Help evaluate apartment complex - Posted by John
Posted by John on October 21, 2003 at 09:29:09:
Limited details on 36 Unit Apartment complex. Bought 1997 for $919,000 now for sale $825,000. All 2br 1 ba apartments with rent at $425/month. Has pool for tenants. About 10 units have W/D hookups. Taxes $15,700/year.
This is divorce sale, property has not been cared for carefully since divorce, two of the buildings need new roofs, several windows need replaced, parking lot needs some attention, Could use some painting. Sets among other condo/townhouse/apartments with rents from $400-$600/month. Owner/agent says not aware of other deferred maintenance, but what management is taking place is performed by ex and ex’s manager. Is in a stable area, low crime, nice setting. Sets about 1/4 to 1/2 mile from commercial strip of predominatly new and several used car dealers and several small strip malls. During peak vacancy supposedly at 5% or less now much greater. Tenants pay utilities. Existing debt is less than asking price. Price reflects debt plus realtor commission.
Property was appraised in 1999 for $1.1 million. Is this a decent property upon which to spend the time for due diligence?