We ran into a few snags along the way, my contractor bailed on me with two weeks to go, and there was a nice little delay in getting the concrete countertops in, but my rehab project at 3969 Humphrey is finally complete.Its been about four months since the project started in July, but I am really happy with the results. The property is going on the market later tonight for $134,900.

Just about everything was redone on the place. Here is a rundown of what we did:

• Totally redone kitchen including 42″ cabinets, concrete counters, stainless appliances,and unique magnetic-chalkboard backsplash.
• Totally redone bathroom
• Roof
• Flooring including maple hardwoods in living areas, tile in kitchen and bath, and carpets in bedrooms
• Low-E, thermal windows
• Furnace, AC condenser and water heater
• Plumbing including lateral to the yard and half service
• Electric including 200 amp service, 95% interior wiring and all fixtures; siding on rear addition
• Security alarm
• Fresh drywall and paint
• Landscaping

Needless to say, the place is virtually brand new. Take a look at it yourself via the pictures and video below. If you want to compare the final product to what it looked like before, you can see old pics here. I’m sure the place will sell fast, but there is no question that it feels very good to be done. Especially since I will probably try to do another one before the housing credit expires in April. What fun;)

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It’s been a little over two months since I last posted about my ongoing rehab project, but I am happy to say that it will be done in less than two weeks. Trim work is about halfway complete so it will mostly be odds and ends from here on out.

At this point the roof, electric, plumbing, rear siding, HVAC, hardwoods, tile, kitchen cabinets, doors and windows are all complete. Baseboard trim should be finished up by Saturday so that finish caulking and painting can be completed. Other than that, here is the work that remains:

• Carpets
• Appliances
• Concrete counters
• Remaining bathroom fixtures
• Landscaping
• Painting the basement
• All those fun little odds and ends

In addition to the subcontractors, I will be at the house all weekend trying to finish up the outside. We are getting very close though and should be able to start cleaning up by the end of next weekend. Just in time to get the place under contract and close before the $8,000 homebuyer credit potentially expires. Since we upped the scale of the work at the place, and because the market is supporting it, the asking price will be $134,900 when it goes live. If you know anyone looking for a place, be sure to give them a heads up.

I plan on having an open house when the project is complete so expect details on that and final pics and a walkthrough video very soon. In the meantime, check out the current pics.

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It’s been nearly a year since I moved my company, Threshold Investment Properties, into my current building at 2654 Gravois and I haven’t stopped working on it for one minute. The building has quite a ways to go before its done, but the office itself is nearing completion. The best example of this transformation is the nearly complete storefront.

Originally a hideously painted, paneled monstrosity, after months of planning and work, the structure is up, patched, primed, painted and now clean. I’m still working on the stained glass, doors and signage, but the bulk of the work is done.

The new section of the storefront is composed of 3″ x 8″ Douglas Fir boards, which I had to have custom milled. There are 23 panels of double paned glass, which do a good job of keeping out the noise and extreme temperatures. I tried to do something a little different to give the place some character and I have been very happy with the results thus far.

I’m still kicking around ideas for the doors and sign, but I hope to have that figured out and have the money to do the work by November. I hope to have the entire office finished by that point too. When I am done, I will be sure to post pics and a video of the whole project as this place has been my love-hate obessesion for over a year. In the meantime, check out the storefront progress pics.

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Last night at 2am I got a surprising wake-up call: the alarm was going off at my rehab project in Tower Grove South. The police were already there and requesting a key-holder to come over. Upon arriving on the scene I witnessed the sobering site of a backdoor kicked in.

Thankfully, my alarm system did its job. Not only did it run off the assailant without any theft or vandalism (other than the door), it also alerted me to the issue and brought the police on site. I know a lot of rehabbers skimp on installing alarms, and even more skip out on having them monitored, but this is proof positive why you should protect yourself.

