Refinancing a 20-unit turnaround, eight years in
Chris is completing a cash-out refinance on a building he bought distressed and 60 percent occupied in 2018. Today it is 95 percent occupied and worth roughly four times its purchase price.
Chris Monsour
Co-Founder · Operations & Technology
| At purchase, 2018 | Today | |
|---|---|---|
| Value | $550,000 | About $2,000,000 |
| Average rent | About $550 | $900 to $1,100 |
| Occupancy | About 60% | 95% |
Figures are approximate.
This month Chris is completing a cash-out refinance on a 20-unit apartment building, his first refinance on a commercial property. It is a milestone eight years in the making.
How it got here
When Chris bought the building in 2018 for $550,000, most buyers had already passed on it. It was roughly 60 percent occupied, rents averaged about $550 a unit, and it needed real work. That is exactly the kind of property StratumVest is built around: too small for an institution to pursue, and too demanding for most individual investors to take on alone.
Today the building is 95 percent occupied, with rents between $900 and $1,100. It produces more than six figures of net operating income each year and is valued at roughly $2 million.
Why refinance instead of sell
A refinance lets an owner draw capital back out of a building that has grown in value without selling it. The tenants stay, the income continues, and the capital is free to go to work again.
It is also an honest test of the original thesis. A lender advances money only against a building that performs, on paper and in person.