Large multi-family (5+ units) buy & hold investment in Baton Rouge.
Purchase price: $640,000
Cash invested: $2,500
3 x 4-plexes together, 2 br/2 bath. Unoccupied at purchase. Close to LSU. Purchase price $560k. Commercial loan for $640k for purchase cost and upfront repairs. First year interest only. 5.5% fixed for 3 years. 20 year term. Avg rents $875. Repairs completed and 100% occupancy in 6 months. Titles to 3 other investment homes owned free and clear as collateral / down payment. Only "cash invested" was taking out a flood insurance policy on one of the investment homes used for collateral.
What made you interested in investing in this type of deal?
Started investing Baton Rouge area purchasing 7 SFRs in 1 year for buy and hold. All cash deals. Wanted to scale up in year 2.
How did you find this deal and how did you negotiate it?
Zillow. Seller was distressed. Poor management had all units vacant and in poor condition. Last sold for $1.2M. Appraisal came in below our accepted offer price. Renegotiated even lower.
How did you finance this deal?
Portfolio lendor. Lots of phone calls to local/regional banks.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Calvin Clement with Pennant Real Estate.
Congrats on the deal, Jason. Since going to LSU I've always been interested in buying some of the older complexes in the area. Best of luck with the property.
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