Looking for financing on a Multifammily

[Jason Elskamp]

 

Executive Summary

 

Silvernail Apartments

333 & 400 Buchner Place

La Crosse, WI  54603

 

 

 

 

 

By Elskamp Enterprises, LLC

915 Logan Street, La Crosse, WI  54603

 

 

 

 

 

 

 

 

Property Discription

333 Buchner: 3 Story Building built in 1973 with 64 apartments on 2^nd & 3^rd level and offices on 1^st Level, 63 efficiencies and 1 one bedroom with 32 units on each floor.  56 units have been renovated 8 are older units.  1^st level has 4 wings with 3,320 Sq Ft each; Head Start occupies 3 wings and an insurance agency occupies 1/3 of the forth wing, other 2/3 is currently vacant.  This building has 48,204 Sq Ft with 39,840 Sq Ft rentable.   Features of this building include: 5 pair coin-operated laundry machines, pop and vending machines, underground Sprinkler System, Complete fire alarm system.  Total Parcel land area is 102, 200 Sq Ft.

400 Buchner:  2 Story Building built in 1973 with 30 apartments on each level. 58 one bedroom (20 large with patio or balcony and 38 small) and 2 efficiencies. 48 units have been renovated and 12 are older units.  This building has 37,324 Sq Ft with 29, 868 Sq Ft rentable.  Features of this building include: 5 pair coin-operated laundry machines, pop and vending machines, and underground sprinkler system.  Total Parcel land area is 63,237 Sq Ft.

Property Summary:  2 Properties consisting of 124 apartments and 3 Commercial units.  Total Sq Ft of both buildings is 85, 528 with 77,164 rentable of which 13,280 is rented as commercial.  Total land area is 165,437 Sq Ft.  Tenants pay heat and electric in both buildings.  The Larger Commercial Tenant (Head Start) has signed a 5 year lease on June 1, 2010 and the rent is increased yearly by the Cost of Living.  The Seller has reported a historical vacancy rate of 1.5% in the last 3 years.

Gross Operating Income:                   $695,847

Operating Expenses:                           $251,890

Net Operating Income:                       $443,957

Plan for the Property

I plan to renovate the remaining apartments and increase rents as well as bring up the undermarket rents to market rates.  I also plan to rent the 2,200 Sq Ft of vacant office space at $10/sq ft to increase rents by $22,000 for potential NOI of $465,957.  I can also easily revert this area back to 6 efficiencies for little investment with potential income of $27,000 which would increase the NOI to $470,957.  The idea of reverting back to efficiencies has been verbally approved by the City of La Crosse Inspections Department, as well as the other commercial units if it were needed in the future.

Sources and Uses of Funds

The purchase price of this property is $5,300,000.  I am looking for funding of $4,717,000.  The seller is holding a 2^nd mortgage of $530,000 at 6% interest armoritized over 30 years with a 5 year term.  The remaining $53,000 will be invested by Elskamp Enterprises, LLC (Principle).  This investment will be from commission proceeds from the sale as I am a Real Estate Sales Agent.

Exit Strategy

I plan to acquire the property as a long term investment.  My plan is to realize the potential income once all loans are repaid and is owned free and clear.

 

 

 

Management Team

There is currently an office manager on payroll with this property to handle the day to day tasks, as well as cleaner and painter.  I plan to retain those employees after the purchase and I will be handling the majority of the property management of which I am experienced in.  I was the primary care taker of a 277 unit apartment complex for 4 years and currently own 12 properties with 26 units that I have maintained and managed for the last 5 years.

Financial Highlights

 

Income: Annual Rents Vacancy Other Income Gross Operating Income:   Operating Expenses: Real Estate Taxes Repairs Management Refurbish Expenses Insurance Utilities Advertising Supplies Water / Sewer Trash Total Operating Expenses:   Gross Operating Income: Expenses: Net Operating Income:

2010 Actual     $684,624 $10,269 $21,492 $695,847     $111,363 21,634 28,793 6,527 9,690 43,445 6,604 3,083 9,881 10,870 $251,890   $695,847 $251,890 $443,957

2011     $684,624 $10,269 *$43,492 $717,847     $111,363 21,634 28,793 *25,000 9,690 43,445 6,604 3,083 9,881 10,870 $270,363   $717,847 $270,363 $447,484   *  Office Space Rented.   *  10 Units Renovated

2012     *$704,964 $10,574 $43,492 $737,882     $111,363 21,634 28,793 *25,000 9,690 43,445 6,604 3,083 9,881 10,870 $270,363   $737,882 $270,363 $467,519   *  Rent raised to Market   *  10 Units Renovated

2013     $704,964 $10,574 $43,492 $737,882     $111,363 21,634 28,793 *6,527 9,690 43,445 6,604 3,083 9,881 10,870 $251,890   $737,882 $251,890 $485,992   * All units Renovated

[Jamal Morris]

Hello Jason, please give me a call.

800.447.4125 ext. 101

 

[Paul Lepine]

Jason; I am a career, West Point, Army Colonel and now manage Thornbush Capital Partners, LLC.  Over and above the normal negotiated brokerage, we also offer a ¼ point incentive to professionals who bring us opportunities that align with our lending parameters and actually close escrow.

We are primarily a private, direct, hard money lender specializing in 1 to 3 year bridge loans on performing commercial assets and we lend from $1MM to $50MM.  We openly post rates (13% avg, 2-3 points), fees, and terms (up to 75% LTV), charge NO UPFRONT FEES to review submissions, and close in 30 days. 

 

We would be interested in reviewing future, performing, multi-family lending opportunities.

 

[e-mail]

307-256-2851

[Phillip Walker]

Hi Jason,

 

I have a variety of lenders who can finance this project for you. Please contact me at [e-mail] or call at 510-575-1709.

[Michael Allen]

Hi Jason,

Thank you for the project breakdown.  After my review, I am very interested in speaking with you this coming Monday.  Do send me an email at [e-mail] with you're availability.  You may also contact me directly at 425.218.4233.

 

Thank you Jason, and I look forward to our discussion.

 

Regards,

Michael Allen