Updated about 2 months ago on .
30‑Unit Workforce Housing Portfolio – Western Kentucky (Under Contract)
Investment Info:
Large multi-family (5+ units) buy & hold investment.
Purchase price: $1,790,000
Off‑market 30‑unit townhome portfolio in Western Kentucky. Stabilized asset with 100% occupancy, 8.97% going‑in cap rate, separately metered utilities, and major CapEx completed by prior ownership. Clear value‑add runway through operational improvements and turnover‑driven rent resets. Currently under contract and in active due diligence.
What made you interested in investing in this type of deal?
I focus on stabilized B‑ and C‑class workforce housing in small Kentucky markets because these assets offer strong in‑place yield, predictable tenant demand, and operational upside without relying on aggressive rent growth assumptions. The town product in particular provides lower turnover, lower OpEx, and more resilient cash flo compared to traditional multifamily. This deal aligns directly with that strategy: stable occupancy, conservative upside, and a clear value‑add runway supported by mark
How did you find this deal and how did you negotiate it?
The deal was sourced off‑market through a local operator relationship built over time in the Western Kentucky sub‑market. We were able to move quickly because we maintain a digital‑first underwriting and diligence workflow, which allowed us to evaluate the asset, confirm the income profile, and validate the CapEx history efficiently. Negotiations focused on certainty of close, clean terms, and a timeline that worked for the seller rather than trying to win on price alone.
How did you finance this deal?
The deal is currently under contract and in active due diligence. The planned structure is a conventional senior loan paired with private equity through a joint‑venture arrangement. We focus on conservative leverage, strong DSCR, and ensuring the asset cashflows from Day 1 based on in‑place operations. Final capital structure will be set after completion of diligence and lender engagement
How did you add value to the deal?
The value comes from operational improvements rather than heavy renovation. The property is 100% occupied with legacy tenants, so the primary upside is through turnover‑driven rent resets, improved expense controls, and modernizing management systems. Separately metered utilities and completed CapEx reduce risk and allow for cleaner NOI growth. Our digital‑first oversight model also creates efficiencies with third‑party management from Day 1.
What was the outcome?
The deal is currently under contract and progressing through due diligence. Early findings support the underwriting assumptions around stabilized cash flow, conservative upside, and operational improvements. Outcomes will be determined after lender engagement and completion of diligence.
Lessons learned? Challenges?
Small‑market stabilized assets require a different underwriting lens than traditional value‑add deals. Legacy tenants can create slower rent‑reset velocity, so stress‑testing turnover assumptions is critical. Another lesson is the importance of verifying prior CapEx quality in 1970s construction. The challenge is balancing strong in‑place yield with realistic timelines for capturing upside.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Still in due diligence, so we have not finalized vendor or lender selections. We typically work with local operators, regional lenders, and third‑party management teams with experience in small‑market workforce housing.