10 unit value add in greater Sacramento area
Investment Info:
Large multi-family (5+ units) fix & flip investment in Woodland.
Purchase price: $1,130,000
Cash invested: $300,000
value add, very very VERY rough shape. Lots of upside potential. 415sqft garage that can easily be converted into an 11th unit. 2 vacant units that I remodeled and rented for $1,200 and $1,300 plus RUBS. It'll be a better than 1% deal in 6-9 months. It's a flip only if I can find an upleg to exchange into to.
What made you interested in investing in this type of deal?
great way to add both cash flow and appreciation
How did you find this deal and how did you negotiate it?
off market deal I was chasing for 2-3 years and seller was finally ready to let go
How did you finance this deal?
hard money loan at 6% and 75LTV and I used my savings for the down payment.
How did you add value to the deal?
in the process of renovating. Finished 2 units that were vacant and spent around $12k per unit which is pretty cheap for California and I upgraded everything and added washer/dryer hookups in one of the two units. See pics.
What was the outcome?
Still only about 3 months into the deal but so far I was able to raise rents, implement RUBS and turned 2 vacant units and added which added $3,830 to gross collections in 3 months.
Lessons learned? Challenges?
things never happen on schedule these days, haha. I learned to be more realistic about how quickly I can turn units. I thought I could turn and rent two 1br units in 1 month and turn a garage into a studio in 2 months. I'm 3 months in and the two units are done and rented but the garage is still in progress....
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Sunny Gill who is an allstar! Habitat Properties in Sacramento. Look him up!!
