Purchase Cost: $220,000

Renovation Cost: $32,800

Total Cost: $252,800

Strategy: Value-add

Our long-term strategy is to capitalize on the growing Columbus market by renovating and stabilizing both units for maximum rental income. We have the advantage of inheriting an existing tenant in Unit 258, who has expressed interest in renewing their lease at the end of its term. Our immediate focus will be on renovating Unit 260 to achieve top market rent. Concurrently, we will gradually adjust the rent for Unit 258 to market levels, depending on the tenant’s decision to stay or vacate. This approach ensures a balanced and profitable investment, optimizing returns in a dynamic market.

In the short term, our strategy is to renovate one unit and follow with the other, enhancing property value and rental income. We successfully completed the renovation of Unit 260 in September 2024. We are also in active discussions with neighboring property owners to explore other potential acquisitions in the area. Securing these neighboring properties would unlock significant additional value, creating a combined opportunity with enhanced visibility and modeled returns. This strategic move positions us to capitalize on the strong market dynamics in Franklinton, further maximizing our investment potential.

The Columbus real estate market is experiencing rapid growth, with property values increasing by an average of 8% annually. The area surrounding the property benefits from a strong rental market, with occupancy rates consistently above 95%, driven by demand from young professionals and families. This property's location offers excellent access to major highways, schools, and popular shopping districts, making it highly desirable for long-term tenants. The neighborhood is known for its stability and community atmosphere, further enhancing its appeal and ensuring continued appreciation and demand.

Focus is on attracting qualified long-term tenants at market rates, ensuring stable and consistent rental income. However, we are also exploring the growing demand for nonprofit organization offering homelessness prevention and supportive housing services. In the long-term, we are considering partnering with the Homes for Families Foundation, which offers master leases with guaranteed payments, regardless of occupancy. This option provides an attractive alternative, though certain qualifications must be met. These are currently under consideration as we assess the viability of integrating this model into our tenant strategy to enhance both occupancy and financial security.

Our long-term strategy involves holding the property while maximizing its financial performance. In the next 6-8 months, we plan to refinance at 60% Loan-to-Value (LTV) as interest rates continue to decline, offering liquidity to reinvest or distribute. While selling the property post-stabilization remains an option, our focus is on leveraging a cost segregation analysis to enhance tax efficiency within our investment model. Refinancing is the preferred route, providing flexibility and liquidity while allowing us to capitalize on market conditions and preserve the property’s long-term appreciation potential.