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You tell me what to do with $375,000.00

lang409

By lang409
in Grand Rapids

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lang409 Crossroads

lang409

Posted
Posted

Hello all - I am a private real estate investor here in Grand Rapids. I am very interested in buying and renovating housing in the metro GR area specifically for students and post graduate people. I am currently looking on the west side in the SWAN/John Ball area - but I am not limiting myself to just that area.

Please tell me what you think would work -

Should I concentrate on multi-family units, single family houses?

What amenities MUST we have for you to rent?

What rents are reasonable?

Is off the street parking ok or do you have to have a driveway?

Does it matter how old the building is if it is renovated?

What areas of GR need student housing?

Sound off!!!

My money is in your hands GR

I have allocated $375,000.00 to this project and I need you to tell me how to turn into housing you want.

I will respond to your posts and your questions and keep up to date as to how things are developing on this thread

Tell everyone you know about this post and lets get some information going here

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GRDadof3 Ecumenopolis

GRDadof3

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Welcome lang409!

A similar thread was posted on here a while back, that got over 100 responses to it:

http://www.urbanplanet.org/forums/index.ph...porary&st=0

I assume you mean you're investing $375K as equity, say 10%, on a $3 - $4 Million project? Contemporary and modern style apartments seem to be pretty well received with this crowd.

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AlexPKeaton Burg

AlexPKeaton

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It sounds like you're looking to put money into existing housing, is that correct? I'm sure whatever you do so long as you clean up some of the properties on the west side your investment will be well-received. If you're looking to build new student housing it might be good to look into building apartments that front Fulton with street-level stores. It would help better define the street wall there. There was a project proposed on Lake Michigan Drive on the west side that was exactly like what I'm describing, but there were some zoning issues with it and I don't know what the current status is.

Unfortunately Grand Rapids doesn't have the critical density yet to truly expect many people near downtown to give up their cars, so expect to provide off-street parking. Especially with students where you may have 4 cars associated with one house.

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NorthCoast Hamlet

NorthCoast

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The more affordable AND attractive (well maintained) housing around the immediate area of GVSU's Pew Campus, the better. The campus connector and Rapid provide adequate transportation opportunities. If I was looking into a project such as this I would definitely make an attempt to somehow incorporate some commercial development to re-vitalize the area, especially along Fulton.

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concretepoem Whistle-Stop

concretepoem

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Assuming you are looking at buying existing multi-families or single families, here's my two cents, speaking from experience:

Should you concentrate on multi-family units, single family houses?

There's a big difference between undergrad life and post-grad life. If you're going to put undergrads in a multi-family building, you'd better make sure all the units are rented to undergrads.

Otherwise, you're better off renting renting out SFHs to well-screened undergrads. The key is ample off-street parking, or you'll have issues with your neighbors. Keep in mind that a lot of times undergrads only want to rent from Sept-May. Turnover's very high. They expect the landlord to drop the rent over the summer, with maybe one tenet occupying the place during time.

If it's a neighborhood that's still a neighborhood, with a large amount owner-occupied housing, and maybe even a home-owners association, you're not going be very popular if you try to buy up a string of homes on a single street. Within the context of an existing neighborhood, student housing, especially sfhs aimed at undergrads, is not what most neighborhood associations are excited to see moving in.

What amenities MUST you have for you to rent?

Parking. For co-eds (that's old school for women students) the bedroom/bathroom ratio is a big deal. 2 bed/2baths are ideal. In unit laundry is also a big feature. Closet space is also a critical item, especially for co-eds.

What rents are reasonable?

$250-300/mo per bedroom seems to be the key number for undergrad housing. Post grads, especially if it's a couple and one of them has a real-world job, they can sometimes afford to pay more, but not much more. $500 per bedroom is the upper limit for a lot of grad students.

Is off the street parking ok or do you have to have a driveway?

Off-street is a big plus. Avoid places with 'shared' driveways. Places with a garage command a premium of as such as $50 a month per stall.

Does it matter how old the building is if it is renovated?

No. As long as it's safe and sound. And that's the challenge. It costs big dollars to do up an old house right. Another thing: with a multi-unit, you'll quickly have City inspectors on you about bringing your units up to the standard where they'll issue you an Occupany Permit.

What areas of GR need student housing?

With the various campuses dispersed throughout the city, the students are also spread out, from the East Beltline to the West side. It would be great to see at large concentration of students life having a positive impact on a specific area that's already got some cool stuff happening, but could use a boost. West Leonard. Fulton and Diamond.

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Veloise City

Veloise

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If I were doing research on this, I would start with the on-line classifieds. It's not difficult to tell how long something has been on the market, and if you arrange to go visit, the reasons why.

