Sold $1,590,000 - Investment Property
Well, this may prove to be the most controversial email I have ever sent you. Getting you to believe that a 6-unit in Boyle Heights is a good deal (let alone a great deal!) and getting you to believe in the rents they will get (they’re currently all vacant except one) may be an interesting challenge. All I can do is ask, “Have I ever led you astray?” I think the answer is a resounding “No!”
“So, what about the rents?” you ask:
Well, the unit mix on this property is two 2-bed, 2-baths and four 1-bed, 1-baths. All of these units have high ceilings and period features. All of these units (except one of the 1-beds, which is the only one with a low-rent tenant and will not be delivered vacant) have been fully renovated inside and out by people well schooled in how to appeal to the Millennials who are invading Boyle Heights in droves. In short, the units are beautiful and fully brought into the 21st century while simultaneously retaining all that late 19th-century charm and character (built in 1895.) The photos tell most of the story, but they are no substitute for seeing it in person. I have the 2-beds, 2-baths at $2500/mo each and the 1-bed, 1-baths at $1700 each. Including the one low-rent tenant who is paying $450, that all adds up to $10,550.
However . . . I have not yet mentioned the approximately 2000 sq ft basement space that has full headroom and windows. When you consider that this property is commercially zoned, you can easily understand that one way or another, you have minimally another $2000/mo income in the basement. That now all adds up to $12,550. And this does not even talk about what a better deal it will be if/when you can relocate the one remaining low-rent tenant and renovate that unit as well.
There are 5 parking spots; there are downtown views; there is about a 3-minute drive or 15-minute bike ride to the downtown Arts District. Additionally, all these units are currently furnished (owners were doing Airbnb for a while) and keeping that furniture as part of the transaction is also negotiable.
Bottom line: Yes, you will get the rents I am denoting here. And when you do, you will have a property that will get you approximately $4350/mo in cash flow, and that is before you relocate the low-rent tenant! This equates to a whopping 10.8 % cash-on-cash return, with a lot of upside going forward. If you want it or know someone who might, I suggest you get in touch with me right away.
Best, Ken
