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Hello Investors,
🔥 THIS WEEK
KC Chase & Cole 48-Unit: 4.33% assumable I/O = 24.8% CoC ($201K/year), 10.2% cap, $1.44M value-add upside
Raytown 12-Unit Fourplexes: 7% CoC BUT no PM, $79/unit rent gap, sub-metered utilities, 1980s clean
Vegas Clark 10-Unit: 5.1% CoC weak BUT fully renovated, zero capex 10 years, $6M 30-year equity
San Jose 4/3 Flip: $88K profit, $1.4M ARV requires premium execution, 194% annualized ROI
📝 Note on Numbers: Multifamily uses 25% down at 6-6.5%. San Jose flip uses 10% down hard money at 10.45%. KC Chase & Cole modeled at 6.5% conventional BUT assumable 4.33% I/O loan available nearly doubles cash flow.
🏢 KC Chase & Cole 48-Unit - 4.33% ASSUMABLE = 24.8% COC $201K/YEAR
📍 2700-2718 E 29th St, Kansas City, MO 64128
💰 Price: $2,900,000 ($60,417/unit)
🏠 Units: 15×1BR/1BA, 31×2BR/1BA, 2×2BR/2BA, 48 Total
🏦 Conv. CF: $130,649/yr (16.1% CoC) | Assumable: ~$201,407/yr (24.8% CoC)
4.33% assumable I/O = 24.8% CoC ($201K/year), 10.2% cap, $1.44M value-add upside
Key Metrics - CONVENTIONAL vs ASSUMABLE:
Critical Numbers | Conventional 6.5% | Assumable 4.33% I/O |
|---|---|---|
Down Payment (25%) | $725,000 | $725,000 |
Total Cash Required | $812,000 | $812,000 |
Loan Amount | $2,175,000 | $2,175,000 |
Monthly Payment | $13,747 | ~$7,851 |
Annual Cash Flow | $130,649 | ~$201,407 |
CoC | 16.1% | ~24.8% 🔥 |
Cap Rate | 10.2% | 10.2% |
Debt Coverage | 1.79x | ~3.14x |
Break-Even Ratio | 66.9% | ~50% |
Assumable 4.33% I/O Fannie Mae Loan GAME-CHANGER: In 6.5-7% rate environment stepping into 4.33% non-recourse interest-only loan on $2.175M balance = competitive advantage cannot replicate ANY price, monthly payment drops $5,896 ($70,752 annually) = NEARLY DOUBLES modeled cash flow
10.2% Cap Rate Elite KC: Already exceptional on 48-unit stabilized multifamily before touching assumable loan OR implementing ANY value-add lever, floor performance outstanding
Heavy Capex Already Done: New roofs, windows, exterior, breaker boxes, common areas completed = not walking into maintenance nightmare, prior owner absorbed capital expense you inherit benefit
100% Tax Abatement Through 2031: Property pays only $14,933/year PILOT payments versus $65-75K full market taxes = saving $50K+ annually in operating expenses protecting cash flow during value-add execution
$60,417/Unit Extremely Low: Kansas City emerging east side market strong rent growth fundamentals, buying at significant discount versus typical KC multifamily pricing
THREE Value-Add Levers NOT YET Captured:
$200/Unit Rent Premium Light Renovation:
48 units × $200 = $9,600/mo ($115,200/year)
At 10.2% cap = $1.13M additional asset value
Documented market comparables, executable not speculation
Utility Billback Program Not Implemented:
15×1BR @ $45 + 33×2BR @ $60 = $2,655/mo ($31,860/year)
Kansas City market standard, minimal friction capture
Pure NOI addition no capital required
Tax Abatement Advantage:
$50K+ annual savings versus unabated comparable
Persists through 2031 = 5+ years protection
Directly supports cash flow during execution
Combined Value-Add Math:
Rents to market + billback = +$147,060/year NOI
At 10.2% cap = ~$1.44M additional property value
All available through EXECUTION not speculation
Zero major capital improvements required
16.1% CoC FLOOR Not Ceiling: Day 1 conventional financing already exceptional BEFORE assumable loan benefit, before implementing ANY value-add lever, modeled performance understates reality