Another thing this incident reinforces in my mind is that a hand-lock on a door is very easy to break. On the back door of the property in question, that is all that was in place when we bought the place and I was too lazy to install anything more. It looks like a couple of kicks is all it took to break it. Lesson learned. All access points to any property should be secured with a properly installed deadbolt in addition to a standard lock set. Especially on a vacant property.

If you properly secure your properties upon each visit and make sure there is an alarm system and proper lighting (another thing I didn’t have), the odds of a successful break-in are small. I only had one of the three and I managed to get away with only a busted door, which I was going to replace anyway. Still, its better to be safe than sorry as the financial loss and frustration of a successful burglary could have been a lot worse.

Although my rehab project last summer was nearly the death of me (at least in terms of my social life), I am now underway on my next project. Thankfully, this time all the work is being subbed out.Located in the the South Saint Louis neighborhood of Tower Grove South at 3969 Humphrey, this 1,000 sq ft bungalow is getting the works. The following is a breakdown of the work going into the building:

• Electric overhaul including everything from the service coming into the house, the panel, internal wiring and fixtures.
• Plumbing overhaul including a new stack and lateral underneath the basement floor, half-service, as well as all new internal copper and PVC.
• Kitchen including shaker cabinets, 2″ concrete counter tops, and stainless steel appliances.
• Bathroom including fairly fancy contemporary fixtures
• Flooring throughout the building including maple hardwoods in the dining and kitchen, tile in the bath and kitchen, and carpet in the bedrooms.
• Roof
• Windows
• HVAC system
• Tons of other updates such as drywall, paint, trim, doors and landscaping throughout the property.

In short, everything is getting redone. This place isn’t going to be huge, but it will be a quality product for a good price. And since the targeted completion date is the first week of September, there is plenty of time for buyers to take advantage of the $8,000 first-time homebuyer credit before it expires on December 1st (something to keep in mind if you are in the middle or contemplating a rehab yourself).

Check out the “before” pics below. I’ll have updated pictures when the electric and plumbing are finished at the end of next week.

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One of the best things about blogging St. Louis development and real estate deals is that I am increasingly finding myself being contacted by a lot of interesting people. I’ve actually been contacted by quite a few local and even national news providers in the past few months asking my opinion on certain matters or for advice on the direction of a story. But as great as those are for my personal morale and ego, I have yet to be featured in any of those stories. That is, until now.

Yesterday, Adam Allington of the St. Louis NPR affiliate KWMU, contacted me to ask me my opinion about the kinds of opportunities and obstacles that normal everyday buyers face when they are looking to buy a foreclosure. I guess he liked what I had to say because he asked my to meet up with him this morning. He ended up interviewing me for about an hour while we strolled through an example foreclosure in Benton Park.

The great thing about it is that he says it is going to be a national story. Who knows how much of my interview he will use, but its cool nonetheless. Getting to take part in story for a station I really respect is a great honor. Hopefully I did the real estate market and St. Louis justice in my interview. When I know about the air date, I’ll be sure to pass it along. Thanks for working with me Adam.

We closed on the rehab at 4218 Connecticut a couple weeks ago and all the bills are finally paid so the profits can be dispersed. It took way to long to finish everything, but in the end, there was a respectable amount of profit to show for it. Not only did we make money, but the differences in the building before and after construction are amazing.

I went back through all the photos I took and I can’t say how happy I am with how things turned out. To illustrate these changes I have grabbed similar before and after pictures and put them in a side by side display to show the differences. I put a few comments along with each photo to describe the situation. It really is great looking back at it. This project also remains a valuable lesson. No matter how bad the real estate market is said to be by the media, the success of this project is proof that things aren’t that bad after all.

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As with Benton Park, there are a lot of smaller sized projects going on in Forest Park Southeast (aka the Grove). While most of these projects are being worked on by Amy and Amrit Gill’s Restoration St. Louis, but there are other developers in play. I have spotlighted some of these projects in the past (see Update on activity in FPSE and 3 developments in FPSE), but some are new:

• 4229 Manchester – This property is located at the intersection of Arco and Manchester. The project is being developed by Pete Rothschild “Red Brick Development. ” This property is unusual in that it is constructed in a narrow triangular form to match the shape of the block it is on.

