Case Study: A Successful Multifamily Deal in Van Nuys

Overview

The property is located in the heart of the San Fernando Valley, specifically in the city of Van Nuys. Van Nuys is known for its dense rental community, which is both a potential advantage and challenge in terms of market competition and property management.

The seller was seeking to relieve himself of the management responsibilities and ongoing issues associated with the property. He was looking to sell the building to avoid future problems and to reposition his equity into a new investment. This new investment would be closer to other properties he owns, thereby streamlining his management duties and improving his overall investment strategy.

Challenges at the Multifamily Property

The property had several substantial challenges that complicated our marketing and sale efforts. Several tenants were in the process of being evicted and were not paying their monthly rent. This created a significant hurdle, as the instability and potential legal issues with tenants could deter prospective buyers. The property had multiple mechanical issues, including plumbing problems and outdated electrical panels.

These issues not only raised concerns about the property’s condition, but also made it difficult to secure insurance coverage, which is crucial for potential buyers. The buyer initially faced challenges in securing financing with the first lender. After recommendation from the Matthews™ team, the buyer shifted to a second lender, which ultimately led to securing the necessary financing. This pivot was essential for moving the deal forward.

The Solution

To navigate the complexities of this deal, we employed a strategic and hands-on approach. We collaborated closely with legal and property management professionals to address the tenant issues, including the ongoing eviction process. By tackling these challenges proactively, we were able to mitigate their impact on the sale and provide reassurance to potential buyers regarding the resolution of these concerns.

In addition, we successfully identified an insurance provider willing to cover the property, despite the existing outdated electrical panels. This was crucial for advancing the sale, as securing insurance was a significant hurdle.

When the initial lender was unable to provide financing, the team recommended an alternative lender and worked diligently with both the buyer and the new lender. This collaboration was instrumental in securing the necessary financing, which was essential for the successful closure of the deal.

Our commitment to clear communication, proactive problem-solving, and effective management of all aspects of the transaction ensured a successful closing, despite the significant challenges encountered.

The Outcome at 13907 Vanowen St

We successfully sold the 25-unit property for a commendable $192,000 per door and $312.15 per square foot. The seller was extremely satisfied with the outcome, as it not only met, but exceeded, their expectations. The sale allowed them to relieve themselves of any future liabilities associated with the property, thereby achieving their goal of mitigating risk and freeing up resources
for other investments. The successful transaction also provided them with the opportunity to reinvest in a more manageable and strategically-aligned property.

Client Testimonial

“I am absolutely thrilled with the outcome of the sale of my 25-unit property. From start to finish, the process was handled with the utmost professionalism and expertise. The team’s strategic approach and diligent efforts led to a remarkable sale price far exceeding my expectations. The resolution of tenant issues, securing insurance despite the building’s outdated electrical panels, and navigating financing challenges were all managed expertly. Most importantly, the sale relieved me of any future liabilities associated with the property and allowed me to reposition my investment in a more strategic way.

I couldn’t be happier with how everything turned out. I highly recommend Daniel Withers for his exceptional service and dedication. He truly went above and beyond to ensure a successful and smooth transaction.”