Built in the 1960s, the Sheila Apartments consists of (12)1-bedroom units and (2) laundry rooms and is located close-in NE Keizer, Oregon.
Buyer used 1031 funds plus additional cash to purchase this property. The buyer was looking for a property with cash flow and liked that this property had upside in the rents. Most of the client’s portfolio is comprised of 1-bedroom units so this purchase fit comfortably within it. The buyer estimated an approximate $100 per unit rental upside.
There was a significant amount of deferred maintenance and financing became difficult when the bank requested a long term life span on the roofing. The seller agreed to fund $45,000 worth of repairs prior to closing which included the roof, interior repairs and painting. The buyer was prepared to invest in improving the property upon purchase as well. The buyer undertook the task to upgrade the electrical boxes and to completely excavate and repave the asphalt in the parking lot. The deal took four months to close since a scarcity of available vendors stalled the bidding process and delayed implementing the repairs.
The property will be significantly renovated. The tenants will have a more comfortable, updated living environment and the community will be free of a very dilapidated structure.