• 4244 Chouteau – This property at 4244 Chouteau was formerly the home of the B.C.S Moving and Storage Company. Restoration St. Louis now owns the project and is converting it into over 20 market-rate apartments.

• 4306 Manchester – This is yet another one by Restoration St. Louis. A simple building with no real frills, just another piece of the puzzle being put in place along Manchester. You can see a marketing packet for the commercial lease on Restoration St. Louis’ website.

• 4501 Manchester – This now the home of a new Italian restaurant: Mia Rose. Developed by Restoration St. Louis, the project adds a much needed infusion of development along the western edge of the neighborhood.

• 4512 Manchester – Located across from Mia Rosa, this property is the future home of developer Sitelines. This company is also handling the project themselves. Its a big one and progress has been slow so far. Still, its one of the highest profile buildings along Manchester so its going to really help the western edge. *UPDATE 10/21/08 – I just got a little more info on this project. Apparently this will be the first Green Development in the FPSE neighborhood. The budget for the project is set at $2.1 million.

Take a look at a few pictures of these properties in the gallery below.

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I am happy to say that my rehab project, which was my life for 5 months worth of weekends and evenings, is now under contract. I should mention that this is after only 5 days on the market. And this offer came in on Sunday so it was really about 3 days. I also had a verbal offer (too low) and another buyer who was going to write one today. I couldn’t be happier with the response.

Obviously nothing is certain until we close, but things look very good. We put a lot of effort into the place and its nice to know that it shows. I’m sure the quality of our rehab has something to do with the rabid demand, but I think that’s only part of it.

I have been saying it for months, but I really think that this is just further proof that houses in the $100,000 to $150,000 price range are still hot. With all the single family foreclosures around, there isn’t a shortage of rehab targets out there either. Struggling economy or not, people have to live somewhere. Keep that in mind when lining up your next purchase.

After going through all the numbers, we have decided to list the property at $135,000: an achievable price, I think, in the current market. Once I get all the marketing materials together I’ll update this post with a link. In the meantime, you can browse the final pictures and a short video walkthrough of the fruits of our labor. Pass the info along if you know anyone looking for a house.

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You might have noticed that I haven’t been posting about my rehab project much lately. Well its been a long (way longer than I hoped) road, but the completion of the project is looming. Less than a week away in fact. And boy will I be happy to be finished.

At this point I can’t even begin to recall all the little things that have been completed since I last updated on this topic in early August. We’ve done everything though. All the trim work, flooring, fixtures, caulking, painting… you get the idea. The stairs have been a real pain to paint, but I should be finished with the fine touches on Wednesday. After that, all that is really left is a little weatherproofing for the doors, painting the front door, cleaning up the yard, and doing final cleanup in the house. It feels really good to be running out of things to do.

I’ve certainly been wrong on timetables before, but we will definitely finish up this weekend. In the end it looks like it will have taken us about 5 months of weekends to finish this project. There has been a lot of blood and sweat put into it, but the final product is going to be nicer than I could have ever hoped for. We might even have a buyer lined up already. Once everything is totally cleaned up and finished I’ll take some really nice pics and do a little before and after comparison. In the meantime, check out the updated pictures of the project below.

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Following a couple of delays, and still with a few strings attached, the purchase of my new home and office was finally closed today. I was reluctant to post much about it until I closed, but now its open season. This image is a picture of the front facade of the building. Many of the others I have taken have personal items of current and former tenants, but those included should give you an idea of the makeup of the building.

Currently the upper apartment is vacant. It is in pretty good shape and I will be moving into it tomorrow. The one catch is that the commercial tenant in the lower unit still hasn’t moved. After considerable negotiations, an agreement was made which put money in escrow after closing until the tenant is gone. If they haven’t vacated by Sunday the seller will be penalized and the penalty will increase daily. Hopefully all that goes through without a hitch, but history has prepared me for the worst.

