Large multi-family (5+ units) other investment in Clearwater.
Purchase price: $5,900,000
Cash invested: $1,400,000
Sale price: $8,200,000
This walk-up garden style property is comprised of 72 units in Clearwater, Florida. It was purchased from a local value add investor as a stand alone deal.
The plan with this property was to make significant common area improvements, (common areas, landscaping, pool, area, business center) and renovate approx. half of the units (kitchens and baths) and sell the property. The property consisted of all two bedroom units and was well amenitized with a pool, clubhouse, etc.
What made you interested in investing in this type of deal?
This was an excellent value-add deal in the fast growing city of Clearwater Florida.
How did you find this deal and how did you negotiate it?
We found this deal working through our broker network who brought it to us on an "off market" basis.
How did you finance this deal?
The capital came from our syndicated investor pool. The debt was a Freddie Small Balance loan. The improvements were financed with equity.
How did you add value to the deal?
Through significant physical and management improvements.
What was the outcome?
Investor returns in excess of 30% annual ROI (2 1/2 year holding period).
Lessons learned? Challenges?
Biggest thing we learned - just how well Florida is growing!
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Casey Babb, now with Colliers Tampa Office was the broker on the deal. Ben Brown with Meridan Capital (NY Office) placed the debt for us.
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