Non-Recourse Loan Protection: Fannie Mae assumable loan = personal liability protection matters on deal this size, institutional-quality financing structure
3.14x Debt Coverage Fortress: With assumable loan could lose HALF income still cover debt service = extraordinary safety margin, deal not fragile
10-Year Wealth Projection: $372,428 annual cash flow, $5.14M equity, 45.9% CoC = institutional-grade return profile, Year 10 IRR 24.8% on 48-unit KC asset
20-Year Trajectory: $568,920/year cash flow, $9.4M equity, 70.1% CoC = what multifamily wealth building looks like buying right in strong rental market letting time/leverage compound
Risk Level: LOW - Assumable loan dramatically reduces financing risk, heavy capex done eliminates maintenance risk, 100% tax abatement protects cash flow, value-add optional not required
Recommended Strategy: STRONG BUY - Verify assumable loan assumption process/fees (typically 1% Fannie Mae), qualify for assumption, execute on loan assumption FIRST (doubles cash flow Day 1), implement value-add levers over 2-3 years adding $1.44M asset value, 20-year hold builds $9.4M equity
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🏢 Raytown Lane Ave 12-Unit - 7% COC NO PM, $79/UNIT RENT GAP
📍 8622-8630 Lane Ave, Raytown, MO 64138
💰 Price: $1,250,000 ($104,167/unit)
🏠 Units: 12×2BR/1BA, Three Adjacent Fourplexes
🏦 Current CF: $24,482/yr (7% CoC) | At $1K/Unit: $35,289/yr (10.1% CoC)
7% CoC BUT no PM, $79/unit rent gap, sub-metered utilities, 1980s clean
Key Metrics:
Critical Numbers | Current | At $1,000/Unit |
|---|---|---|
Down Payment (25%) | $312,500 | $312,500 |
Total Cash Required | $350,000 | $350,000 |
Gross Rent | $11,052/mo | $12,000/mo |
Annual Cash Flow | $24,482 | $35,289 |
CoC | 7.0% | 10.1% |
Cap Rate | 7.4% | ~8.2% |
Debt Coverage | 1.36x | ~1.52x |
Sub-Metered Gas/Electric HUGE: Tenants pay OWN utilities = significant operating expense protection most KC multifamily doesn't have, saves $300-600+/mo versus owner-paid on 12-unit, no utility exposure
100% 2BR/1BA Uniform Product: All same unit type simplifies management/maintenance/leasing, uniform product means uniform turns, operational efficiency concentration
In-Unit Laundry Real Differentiator: Raytown rental market premium amenity, reduces vacancy justifies rent premiums versus coin-op buildings, tenants with in-unit laundry don't leave unless forced
1980s Construction Clean Era: Past problematic 1950s/60s systems, before oversized maintenance costs newer construction, copper plumbing modern electrical no asbestos concerns no knob-and-tube, capex profile manageable
$79/Unit Documented Rent Gap: Buying below $1,000/month current market rate with documented path close gap, $948/year per unit additional income available at normal turnover WITHOUT touching single unit
Three Buildings Portfolio Purchase: Concentration three fourplexes in row creates operational efficiency, one management relationship one insurance policy consolidated maintenance visits
6.0% Financing Below Market: Favorable debt structure relative current 6.75-7% environment, conservative modeling financing side
Value-Add Path Clear No Renovation:
Current ~$921/unit → $1,000 market = $79/unit gap
12 units = $948/mo ($10,807/year) additional income
At 7.4% cap = $146,000 added asset value
Just normal lease turnover NO capital required
$104,167/Unit Above KC/Raytown Typical: Chase & Cole priced $60,417/unit for context, Raytown solid suburb but price reflects 1980s construction quality and in-unit laundry premium, verify Raytown 2BR comps support
