Large multi-family (5+ units) buy & hold investment in Birmingham.
Purchase price: $3,355,000
Cash invested: $240,000
104 unit purchased in West End, Birmingham, AL. 93% occupied upon purchase, lot's of Capex done by previous owner. Mostly a momentum play picked up at a discount, but operational upside and some rent growth available to capitalize on as well.
What made you interested in investing in this type of deal?
The fact that it already made money. 93% occupied on acquisition, so not many units to immediately turn and plenty of operational upside.
How did you find this deal and how did you negotiate it?
Found off-market through a broker relationship. We convinced the owner to sell us this property and another out of his portfolio at a discount, while he went on to put several other properties on the market at retail value.
How did you finance this deal?
Private money to close front end, will refinance within 6 months into a longer term product
How did you add value to the deal?
Operating the property more effectively by sharing resources and personnel from other nearby properties we own. Rent bumps, light turns (Vinyl floors, counter tops, paint, tile in bathrooms), RUBS
What was the outcome?
Just acquired in November so it is an on going process. Happy with the rent collection so far.
Lessons learned? Challenges?
This was a simple transaction with the exception of a few things that can't be accounted for, like our lender having to evacuate their building due to a wildfire causing the financing to be late.
@Caleb Bryant Congrats and thanks for sharing. I'm a new Birmingham REI but would love to connect one day.
@Caleb Bryant Nice work. Good to see your expansion. What was it that convinced the seller the sell at discount if others went on MLS?
@Sha Harris thank you! You’re in a good place for investment!
@Stefan Abel owner had to return money to a fund so he had a timeline. We have a lot of experience in that sub market and he knew that it’d be hard to sell to non local people quickly because they only like the strongest sub markets like Vestavia Hills, Hoover or Homewood. That and my partner’s negotiating skills probably had something to do with it too haha. The other property was in an easy sell sub market and we didn’t want to come up to his price (which he will totally get if he hasn’t already)
Great job @Caleb Bryant ! Can't go wrong with 93% occupancy. Cash-flow is king! Congrats!
Noyce. I be like you one day.
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