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Case Studies

August 7, 2020

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Multifamily Case Study: 26 Units in Leesburg, FL

The property was built in 1974 and went through a complete structural remodel...

26 Units

Highlights: The property was built in 1974 and went through a complete structural remodel in 2010. It is comprised of 8 buildings nestled in a quiet neighborhood in Leesburg. Each unit is a one bedroom, one bath layout with a private rear patio. Leesburg is a thriving city located in the Orlando MSA and is one of the fastest growing communities in Florida. The site is minutes away from the Villages, one of the nations largest 55 and over communities, and is within a mile of shopping, dining, and entertainment. The area is known for its many large spring feed lakes and hammock oaks making it one of Florida’s prime retirement communities.

Repositioning: The property will be acquired $1,800,000. An additional $150,000 to $200,000 will be invested into unit upgrades, improved signage, and landscaping. The current owner has done little to maintain the property but because of the demand occupancy has been 100%, however the current rental rate is well below the market average. We do the upgrades immediately to improve curb appeal. We will then focus on unit improvements that will be coordinated with lease terminations so we will be able to maintain cash flow during the upgrade process. Fortunately, the newest lease is 6-month-old so this will allow us to reposition all the units within 7 months. By adjusting the rental rate to market level, we will increase Net Operating Income by $38,000 in year one which will translate into an increase in value of over $500,000.

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February 14, 2018

4 min read

Real Estate Valuation: Cap Rate and Return on Cost Decoded

While they both provide valuable insights, their application...

As we continue to explore the fascinating realm of real estate investing, we shift our focus today to two crucial metrics used in assessing the value and profitability of real estate investments - Cap Rate and Return on Cost. While they both provide valuable insights, their application and significance can be quite different. Let's untangle these terms and understand how to use them effectively.

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