Performance History
Project Langside
Description:
This project consists of 17 units. Concrete construction, 2-story walk-up. The project was acquired with full occupancy and with a well-executed plan, we staggered the renovations throughout the year allowing us to ensure positive cash-flow while in our “renovation” period. The rents were all registered and we worked with the residential tenancies branch and completed an above guideline rent increase.
Strategy:
BRRR (buy, renovate, rent, refinance)
Purchase Price & Numbers:
Purchase: $1,650,000
Renovation: $650,000
Capital required: $1,081,000
Appraisal/Refinance/Resale:
$3,100,000
Timeline:
12 months from start to finish & refinance.
NET Profit/Cashflow:
$3,750/NET per month utilizing long-term leases
$0 left in the project upon the refinance & capital returned to investors in full.
Project Consol - Consulting Project
Description:
This project was an 8-unit building and acquired for “above market value” with very low rents. The owner lost money for 3 years before retaining Arete. Arete worked on a multi-tiered structure included two phases of construction.
Phase One: renovate and stabilize the building before the renewal date of the current financing.
Phase Two: Rezone the lot and develop additional dwelling units
In phase one we were able to renovate the building for $650,000, inclusive of major efficiency upgrades allowing for grants and buildings efficiency being increased by 51%. The building value as 8-units is worth $1,800,000 and is currently being used in a refinance via CMHC. In Phase two the building is seeing another $250,000-$300,000 investment towards new dwelling units, however, the value will shoot up to $2,500,000. Our client will get 100% of his funds returned, be cashflow positive and hold a large equity position.
Strategy:
BRRR (buy, renovate, rent, refinance)
Arete’s Scope:
Assess, evaluate, and formulate plan.
Organize construction.
Organize tenant evictions and process
Manage construction
Filled the building in ~2 weeks with our in-house property management
Complete rezoning
Underwrite project and apply for financing
Secure financing
Purchase Price & Numbers:
Purchase: $1,000,000
Renovation: $1,900,000
Appraisal/Refinance/Resale:
$2,500,000
Timeline:
8 months from start to finish & refinance.
Phase two will be another 1-1.5 years.
Make it stand out
Description:
Project Edison consists of a mix of one and two bedroom units totalling 16 units. The building was previously renovated ~10 years ago therefore, the units themselves were in great condition.
We found upside in a few possible improvements and neglected areas as well as one 2-bedroom unit being an original unit with a caretaker.
Our strategy was to secure CMHC financing at 95% LTV via their CMHC MLI Select program and did so through committing 60% of our units to affordability and secured energy points.
We used Efficiency Manitoba and did energy upgrades such as all new windows, new common area windows included, refresh, boiler upgrade and a few other things greatly reducing our expenses and increasing building efficiency.
We were therefore able to complete this project in ~6 months and received our final draw via CMHC, returning all of our partners capital and were then stabilized.
Strategy:
BRRR (buy, renovate, rent, refinance)
Purchase Price & Numbers:
Purchase: $2,465,000
Renovation: $220,000
Capital required: $450,000
Appraisal/Refinance/Resale:
$3,300,000
Timeline:
6 months from start to finish.
NET Profit/Cashflow:
$2,900/NET per month utilizing long-term leases
$0 left in the project upon the refinance & capital returned to investors in full.
Project Home St
Description:
Project home was a 14 unit character building. With much of its character still present today. Unfortunately, the owner had not renovated it much, subject to a few things & the rents were not compliant with RTB's rent control. Therefore, we took possession, paid out the tenants with a rent rollback of $77,000 & processed evictions & then renovated the building in its entirety.
We then had a newly renovated building from the inside out, completed an above guideline rent increase, allowing us to increase the registered rents & began leasing.
Strategy:
BRRR (buy, renovate, rent, refinance)
Purchase Price & Numbers:
Purchase: $1,007,000
Renovation: $347,000
Capital required: $578,179
Appraisal/Refinance/Resale:
$1,930,000
Timeline:
9 months from start to finish & refinance.
NET Profit/Cashflow:
$1,270/NET per month utilizing long term leases
$0 left in the project upon the refinance & capital returned to investors in full.
Project Regent
Description:
Project regent was a brought to us off market by a contact we had met once a few years ago. In our blog, we mentionned that first impressions last. This was a surprising call to receive. Anyways, the project itself was in good shape, but overall outdated & had very low rents in place.
After careful due diligence we had found a few problems & negotiated with the seller. The seller had decided not to move forward with a sale, but after many months came back around. We had also educated the seller on the fact that the rents were registered at a lower amount than what was currently being rented for & therefore, a rent rollback would be required. The seller also went ahead and did that, thus, making it easier for us to achieve are target rents and avoiding any rent roll back needs.
We took possession & were able to renovate very quickly, help the existing tenants find new places to call home & our contractor completed the construction in a very quick time frame, this also allowed us to begin leasing way ahead of schedule. This project, though, had been projected to last 8 months from start to finish, only lasted us 5 months and therefore became a greater success for us.
Strategy:
BRRR (buy, renovate, rent, refinance)
Purchase Price & Numbers:
Purchase: $835,000
Renovation: $230,000
Capital required: $391,000
Appraisal/Refinance/Resale:
$1,431,000
Timeline:
5 months from start to finish & refinance.
NET Profit/Cashflow:
$807/NET per month utilizing longterm leases
$0 left in the project upon the refinance & capital returned to investors in full + $54,000.
Project McPhail
Description:
This property is considered a duplex, it is an 850sqft bungalow with one main floor unit consisting of 2 bedrooms, and one basement unit consisting of one bedroom. There is also a double detached garage which includes a rooftop patio. The property itself had just undergone developing the basement unit and converting this dwelling into a duplex. However, the main floor unit was completely original. We also felt we could add a few amenities in the basement unit. Therefore, we renovated both units, while the basement was minimal the main floor needed everything.
We were able to complete this project in 35 days with full occupancy immediately, in fact, the basement unit was leased prior to the completion of renovations.
Strategy:
BRRR (buy, renovate, rent, refinance)
Purchase Price & Numbers:
Purchase: $250,000
Renovation: $23,000
Capital required: $142,000
Appraisal/Refinance/Resale:
$350,000
Timeline:
2 months from start to finish & refinance (acquired with full occupancy in 35 days).
NET Profit/Cashflow:
$352/NET per month utilizing longterm leases
~$8,000 left in the project upon the refinance & 95% of original capital invested returned to our partners.