On a more positive note, I hope to have some semblance of an office open by the end of next week. Most of the lower level will be used as my personal living space, but the front area (that’s the rounded room with rounded doors) will be my office. Everything is in good shape overall, but it is going to take about six months to a year to get things where I want them. But after spending the last month of my professional life as a wondering vagabond, I’ll take anything.

Location wise, the building is at 2654 Gravois in the South St. Louis neighborhood of Benton Park West. I’ve been operating nearby in Benton Park for the past year and a half, but this will definitely be a change. Most of Benton Park has been rehabbed, while Benton Park West still has quite a ways to go. Just about all the neighboring commercial buildings are in need of quite a face lift, but I look at this as an opportunity. An opportunity to get in at the ground floor and help improve area.

The nearby commercial sector along South Jefferson has seen quite a revival and I plan on doing all I can to replicate that success. Speaking of which, if you are looking to do a little mixed-use investing or opening a business in South City, I can point you to quite a few building along the strip which would be legitimately good investments. I could always use a few good neighbors.

We’re now entering the home stretch of the project. And it couldn’t come any sooner. We’re looking good on our overall budget and profit margins, but things have taken longer than we hoped. We won’t be done in a week’s time, but the only thing left will be minor finishing projects. At least I finished floating out the original plaster walls.

As you can tell from the pictures, the bathrooms and kitchen have been installed. I’m really happy with how everything turned out. The only thing left in the kitchen is the concrete countertop, back splash and custom shelving in the corner. The shelving will be in this weekend. As for the countertops, we’re having concrete countertops manufactured and installed by Councrete Counters STL early next week. I shopped around for these and they came in well under the bids of their competitors and their counters are much thicker (2 inches!). I’ll post about our final experience with them when they are finished.

We also managed to finish smoothing out all the drywall and plaster walls throughout the house. That was no simple feat, but everything is now primed and ready for paint. Since we are under budget and looking to move along as fast as possible on the project, the painting of the walls and ceilings will be subbed out. After Tuesday, August 12, we should only be left with installing a few doors and doing the trim work. I’ll post pictures of the painted and cleaned up project next week.

On another note, we put a “Coming Soon” sign in front of the property this past weekend and we are already getting interest. When listed, the property will start at $133,500 and we will see what we can do from there. Anyone in the market for a house?

We have finally gone to the next phase of the process on the Connecticut rehab. The tile has been laid, the hardwoods have been refinished, the drywall is completely done, the front porch is coming around, both the front and rear doors have been replaced and all the utilities are done. Its finally starting to feel like a house.

We’ve had a lot of odds and ends to take care of in recent weeks, but the progress we are now making is pretty substantial. By this weekend, the kitchen and baths will be painted and ready for cabinets and fixtures. We’ll have everything in except the countertop on Saturday. For that, we are going with concrete countertops, which will be installed in a couple of weeks. We should also wrap up work on the front porch, which is already looking great, as you can see from the pics below.

Another project I have been working on over the past few weeks is skim coating the existing plaster throughout the building. That should finally come to an end this weekend as well. After this Sunday we will only have to finish up the rest of the interior painting and install the interior doors and trim. There are more minor projects to work on at that point, but the project will be very close. I expect to be getting close to to a finished product by the end of the weekend of August 2nd.

It’s been a grueling effort trying to juggle this project, a full time job and starting a new brokerage all at once, but its great to see the fruit of all our labors come to a head. As far as selling the property, I am still very optimistic. The building that was under contract down the street at $119,900 ended up closing at $122,000. Another house on the block just sold for $151,000 after about a month on the market. There are also a few other similar houses nearby that are under contract right now. We have a good product to offer and the market seems to good for this price range at the moment. Things are looking good.

