First commercial deal NEED ADVICE PLEASE!!
Hi
I found a building that was converted from a senior living facility into a band-practice facility. The rooms have been soundproofed and are rented to bands to practice and store their gear. It's in a city known to be a breeding ground for new bands. There are roughly 90 units and it has been 100% occupied for the past 3 years. It sits on roughly 7 acres in a mixed residential neighborhood. Evidently, its in a 100 year flood plain and raises some issues with developing the rest of the land.
Asking is 1.7MM with $150K down, seller-financed. And he's already said he's negotiable on the downpayment. It grosses ~$17K/month and cash flows approx $5K after debt service.
My plan is to see if I can get it for 1.4-1.5M and assign it. If I could find the $150K, I'd buy it and keep it for cash flow, but I haven't had much luck and I don't want to get hard money since its my first deal and I'm not ready to tread those waters.
Questions–
1. Given this info, does it sound like a good deal?
2. Since its seller financed, I can't really put a contingency about finding financing, can I? I want to get it under contract and then find a buyer to flip it to and I think I'll need some time to do it and a way to back out if I can't locate one.
3. What am I missing?
Thanks in advance!