Case Study: 33-Unit Multi-Family Apartment Building in NW Baltimore

Property Overview
Clarksview Apartments is a 33-unit multifamily property located near the Baltimore County line, featuring 30 two-bedroom, one-bath units and 4 three-bedroom, 1.5-bath units. The property presents significant value-add potential, with opportunities for unit renovations, rent increases, and potential amenity enhancements.

 

Investment Opportunity

By renovating units with modern finishes like stainless steel appliances, granite countertops, and plank flooring, a new owner could achieve rent increases of at least $300 per unit, based on comparable nearby properties. Additionally, converting NEDs units to market-rate two-bedroom units after the HAP contract expiration presents another avenue for income growth.

Location and Market Analysis
Situated near I-695 and public transportation, Clarksview benefits from its proximity to major employers like Sinai Hospital and nearby colleges such as Stevenson and Towson University. This location ensures strong rental demand and long-term value appreciation.

Financial Highlights

  • Gross Potential Annual Income: $488,598
  • Pro Forma Income: $349,500 for market rent, $95,208 for NEDS units, and $32,364 for Section 8.

 

Lessons for Real Estate Investors

  1. Maximizing Revenue Through Renovation: Modernizing units by incorporating high-demand features such as stainless steel appliances, granite countertops, and updated flooring is essential for bridging the rent gap between Clarksview Apartments and nearby properties. By elevating the units to meet modern market expectations, investors can justify rent increases of at least $300 per unit, thereby boosting rental income and improving overall returns.
  2. Value-Add Potential: Beyond basic unit renovations, there are additional opportunities to enhance value. Converting underutilized NEDs units to market-rate two-bedroom units after the HAP contract expiration can significantly increase rental revenue. Further value-add potential exists in refreshing common areas and upgrading the building’s amenities, such as transforming green spaces into high-demand features like a dog park or playground, enhancing tenant satisfaction and retention.
  3. Location Leverage: Clarksview’s proximity to key amenities, major employers, and public transportation hubs ensures a steady stream of potential tenants, supporting long-term occupancy and rent growth. Being close to institutions like Sinai Hospital and universities like Stevenson and Towson makes the property highly attractive to a broad tenant demographic, from professionals to students. These factors make Clarksview a reliable long-term investment, with sustained demand ensuring stable cash flow and property appreciation.
  4. This case study illustrates how strategic improvements and the property’s prime location in NW Baltimore offer robust investment returns for multifamily investors.