I’d like to say that we are almost done (I was hoping to be done July 1st originally), but we definitely have a ways to go. At this point, here is what we have completed since my last update:

1. The roof is finished. At least the shingled section. The flat part of the roof should be done on Monday. We ended up doing a partial tear-off roof because the roof over the dormer was in such bad shape. It looks great now though.
2. All the windows, except the front two, have now been replaced. We ended up going with quality vinyl windows for the replacement. The front two windows have spherical tops and had to be special ordered. They should be installed within the next few weeks.
3. All the tuckpointing is done. The now-exposed fireplaces as well as all the exterior work. The bricking-up of the former deck door upstairs has also been completed. Once we paint the brick on the rear of the building again, you won’t be able to tell the difference between the old and the new.
4. All the large sections of damaged plaster have been repaired or patched with drywall. There is quite a bit of mud compound that still needs to be applied, but that should be completed soon.
5. The reoriented hallway, new closets upstairs and the downstairs bathroom are now properly framed.
6. The stump and brick patio that used to be in the back yard have been removed. We also ripped up the old brick sidewalk and laid a new one that spans the entire length of the yard. The yard has also been fully landscaped. If only we could get a good stand of grass to grow.
7. Lots of odd jobs have also been completed. Things such as repairing the basement door and ripping out the old bathroom and kitchen fixtures among them.

That, pretty much, covers what has been going on over the last month. Currently, I have the plumber, electrician, HVAC guy and alarm company all getting in a bit of work while they have access. Over the next two weekends we will finish firring out all the walls in preparation for drywall, finish patching the damaged plaster, repaint the back side of the house and repair the deck. Then, during the week of the 23rd of June will come the drywall. We are actually subcontracting that work out, so it should be done by the weekend on the 28th.

Following the drywall work will be the refinishing of the hardwood floors and the installation of the tile floors during the week of the 30th and 7th. So if everything goes to plan, we will have all the walls and floors finished by the weekend of July 12th. That will just leave paint, trim work and final work in the kitchen and baths. There are other odd jobs to do, such as replacing the existing wood fence in the rear, but nothing else major. We think we will be done by August 1st.

As it stands, everything is within budget and looks good despite the fact that things are taking a little longer than hoped. We are also more confident than ever of our abiltiy to sell the building once we are done. A much smaller building three doors down went under contract for $119,900 after only three days on the market this past week. We’re quite confidant of the superiority of our product and really think our price point of $129,900 is going to be very reasonable. We’ll see in six weeks.

Another week goes by and it’s been more of the same: ripping stuff out. Both inside and outside, nothing but demo and breaking stuff. Thankfully, by this upcoming weekend we should finally be to the point where we have actually started to add to the building rather than just tear it apart. Demo is fun for about 10 minutes, then you realize that its bad on the back and a disaster for your lungs. It will be nice to be past that stage. Its been going well so far and I still think we are still on track for a late June completion.

Below is a rundown of what we worked on this weekend:

1. Finished cleaning up the fireplaces and prepped the old mantle in the dining room for hardwood patching.
2. Ripped out the old chimney in the upper bedroom to free up some uninterrupted wall space.
3. Finally figured out how we are going to handle the laundry space and cabinets in the kitchen.
4. Ripped out the wall between the two bedrooms to make way for the new hallway orientation.
5. Ripped out the unmaintained brick patio in the rear. The good bricks will be used to finish the walkway in the rear. As for the broken bricks… anyone in the market for some free fill?
6. Lots of general cleaning.

Overall, not too bad for a weekend of only 30 man-hours. Thankfully, we’ll have a full crew of workers on hand starting next weekend. Real progress will finally start to materialize. My next mission is to prepare everything for the tuckpointer and window guys to come next week. Some of the window frames need to be prepped and the old door opening in the upper bedroom needs to be framed up so the tuckpointer can brick the opening up to window height. Once we have that done, it will be time to frame the new hallway and the laundry cavity, as well as install the walkway in the backyard.

If we manage to get all that finished we will be all set with our contractors. During the week of May 12th we would be ready for the tuckpointer, the roofers, the window installers, the electrician and the plumber. Progress is good. I just hope we can get to that point before the end of next weekend. Mother’s Day could make that a challenge.

