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126 E Broadway

Before Rehab

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After Rehab 

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Details:
 
Address: 126 E Broadway, Mishawaka, IN 46545
Project Type: C+, SFR, Rental
Purchase price: $28,599
Rehab cost: $41,000
ARV: $91,800
Date of Purchase: 08/24/2015
Projected timeline of completion: 3-5 months
Ground Partner: Steve Shaffer
Company: Reliable Properties of Michiana, LLC
Contact details: reliableproperties@yahoo.com; (574) 217-7839
 
Documents:
 
AddressProperty typePurchase PriceRehab costARVDate of PurchaseProjected timeline for
refinance or sale
126 E Broadway, Mishawaka, IN 46545C+, SFR, Rental$28,599$41,000$91,80008/24/20153-5 months
Date of SaleSales PriceCoCAnnualized
ROI
% Difference of Projected
vs Actual ARV
% Difference of Projected
vs Actual Rehab
% Difference of Projected
vs Actual Timeline
Source of
Funds
 
Timeline:

07/2017

Selling EAC properties due to low appraisals to get our investors paid off on these properties.

05/2017

Hope to complete by end of June.

04/2017

EAC is working to re-appraise then bundle with two other properties

03/2017

Remaining properties needing refinancing: EAC is working on alternative methods of financing (other
institutions and private investors). Working through details with one solution, but if any investors are
interested in fully amortized loan, paying 8% quarterly, please email Vil (vnikollaj@eacgp.com).

02/2017

Refinance in progress. Appraisals performed on subset of properties Feb 21, 2016. We hope to have these all completed by Feb/Mar timeframe.

01/2017

In process of securing long-term financing on all remaining properties in this market. EAC will be doing a combination of institutional financing, personal loans and new mortgages based on value and lender criteria. This is long overdue and we hope to have these all completed by Feb/Mar timeframe.

11/2016

We are currently looking at American Colony Financial and US Bank for refi on this property. We were turned down by Blackstone. Our plans are to refinance by the end of the year but because of the upcoming holidays, realistically we are looking at first quarter of 2017.

09/20/2016

We are still in the middle of the refinance of 126 E Broadway as well as several other properties. 126 E Broadway is also rented and the appraisal for this and all of the other properties is being scheduled this week. Realistically, we are still several weeks away from completing the refinance due to the delays on the 4-plex. Once the appraisals are completed we will have a better time-frame for an actual refinance date.

06/21/2016

Rented

06/07/2016

Completed with a tenant in place. Refinancing will begin within weeks with Colony American Finance. We are just waiting on the 4-plex at 226 Cleveland, which is nearing completion.

05/17/2016

Pending move in June 1, 2016

05/03/2016

Scheduled for completion mid May. Pre-rented with move in upon completion

04/19/2016

Tenant scheduled for move in May 15, 2016

04/05/2016

Painters scheduled for completion of paint and drywall work April 10, 2016

03/08/2016

Drywall repair, mechanicals, painting scheduled

02/23/2016

Scope of work moving forward, rental market projected end of March

02/09/2016

Cleanup starting with end of March projection for occupancy

01/26/2016

Initial scope of work moving forward for March 2016 rental potential.

01/12/2015

Unit moving forward and schedules set.

12/29/2015

Under construction and moving forward.

12/15/2015

No action being taken on the project at this time, mid January to begin flip on this property.

12/01/2015

Project is in the process of being evaluated for material and expected completion date.

11/03/2015

I have several feelers out with both local and national lenders and should be rate and term sheets from them this week. I am exploring both portfolio loan products and individual FHA / conventional loans for all of our properties there.

10/20/2015

We have had delays on our recent Indiana projects, and as such I felt it was critical to use my time there not only to build relationships and learn more about the area, but to evaluate our contractor, Mike Smith. Because my construction knowledge is limited, Lou Ellis offered to fly up with me so he could help me in this regard, and I’m sure glad I accepted his offer.

We started by touring all of our projects (16 in all) with our Ground Partner, Anthony Mwangi, to get a sense of the neighborhoods, the homes, and the workmanship. Most of these homes are occupied and cash flowing, so only a drive-by was possible.

But we have two SFRs which are completed and still on the market to rent, and having just come from our Jacksonville rehabs I could immediately spot shortcomings in the rehabs. These homes just were not finished to the quality we come to expect when EAC rehabs a home. The kitchen cabinets were refinished rather than new, the interior doors had mismatched hardware, and baseboards were uneven and contained gaps. These and other somewhat small details aren’t obvious in pictures, but when standing in the home the impression is not up to our standards. In order to maximize our rental income and refinance appraisal, these will require some additional work, something we’ll be completing in the next two weeks at EAC’s expense.

Moving on to the 4-plex and duplex that are slated for a rent-by-room model, we found similar issues with Mike Smith’s work on these projects. Lou was concerned about some framing and HVAC issues he saw, but because Lou doesn’t know the local codes we decided to call the city (Mishawaka) for an inspection. To make a long story short, the inspector agreed with Lou and some of this work will have to be redone.

After much discussion with Kevin and Lou, we decided that it was in our best interest to remove Mike Smith from these projects. This bold decision was made much easier by the fact that Lou offered to take over all of the Indiana projects as GC and see them through completion. We found out that earning a GC license in Mishawaka / South Bend is extremely easy and inexpensive (perhaps part of the problem!,) so Lou has already taken this step.

In the few days since my return, Lou has lined up some excellent subs and a good crew that will help us finish these projects quickly. I cannot express how impressed I am with him … once the decision was made he just took over and has everything in control. Kevin and I are so appreciative of his attitude and skills when it comes to being and effective GC, but moreso as a phenomenal Ground Partner, and frankly, a great friend. He saw that we needed help and took charge to make things right.

Lou will be working his weekends and Monday in Jacksonville, and then flying to South Bend Monday night to spend most of the work there for the next three to four weeks, until these properties are buttoned up. I have high confidence that, especially with the help of his wife Barbara, he will keep things moving quickly in Jacksonville while finishing the projects in South Bend.

10/06/2015

Currently under going rehab. Projected completion of rehab in Nov.

09/22/2015

Starting this week with clean-up and demo. Layouts for framing will be ready by Thursday.

08/24/2015

Date of Purchase