Higher-End Upgrade Potential: At $1,100-1,150/unit with modest improvements (vinyl plank, fixtures, paint) cash flow climbs to ~$48K/year approaching 13.7% CoC, runway exists beyond $1K baseline
Risk Level: MEDIUM - Modest Day 1 CoC requires self-management OR patience for rent growth, price per unit premium for market, BUT sub-metered utilities and in-unit laundry justify premium, clean 1980s product reduces capex risk
Recommended Strategy: BUY if self-managing KC-area investor, 7% CoC acceptable as floor knowing $1K/unit achievable through turnover improving to 10.1%, three-building operational efficiency valuable portfolio concentration, if requiring third-party PM stress test at 3.4-4.1% real CoC and determine acceptability
🏠 Vegas Clark 10-Unit - 5.1% COC WEAK BUT ZERO CAPEX 10 YEARS
📍 1101 E Clark Ave, Downtown Las Vegas, NV 89101
💰 Modeled: $1,750,000 (list $1,850K) | $185,000/unit
🏠 Units: 10×2BR/1BA, Fully Renovated 1954 Building
🏦 Year 1 CF: $25,081/yr (5.1% CoC) | Year 30: $6M Equity
5.1% CoC weak BUT fully renovated, zero capex 10 years, $6M 30-year equity
Key Metrics:
Critical Numbers | Year 1 | Year 10 | Year 30 |
|---|---|---|---|
Total Cash Required | $490,000 | $490,000 | $490,000 |
Annual Cash Flow | $25,081 | $62,268 | $191,252 |
CoC | 5.1% | 12.7% | — |
Property Value | $1,750,000 | $2,738,000 | $6,000,285 |
Total Equity | ~$438K | ~$1.64M | $6.0M |
Cap Rate | 6.8% | — | — |
Debt Coverage | 1.27x | — | — |
CRITICAL: Fully Renovated VALUE PROPOSITION: New HVAC (units + furnaces), full electrical rewire, full plumbing replacement, new gas lines, new water heaters, new kitchens/baths/flooring throughout = $200-400K avoided future capex would eviscerate unrenovated comparable
Real Cash Flow Higher Than Modeled: 5% capex reserve ($7,440/year) largely theoretical next 10-15 years on major systems, actual capex burn rate lower than assumed meaning true cash flow exceeds pro forma
Downtown Vegas Location Premium: 89101 Legal/Arts District corridor sustained reinvestment past decade, Fremont Street walkable amenities locals market, 2BR $1,240/mo has room grow as downtown continues trajectory
30-Year Equity Story: $6M equity on $490K invested over 30 years = real return story here, HOLD asset not cash flow machine, generational portfolio building play
6.0% Interest Rate Below Market: Model uses 6.0% versus 6.75-7% most deals this series, lower rate partially offsets thinner cap rate
78.1% Break-Even Ratio Tight: Expenses and debt service consume 78 cents every dollar earned, any sustained vacancy above 5% OR unexpected expense creates negative cash flow, cushion thin
No Value-Add Lever Remaining: Already renovated no rent upside through improvement, no billback program to implement, no occupancy to stabilize, what you see what you get, growth comes ONLY from market rent increases and appreciation
$185,000/Unit Premium Price: 1954 Las Vegas C-class building even fully renovated paying premium current income doesn't fully justify on paper, at $1,850K ask cap drops ~6.5% CoC falls ~4.6%
Recommended Strategy: CONDITIONAL - Negotiate HARD on price targeting $1,650-1,700K before committing, use fully renovated "no more upside" angle as leverage seller already priced renovation premium, if portfolio diversification Downtown Vegas exposure and zero-maintenance hold objective AND can get $1.65M this makes sense, if need cash flow to reinvest this WRONG deal for that purpose
🏠 San Jose War Admiral Flip - $88K PROFIT 194% ANNUALIZED ROI
📍 337 War Admiral Ave, San Jose, CA 95111
💰 Purchase: $998,720 | ARV: $1,400,000
🏠 4BR/3BA, 1,732 SF South San Jose