Security-wise, I still need to put new doors in to finish securing the property as tightly as I would like, but I took measures with the existing doors to reinforce them in the interm. As for demo work, I have removed all the old paneling in the hallway, the plaster and paneling around the old fireplaces, the drop cielings in the kitchen and stairwell, the moisture damaged drywall in the upper bathroom ceiling, and so many other things. I think I should be finished up with all this work with a few more hours tomorrow.

It’s funny how you plan ahead for these projects, but you never really know how things are going to go until you actually get in there are start working. For instance, I had planned on putting new drywall around the old fireplace in the dining room and around the existing non-functional fireplace in the living room. When I started the demo I changed my plans. As I took off the paneling that was previously in place and chipped at the plaster, I found some great brickwork underneath. I didn’t plan on it, but now there will be exposed brick fireplaces in both rooms. There will be some tuck pointing work and additional cleanup for the bricks, but it will be worth the time. It really sets things off.

The utilities looked good before purchase, but were really a crap shoot in terms of condition. When they were all turned on Thursday, everything went off without a hitch. HVAC, water pressure, water heater… everything is working great. Honestly, I was expecting something to go wrong during that stage, but it looks like we’re in the clear. Things are going a little too smoothly at this point. I’m not complaining though.

The windows are set to be installed in two weeks and the roof should probably be in within the week. I’ve still got prep work to do on the windows and the roof before those get done. I also need to do some minor patch tuckpointing on the exterior walls and chimneys. Once all that gets done, I’ll feel confident that we have cut off all possible entrance points for moisture and we’ll move on to drywall and floors.

Overall, after spending the bulk of the last three days at the property, I am feeling very confident about the project. The area has proven quiet at all times and days of the week. And rain nor shine has opened up any unseen flaws in the property. So far so good.

I keep milling over numbers and considering our different options, but at this point I am just going over things that are already done. I’m just ready to get my hands dirty and start making some progress. After all, the sooner we finish construction, the sooner we can put the property on the market. I’m quite confident in this project regardless of the cloud put over the market by the fear-mongering media.

The comps and continued sales of quality housing in Tower Grove South just don’t lie. Three similar properties have sold on this very block in the last year. The final sales prices of these properties were $109,000, $118,000 and $160,000. On top of that, the property that sold for $118,000 was a sister building to our project and it sold in inferior condition to what our finished product. There will be quite a nice profit margin in the end. Consider the following costs:

• $45,000 – purchase price
• $3,000 – closing costs
• $25,000 – projected construction costs
• $3,000 – 6 months holding costs
• $6,000 – cost of sale

Tallied up, we project a total of $82,000 will be tied up in the building in the end. And that’s a high estimate. Of course there will be some significant sweat equity too, but I don’t mind that. Currently, our target sale price for the finished project is $120,000. That could change, depending on a variety of factors, but if we manage to pull everything off as expected we would end up with a total profit of $38,000. Not a bad trade-off for losing a couple months worth of weekends.

Even if things don’t turn out as well as expected we will still make a nice profit. And if the bottom falls out of the market in the next couple of months, we will just rent the house for a while. We get a lot of demand for nice rental houses in South City through my office so I am not worried about that angle. I feel justified, I feel prepared, I feel ready. Now if only Wednesday would get here.

Actually, we are keeping busy while we wait for everything to really get started. For example, I was at the property just today doing some work in the yard with my brother (who I am partnering with on the deal). Despite the fact that we don’t own the property, we wanted to clean up the trash and leaves in the yard to allow the grass to grow unobstructed so it will be in the best shape possible when we put it one the market. I took a few pictures while we were there to give you an idea of the condition of the property.

I’ll post a break down of the financials of the deal next week.

I plan on tracking the progress of the project on this blog for your reading pleasure. Hopefully it prove to be an example of how to do things right, not the other way around. We’re not set to close until April 23, but I’ll post more pictures and information later this week to “set the stage.” You’ll be able to follow this blog series through the My Projects category, which is accessible from the Other Topics tab in the sub menu. Check back regularly to see if I sink or swim with this one.