Tucson Property Management – Multi-Family Rental Property Investment
Case Study Executive Summary
An out-of-state – San Diego, California – rental property investor searches for a multi-family investment property in the profitable Tucson rental market.
The purchase of a property is contingent upon the investor finding a local Tucson property management company who will ensure the investment remains profitable. Real Property Management Evolve guides the investor on the best Tucson location, which rental property to buy, and provides rental income forecasts and bid estimates for recommended renovations and upgrades to maximize the long-term return on the investment, all before closing on the sale of the property.
Profitability is improved as total rental income is increased over 25% per annum due to the implementation of Real Property Management Evolve investment recommendations.
Profile of An Out-of-State Tucson Real Estate Investor
The investor lives in San Diego, California and is a rental property investment owner who was seeking to expand, diversify, and invest in a multi-family rental property in the profitable Tucson market.
The investor’s real estate agent referred him to Real Property Management Evolve that had been successfully managing another client’s 16-plex multi-family rental property in Tucson.
During the first contact, Real Property Management Evolve answered the investor’s questions about Tucson property management fees, since this would determine whether he could profitably invest in Tucson from a remote location.
The investor had never hired a property manager, so he was a “bit nervous” due to the gravity of the decision whether to invest here, and his inexperience working with a property management company remotely.
Real Property Management Evolve helped the investor decide which location and property would be best for long-term investment potential. They ultimately helped him decide on an 8-plex multi-family rental property near the University of Arizona, which as a bonus was being offered with seller financing.
The Real Property Management Evolve team provided bid estimates for recommended cosmetic renovations and upgrades to the property, which they determined would increase the amount of rent each unit could earn. One of the important recommendations included upgrading from an evaporative cooling system (Desert or Swamp Cooler) to a more effective air conditioning system to better “sell” the rental units.
The investor and the Evolve team discussed the details of the investment many times before closing on the sale of the rental property. Knowing what the property management fees and the bid estimates for the upgrades were prior to purchase was key in the investor’s decision making, because he had to stick to a pre-determined budget.
The Real Property Management Evolve Advantage
Upon purchase and signing the management agreement, Real Property Management Evolve transferred the property management responsibilities from the previous property manager, including rental leases and security deposits.
Afterwards, we discovered some of the current tenants did not have lease agreements. We worked with these tenants to receive deposits and stabilize the rental income by placing each tenant in a long-term lease at a positive rental rate. One of the tenants happened to be the daughter of the seller, which could potentially have been a concern, but she too was placed in a long-term lease like the others.
A few of the 700+ sq ft, 2 bedroom, 1 bath units were vacant, so we began renovating them 2 at a time. We updated the kitchens with new cabinets, counter-tops, and stainless steel appliances. The carpets were replaced along with all hard floor coverings. Tile accents were added to the bathrooms for a more appealing modern look. Renovations were completed within the month.
The design concept was chosen to make each apartment more attractive to University of Arizona students, whose parents are usually included on the lease to offer even more financial security. The location on Richey Boulevard in Tucson, Arizona 85716 is only 3 miles from the University of Arizona.
Our client has enjoyed the benefits of choosing Real Property Management Evolve property management services, which include regular rent collection from fully leased units, which was not the case with the previous property manager, 24 hour tenant access to our maintenance hot-line, and regular custom reporting with details on itemized maintenance costs and property management fees.
According to our new client, the best thing about working with us was our ability to guide him toward choosing an investment property that would generate more income than a property that was “tapped out” of its potential for long-term, increasing rental income. Because the investor was not a local, we were able to direct him toward a property that was closer to the university and would generate better income after applying our recommended improvements.
Whereas the initial rental income from each unit was moderate, by following the recommendations of Real Property Management Evolve, the investor was able to enjoy an increase in rental income per unit of over 25% per year with full occupancy.
Call Us Today
If you are considering investing in the Tucson rental property market, we invite you to call us at (520) 883-7368 today to find out how Real Property Management Evolve can help you find and manage your next Tucson rental investment property.