5 plex development on the river

[Chris Smith]

Investment Info:

Large multi-family (5+ units) other investment.

Purchase price: $1,250,000
Cash invested: $1,250,000
Sale price: $1,250,000

First development, really ignited a "gentrification" of this downtown area.

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

Family had capital, I was a builder

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

Friend was a realtor

How did you finance this deal?

Cash, family money

How did you add value to the deal?

built a 5 plex

What was the outcome?

broke even

Lessons learned? Challenges?

Didn't know we would have to build a "Sea Wall" along riverbank which would cost 250K. Took all the profit out of the deal. Prices in this depressed area weren't proven. We were the test market. Raised prices on each sale, but still didn't realize we could have charged much higher prices.