🏦 Profit: $87,668 post-tax (64.8% ROI) | Hold: 4 months
$88K profit, $1.4M ARV requires premium execution, 194% annualized ROI
Deal Economics:
Hard Money Structure | |
|---|---|
Purchase Price | $998,720 |
Rehab Costs | $159,500 |
Hard Money Loan | $1,058,348 @ 10.45% |
Down Payment (10%) | $99,872 |
Purchase Costs | $29,962 |
Total Cash Required | $129,834 |
Monthly Carry | $9,808 (IO + holding) |
Profit Analysis | |
|---|---|
ARV | $1,400,000 |
Selling Costs (4.5%) | -$63,000 |
Loan Repayment | -$1,058,348 |
Holding Costs (4mo) | -$39,233 |
Cash Invested | -$129,834 |
Total Profit | $109,585 |
Post-Tax Profit | $87,668 |
ROI | 64.8% |
Annualized ROI | 194.4% |
$129,834 Cash-In Outstanding: Controlling $1.4M ARV asset with minimal personal capital, hard money doing heavy lifting, exceptional capital efficiency
4/3 Configuration Right Product: Genuine demand families and investors 95111, thin comp supply ALSO upside argument = less competing inventory at listing, specific product for zip
194.4% Annualized ROI Legitimate: Even stress-tested at 6 months still 95.4% annualized, 8-month bear case generates $56K post-tax showing deal has real cushion
75.6% LTV Conservative: Market softness doesn't create lender problem, structural protection adequate downside scenario
CRITICAL: $1.4M ARV Execution-Dependent: Direct comps 175 Page Mill Dr ($1,138K) and 5112 Edenview Dr ($1,120K) same exact SF/bed/bath sold $647-657/SF, $1.4M ARV at $808/SF requires $150+/SF renovation premium = 23% premium for renovation quality
ARV Requires Premium Finish Quality:
Page Mill/Edenview $1.12-1.14M = reference point every buyer's agent pulls
Your renovation needs tell clear story WHY worth $260K more
Kitchen/baths/street presence three things justify it
Execution-dependent ARV works ONLY if finish quality visibly premium
$159,500 Rehab Budget $92/SF: Solid mid-grade renovation budget covers kitchen $35-50K, 3 baths $25-40K, flooring $15-20K, paint $8-12K, landscaping $10-15K, permits/contingency $10-15K, consistent clean well-executed cosmetic NOT gut rebuild
4-Month San Jose Permit Reality: If any scope requires permits (structural, electrical, HVAC) Santa Clara County timelines can extend beyond 4-month model, know permit exposure before start
8-Month Scenario Still Profitable: $56,281 post-tax at 8 months shows deal doesn't blow up on timeline slip just compresses, cushion you want on flip
South San Jose Fundamentals Strong: 95111 high-demand supply-constrained South Bay submarket, quality renovated product moves, market liquid for right execution
Risk Level: MEDIUM - ARV requires premium execution clear comp gap, 4-month timeline ambitious for permits, rehab budget tight, BUT capital structure efficient and holding period sensitivity shows durability
Recommended Strategy: BUY - Get contractor scope validated against $159,500 budget BEFORE offer, confirm permit exposure doesn't extend timeline, hit kitchen/baths at genuine A-minus standard, present clean landscaping/exterior, $1.4M buyer shows up IF execution premium separates from $1.12-1.14M comp range
Disclaimer: The content provided through Dealsletter, including investment metrics, property analysis, and rewards materials, is for informational and educational purposes only. It does not constitute financial, legal, or investment advice. Always conduct your own due diligence or consult a licensed professional before making any investment decisions. Dealsletter assumes no responsibility for any financial outcomes resulting from actions taken based on the information provided.