figure range that I was blind sided by. So the engineering department has basically handed me a bill for $20k that I was obviously not prepared for in addition to my budget. Oh and they still have not given me my permits so my goal of having that work done by end of this month is out the window. 

Good news is that work is progressing nicely and I am hopeful to get the basement windows and roof done next week with a rough inspection to follow. Then there will be a 10 day break and work will resume May 14th for sheetrock and insulation in the basement. 

Bad news is I have had to make some more modifications to the 1st floor (opening a wall in the LR, removing a closet in the LR and creating a new wall in one of the bedrooms to expand the LR), modifications to the basement (replacing stairwells going down) in addition to removing the boilers. I am getting close to being maxed on my budget (in my mind anyway) so will have to be really strict over the next few weeks so I can get 90-100% of my money back out when I go to refi. 

What I have learned so far through this process is that you can get nickle and dimed to death by the town/city after approval. It's almost like a hidden tax. My suggestion to people is if you go for a variance, swing for the fences because there is a lot of red tape that adds up fast and gets stressful. 

Roof was replaced already this week.

Basement egress window wells have been dug out and windows ordered.

GC is working hard to finish all the roughing this week for the rough inspection on Monday. Then there is a 2 week break because finals are going on and I don't want the tenants disturbed. All that he has left is removing boilers, moving a Central Air unit a few feet and adding some gas lines. He has until Saturday (fingers crossed), otherwise we'll pick back up mid-May. 

Rough inspection and insulation inspection passed this week. They have already installed all the basement windows, dug and installed egress window wells (architect failed to provide a grading plan for the wells so my GC and him are going to figure that out). They will be doing sheet rock and spackle this week (should be able to upload pics for that).

Meanwhile, outside all of the bad sidewalks in the city's eyes have been torn out, fence/shrubs torn out and if the weather cooperates next week the sidewalks and apron should be done.

Making progress and my stress level is going down. I expect the basement to be completed finished with final inspection passed by mid-June. Addition framing to start next 1-2 weeks.

Just seen this post... If you look at bedroom #2 in the basement, is that a column in the middle of the room?  My first thought is where will a bed go because it looks like it won't fit anywhere. What size bed can you fit in the room (twin, full, queen)?  It doesn't seem functional as a bedroom. I hope I am wrong and not understanding what is drawn.

Originally posted by @Jim Adrian :

Just seen this post... If you look at bedroom #2 in the basement, is that a column in the middle of the room?  My first thought is where will a bed go because it looks like it won't fit anywhere. What size bed can you fit in the room (twin, full, queen)?  It doesn't seem functional as a bedroom. I hope I am wrong and not understanding what is drawn.

There is a column. I didn't want to remove it because I don't really need to (I admit it's unorthodox). The bedroom is massive (close to 200 sqft now that I ripped both boilers out that were in the original drawing) so you can easily fit two beds in there and that bedroom in particular has a 50-60 sqft walk in closet as a major selling point. I'm not worried about it, most students use twins or full beds in a double bedroom and for context in my area most double bedrooms are 120-140 sqft. 

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