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  • chadmschieler

Case Study: Sugar Hill Apartments | Crawfordsville, IN

This property was acquired in November 2021, our 2nd acquisition. 


We acquired this property off-market from a long-time owner. The property had major deferred maintenance and non-paying tenants. We set out to resolve all outstanding capital needs, renovate every unit, rebrand and re-tenant the entire property to bring up to market standards.


 


High-Level Business Plan Summary:

  • Resolve all exterior and interior deferred maintenance

  • Full renovation of every unit

  • Upgrade laundry room

  • Convert (1) 2 bed unit to a 3-bed unit

  • Full Rebrand and Re-Tenant


Photos Before:


Photos After:





Renovation & Improvement Scope:

  • Full Interior Renovation:

    • LVP Throughout

    • New Appliances

    • Painted Cabinets, New Hardware & New Countertops

    • New plumbing and light fixtures

    • New In-wall A/C Units

    • Conversion from boiler to baseboard heaters

    • Bathroom remodel including shower, toilet, vanity, accessories

    • Subfloor replacement as needed

    • Mold Remediation

  • Removal of overgrown landscaping, new landscaping added

  • Concrete paths to entry doors

  • Roof Repairs

  • Addition of dumpster corral and concrete pad

  • New Property Signage and branding

  • Renovated Laundry room with new washers & dryers

  • Updated all Electrical Panels and circuit breakers to bring up to code

  • Resolved plumbing leaks and drainage/sewage issues


 





Obstacles Encountered | Lessons Learned:

  • Review the Inspection Reports thoroughly - we would have retraded/negotiated a discount had we known the extend of the deferred maintenance prior to acquisition.

  • Contractor Agreements - we lost ~$30k to a contractor due to improper funding/draw schedules, poor construction agreements, and inspection intervals

  • Construction Budget - Had we known of all of the capex needs, we would have budgeted far more to complete the business plan. We personally funded the property with the additional capital to complete the work.

  • Property Management - we used a PM company that had experience with single family homes, but not well-versed at multifamily, resulting in higher vacancy and poor marketing/lease-ups.



 







Financial Results:

  • Purchase Price: $775K

  • Sale Price: $1.25M

  • Invested Capital: $347,959

  • Return of Capital & Cash: $460,720

  • Total Return on Investment: $112,761


Equity Multiple on Invested Capital: 1.32x

Average Annualized Return: 16.20%


 


We are Focused on Growing Your Wealth So That You Can Do What You Love



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