Multifamily Investment

I'd love to dive deeper into the numbers. With a 6.5% cap rate, that's a relatively aggressive purchase. What kind of rent bumps are you anticipating post-renovation? Are we talking 10%, 15%, or more? Also, what's the current expense ratio looking like, and how do you see that changing after the re-lease? Lastly, how did you size the loan to the cap rate? Was it a 70-75% LTV, and what are the terms? I'm trying to understand how this deal pencils out, especially considering the 20% below market rent starting point. Can you walk me through the pro-forma and how you arrived at the projected NOI?

I've seen similar plays in the Lexington market, but I've got to push back on the assumptions here. What's the actual appraisal value, and how much of that is based on the pro-forma rents? We've had some appraisers in our area getting a bit too aggressive with their valuations, only to have them come in lower at refinance time. Can you walk me through your renovation budget and projected rental increasse? How much capital did you actually put into this deal, and what kind of cash-out refi are you anticipating after renovations? I've found that our local lenders are getting more conservative on their loan-to-vallue rtios, so I'd love to see some hard numbers on this one.