This 1904 Craftsman Triplex is located in the corner of the North Slope Historic District in Tacoma. Recently remodeled and restored, the building keeps the historic charm while meeting modern expectations. This building was owner occupied when they first bought it in 2009 and the pride of ownership is still evident to this day. Not your typical put-a-bandaid-on-the-problem multifamily property, the owners have made sure to keep this a home anybody would be proud to inherit.
As terrific as the home is, I think the greatest selling point is the location. Tucked away in the 3 Bridges neighborhood, you’re centrally located between Proctor and Stadium District with the University practically down the street. Immediately next door you’ll find Dave’s Meat and Produce with fresh, high quality (you guessed it) meat and produce. For the healthy foodie you can’t get more convenient! But if you aren’t up for cooking you’ll find plenty of other options just a minutes walk away on N 21st such as Magoo’s Ale House and Eatery, 21 Cellars, The Rustic Aristocat Coffee Co, Cementine House, Evolve Home + Apparel, Lou’s Barber Shop, Source Yoga, and The Beach House Salon.
- Unit 1915 – 2 beds, 1 bath, 1,250 sq ft: This is the top level and Anne’s favorite of the three. Light and bright, this is a fully carpeted unit with a spacious balcony.
- Unit 1917 – 3 beds, 1 bath, 1,300 sq ft: This unit mirrors the top levels floorplan but with a completely different feel brought on by the dark hardwood floors, craftsman trim and tall ceilings. This one gets my vote!
- Unit 1917 ½ – 2 beds, 1 bath, 750 sq ft: The bottom unit is the smallest of the three and has an open concept floorplan with a large walk in closet off the master.
Now lets do some number crunching (because if you know me, that’s my favorite part).
These units are way under market rent! I hate to say it because the tenants are amazing, but it’s just the reality. The comparable homes in the area are going for $1.50+/sqft while this one is puttering along at $1/sqft (here’s a studio apartment a few buildings away going for $1100, and here’s a duplex with similarly sized units renting for $2350; those are literally the two closest rentals to the property, currently available on craigslist; I’m sure deeper digging would find more). I’m only just beginning to foray into the crazy Tacoma rental market and although I don’t know it like good ol’ Gig Harbor, I don’t think it’s unrealistic in the slightest that you could hit 5k/month in rental income.
Assuming this, you could increase the gross income to $60k per year. As is, that pushes the NOI to $50,368 and a 7.42% cap rate (from a 4.66%!) at the listing price. I would also encourage the incoming landlord to consider separately metering the units and passing W/S/G on to the tenants for an additional $2849/year (7.84% cap baby). Auction off the parking spots? Incentivize a tenant to take care of landscaping? Hire a good professional photographer and stage the home so you can get top dollar (stop running around with an iPhone and snapping 3 pictures to throw on the internet guys – SELL IT). There are tons of creative things you can do to increase your bottom line (I can help).
[Disclaimer] Look guys, do your own homework. Being the listing agent, I shouldn’t be your final resource and even I’m putting a rock of salt next to this as I just did a quick 5 minute analysis. If I was representing the buyer, we would dive way deeper into comps, potentially viewing a few available similar rentals on the market. This property is awesome. I’ll be there Saturday 6/23 from 11-2pm with treats and drinks and ideas, come take a look.