Seems like a renno on an existing structure could achieve a CO long before new construction would. If you bought several properties, you could fix up the best one and have some positive cash flow while working on the lesser lights. If I were doing this, I would see about acquiring an entire block, and perhaps tearing down the rattiest firetrap to provide a shared parking lot.

Keep in mind the school cycle. Kids will look for a place the previous spring and move in for fall. As someone else typed, summers can be very dead.

My own criteria (it's been a few years since college, but I was recently a grad student): off-street parking, closet/storage space, responsive management that does something more besides mow the lawn on the first of the month.

(Rant: I should not have to call the city to get the furnace repaired or a hazardous condition fixed.) Moved out of my last place because the new LL would not repair the fridge. Moved out of a previous one because the LL gave me about 20 minutes notice about a roof re-do, telling me that I would have to leave for the day (and everything I had in the attic acquired a dusting of shingle parts). Moved out of another place because the LL, who lived upstairs, had Saturday dawn meetings, and that meant she had to vaccuum at 5:30 am. Common sense and courtesy is a plus. If you don't have property management and people skills, hire someone who does.)

And I think I would leave the provision of undergrad housing to the U. Front-lawn parking, loud parties, couches on the porch, ugly banners in the windows, holes punched in the walls, six-pack rings all over the property, garage band practice, pot...yes, I lived in Ann Arbor for a long time.

HTH

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gvsusean Burg

gvsusean

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I will rent from you (and im looking right now) if: rent (with utilities (including basic cable and HIGH speed internet)) is no more than $325 a bedroom. (i want a 2 bedroom place) The place needs to be relatively safe i.e. by the zoo would be GREAT. For parking off-street would be fine for students but realize that EACH student could very well have a car. Do not need a furnished unit. Make a nice complex... density is AWESOME. If youd like me as a tennant send me a message ;)

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AlexPKeaton Burg

AlexPKeaton

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I doubt it would be profitable to rent for $350/month including ALL utilities unless you're looking at 4 bedrooms maybe. Or, subtract cable and internet for a 3 bedroom place. I'm thinking in terms of houses here more so than buildings where cable and internet makes more sense to be the tenant's responsibility anyway.

I charge my roommates $400 and $350 respectively for rent which does include wireless internet and basic basic cable (and water, gas, electric, and trash) and I still pay probably $350 out of pocket to cover all the monthly expenses. So to break even on a 3 bedroom place I'd need about $1,100 monthly if I included all utilities. Without utilities I'd break even around $900.

Of course some of that goes to equity in my house, and the interest is tax deductible, which means break even isn't too bad but any real estate investor is going to want positive cash flow. It works out great for me because I can live dirt cheap and still get the advantages of home ownership.

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lang409 Crossroads

lang409

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It sounds like you're looking to put money into existing housing, is that correct? I'm sure whatever you do so long as you clean up some of the properties on the west side your investment will be well-received. If you're looking to build new student housing it might be good to look into building apartments that front Fulton with street-level stores. It would help better define the street wall there. There was a project proposed on Lake Michigan Drive on the west side that was exactly like what I'm describing, but there were some zoning issues with it and I don't know what the current status is.

Unfortunately Grand Rapids doesn't have the critical density yet to truly expect many people near downtown to give up their cars, so expect to provide off-street parking. Especially with students where you may have 4 cars associated with one house.

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lang409 Crossroads

lang409

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The more affordable AND attractive (well maintained) housing around the immediate area of GVSU's Pew Campus, the better. The campus connector and Rapid provide adequate transportation opportunities. If I was looking into a project such as this I would definitely make an attempt to somehow incorporate some commercial development to re-vitalize the area, especially along Fulton.
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lang409 Crossroads

lang409

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I will rent from you (and im looking right now) if: rent (with utilities (including basic cable and HIGH speed internet)) is no more than $325 a bedroom. (i want a 2 bedroom place) The place needs to be relatively safe i.e. by the zoo would be GREAT. For parking off-street would be fine for students but realize that EACH student could very well have a car. Do not need a furnished unit. Make a nice complex... density is AWESOME. If youd like me as a tennant send me a message ;)
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lang409 Crossroads

lang409

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I seem to remember American Seating at about $350-400 per bedroom including no utilities and they had no problems keeping it full of students. I think that is the price point for the apartments going in on Grandville as well. $350/mo with all utilities seems unreasonable unless you're living w/ a friend who owns the home (ie AlexPKeaton) or on heritage hill. I haven't done a lot of searching, but that's my intial feeling.
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