Case Study: 3701 College Main — Hidden Lot, Maximum Value

[Forrest Webber]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $132,000
Sale price: $350,000

Case Study: 3701 College Main — Hidden Lot, Maximum Value
This deal didn’t start as a development play. We originally acquired a 3-bed, 2-bath rental that leased for $1,300/month. But the property sat on an oversized lot, and most investors wouldn’t have noticed the potential.

Luckily, my partner served on the Planning and Zoning Committee and recognized the opportunity. We moved quickly to replat the parcel, creating a legal, buildable lot next door at a new address—all while holding the original rental.

With the replat complete, we essentially walked into a construction loan with a free and clear piece of dirt. (Some banks will allow you to “limp in” if your land value exceeds the equity requirement.)

We built a 5-bed, 5.5-bath luxury-grade home on that lot, which leased up immediately for $2,750/month. The project was an easy, clean lease-up and a major shift in how I now think about infill, zoning, and unlocking hidden value on oversized lots.

This became one of my favorite plays: spotting value where others don’t, creating something almost out of thin air. I’ve been searching for and collaborating on similar “hidden lot” opportunities ever since.

What made you interested in investing in this type of deal?

I’ve always looked for opportunities that hide in plain sight. Infill lots and underutilized parcels in solid rental markets offer the chance to create value where others see none. This deal was the perfect example—a standard rental acquisition that turned into a development opportunity through creative thinking and a deep understanding of zoning.

How did you find this deal and how did you negotiate it?

We originally acquired the neighboring 3-bed, 2-bath rental as a typical buy-and-hold deal. During due diligence, we realized the lot was oversized. My partner, who served on the Planning and Zoning Committee, identified that a legal lot split was possible. There wasn’t heavy competition because the potential wasn’t obvious to most buyers, so we negotiated standard rental pricing without paying a premium for the additional land value.

How did you finance this deal?

The initial rental purchase was a simple DSCR loan. Once we replatted and created the legal lot, we secured a construction loan for the new build. The lot's appraised value exceeded the equity requirement for the bank, which allowed us to "limp in" with minimal additional capital.

How did you add value to the deal?

The value creation came entirely from the entitlement and construction process. We took a single oversized lot and legally divided it, creating a free and clear, buildable parcel. We then developed a new 5-bed, 5.5-bath luxury single-family rental on that land. The new home leased quickly for $2,750/month, compared to (or combined with, really) the original rental at $1,300/month, massively improving cash flow and asset value.

What was the outcome?

The project exceeded expectations. We retained the original rental for cash flow and created a new luxury 5-bed, 5.5-bath home that leased up immediately for $2,750/month. The combined properties significantly increased our cash flow and equity position, all from a deal that started as a simple rental acquisition. It fundamentally changed my approach to how I evaluate lot sizes and zoning potential.

Lessons learned? Challenges?

The biggest lesson was understanding how critical local knowledge and relationships can be in unlocking hidden opportunities. Without my partner’s awareness of zoning and entitlement possibilities, we would have left the value untapped. The replatting process took time and required close coordination with city staff and surveyors, but the long-term upside far outweighed the temporary delays. I now evaluate every acquisition with “hidden lot potential” in mind.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We worked closely with a local lender who understood the value of the land and structured the construction loan creatively, allowing us to move forward with minimal additional capital. I’d highly recommend working with community banks or credit unions that are familiar with infill development and willing to think outside the box on deal structuring.