Success Story: Glider Property Transformation – From Humble Duplex to Rentable Goldmine
Mortgage Vintage, Inc. (MVI) is a go-to hard money lender, always ready to support the goals of real estate investors and business owners. We’re particularly proud of our Business Purpose Cash Out. With our loans, investors can make the most out of their properties, turning simple duplexes into bustling rental spaces. Check out our work with a savvy investor on this Los Angles property—it’s a great example of what can be achieved with a bit of strategy and vision in real estate.
The Subject:
- Property: 8510 Glider Ave, Los Angeles, CA 90045
- Type: Duplex Rental Investment Property, expanded and renovated with additional ADUs.
- Layout:
- Existing Units: Initially 2x 1BR/1BA units (598 Sq Ft each), expanded to 2x 2BR/2BA units (840 Sq Ft each)
- New ADUs: 2 units, 1 BR/1BA (612.5 Sq Ft each)
- Condition: The original 2x 1BR duplex units set for reconfiguration and expansion.
The Scenario:
- An astute investor foresaw potential in this property, with an ambition to not just improve the existing duplex but to also introduce two new ADU units.
- The focus was not only on maximizing space but also on tapping into the property’s strategic location, east of Marina Del Rey, Playa Del Rey, and in proximity to LAX, schools, shopping, dining, and the 405 FWY.
- With a foundation of 2x 1BR units, the expansion and addition would catapult the monthly rents significantly.
The Solution:
- The investor opted for a business purpose 2nd TD cash-out, ensuring that the entirety of the loan proceeds ($433,000) would be channeled into Funds Control. This would safeguard the reconfiguration of the duplex and the construction of the new ADUs.
- Emphasizing favorable loan terms, the investor was presented with 6 months of guaranteed interest, and a competitive 10.00% annualized return.
Financials:
- Total Renovation & Construction Cost: $450,000
- Appraised Value: $1,650,000
- Monthly Rental Income (Post-Development): $13,600
- CLTV: 62.00%
- Net CLTV: 26.24%
- FICO Score: 677
Highlights:
This trust deed opportunity was particularly captivating due to:
- A prime location and the foresight to convert this property into 4 high-return units.
- The promise of a 10.00% annualized return.
- Solid CLTV metrics at 62.00% and Net CLTV at 26.24%.
- Full commitment to the project with 100% funds in Funds Control ($430k).
- The significant monthly rental income realized post-development.
- The assurance of 6 months of guaranteed interest.
By strategically planning and making smart investments, this property evolved from a simple duplex into a highly profitable four-unit property, firmly establishing itself as a remarkable real estate opportunity in Los Angeles.