New Video Series! Property Walkthrough – Touring a Fourplex in Central Colorado Springs

This episode is the first in our new video series we’re calling “Property Walkthroughs” in which I walk Colorado Springs rental properties with the investor owners. We talk pros, cons and give a quick analysis for each rental property. You’ll gain unique and valuable insight from the owners themselves who share their successes, regrets and give tips on what to avoid and how to maximize return for rental properties.

In this episode, investor owner Garrett gave me a tour of his newest property, a fourplex located in central Colorado Springs.  We looked at one of the newly renovated vacant units, went over the numbers, and learned what his plans are for the future.  

The Building – Multifamily Fourplex Investment Property in Central Colorado Springs

The rental property featured in this episode is a fourplex located in central Colorado Springs.  What attracted him to the property first and foremost was its location—it’s close to major hospitals, universities, associated medical centers, and city attractions, such as restaurants and breweries.  It’s also a convenient hop over to I-25.  On top of that, the units all feature great views of the city and mountains, with one of the best views of Pike’s Peak in the area.  

There are 2 2-bedroom/1 bathroom units and 2 3-bedroom/1 bathroom units.  Some of the units have been recently renovated, boosting market rents right away.  Garrett was pleased with the newly painted neutral colors, durable LVP flooring, new carpeting, and ceiling fans in the bedrooms.  The kitchens have been redone with stainless steel appliances, quartz countertops, and white cabinets.  Right off the kitchens are decks that boast incredible city and mountain views, which is very popular with tenants.  All of the apartments also have in-unit laundry.  

The Numbers – Rental Property Deal Analysis Spreadsheet

Garrett purchased this fourplex for $825K in the summer of 2021. The acquisition costs were $13.5K; he negotiated a seller credit of $7.5K; and he was all in $245K.  

For the 2 bedroom units, he is targeting $1400 a month, though it’s underwritten at $1300 to be conservative.  The 3 bedroom units are currently occupied into next year, but he’s aiming for a little more for those units if there is tenant turnover.  The current tenants have been in the building for years and are very happy, so he isn’t looking to change anything yet.  When he eventually has turnover, one of his options down the road is to adapt a room-by-room rental strategy aimed at college students.  

Monthly Operating Expenses – Fourplex in Central Colorado Springs

All of the gas and electricity is billed separately to the tenants. As the owner, Garrett takes care of water, sewer, trash, and common area utilities.  He has a bill back in place that charges $100 to the tenants every month on top of rent to recoup some of his expenses.  

Garrett uses property management that charges 10%, and he has 7% set aside for repairs and maintenance.  I think this is an appropriate number, since some of the units are brand new, the roof is relatively new, and he’s already in the process of replacing the heating unit.  

His yearly taxes are $1625 and insurance is $2700.  He’s also paying $600 a year for landscaping and snow removal.  

First Year Returns – Fourplex in Central Colorado Springs

Garrett is looking at solid returns on this property that will only get better over time.  

Long Term Plans for the 4plex Rental Property

The side of the building features what used to be a shared laundry room.  Since the units have all been upgraded with in-unit laundry, Garrett is planning on converting the unused room into storage.  He will add in some storage cages with individual locks and offer them for rent to tenants.  

Each unit has its own boiler, and during inspection, it was discovered that one of the boilers is failing.  Garrett is planning on replacing the four separate boilers with one new one that has four zone valves.  He’ll add the cost to the utilities payback.  

Conclusion

All in all, this property is a great win for Garrett, and I look forward to working with him again in the future.  Make sure to check out the property walk video to see the newly renovated unit!

Do you want to see more multifamily deal analyses? Check out all our Colorado Springs investment property deal analyses page and click on “multifamily.”

If you’re interested in finding your own property in the Springs, reach out to me.

How to Get Started Building Your Own Colorado Springs Rental Portfolio

For information on how to get started investing in Colorado Springs, check out our free 2021 Colorado Springs Real Estate Investing Guide.

YouTube Video

Property Walkthrough – Touring a Fourplex in Central Colorado Springs