Buffalorising has been redesigned.

I used to live there, a couple owners ago.
I'm glad to see the current owners wanted more than a cheap buck, since when I was there it was a teeny slice of hell on earth with a lot of potential.

There is no money to be made in this building for anywhere near this price. Should not be more than 1.3 million. All one has to do is take a look at the numbers.

I don't know anything about what the price should be but I did live in the house exactly next to the place for 3 years up until a couple months ago. It is a cool building.

I don't know about that statement hook:

If whoever bought the building didn't put up a down payment at all the monthly mortgage would be 14K a month and change.

If the 29 apartments average $550 a month and each retail tenant pays 1,000 a month they would take in 19K a month.

The other thing to consider is that if the infrastructure (plumbing, electrical etc...) is there, changing units into luxury apartments isn't that expensive. Some new appliances and new flooring and you are done.

Taxes? At 1.7mil woulbe be upwards of $45,000 per year...not attractive as an investment...

Thanks, CommercialGuy, for your customary dose of reality.

No downpayment on a commercial property, Transplant? Prime plus one percent? Thirty-year amortization? Maybe. Nice work if you can get it.

Property taxes in Western New York are a terrible disincentive to people who'd like to be there.

this building is not worth more than 900k

Perry-

First of all I used 8 percent over 20 years but nice try.

Secondly, I was stating that even without a down payment, there would still be money to be made. Obviously there would be a downpayment of 20% or 340,000, making the monthly mortgage much lower. Keep in mind that for this to be a good investment, you would want a 10% ROI at minimum, which would mean you would need at minimum 34,000 a year in profit. There is much more room than that.

If the taxes on that building are really 45G a year than I can see that as a potential problem....that seems really really high.

From MLS:

This 29 unit apartment was built in 1915 and is approximately 28712 sq. feet. The nearest cross street is Ashland. The taxes are $17,262.

the property is currently assessed at $400K. city/county tax is around $45 per thousand i think. that would get you the $17+ in property taxes. With the aggressive nature of the city at this point in regards to reassessment if this building were reassessed at anywhere close to this acquisiton price (ie. $1.5 million) the taxes would be over $60,000. This really points out the disincentive to development of our current property tax system and policies.

Lets get some facts straight. There are 20 apts in this building. 2- 2 bdrm,2-3 bdrms,2-1.5 bdrms, and 14 -1 bdrms. There are 9 store fronts. They have been joined to make for 5 stores at present. Rents for the apts bring in 13,970. Rents from the stores bring in 4,905., for a total of 18,970 a month. Annual rent collected including 5% vacancy is 227,400.00. Taxes are 17,262.25 yearly. Total yearly expenses are 86,949.69. This leaves your expected net to be 11,056.69 a month and 132,680.31 a year. Put your 20% down,340,000. and pay your morgage and tell me where there is worhtwhile return on your 1.7 million. The owner won't let this place go for 1.5 unless you buy his two other properties in a package deal.

This is the problem with Buffalo. You can purchase a property from someone who has owned it for 20 years, and by the next tax year your property taxes are up over 300%! Buffalo is one of the few places that have re-assessment based on 100% of the purchase price. It is unfair to be paying 3 or more times then your neighbors for a similar property. This close minded policy, of spotted assessments, is chasing away experienced outside investment for larger scale commercial properties/projects (as it is the more experienced investors familiar with this practice in Buffalo, that is precisely why there are so many amateur investors purchasing in your City).

Being an out of town investor myself (who loves Buffalo), I find many fellow associates eager to invest in larger scale projects in Buffalo, however, they are forced to look away because of this tax issue. Buyers to not wish to purchase properties on today’s assessment, and sellers do not wish to sell on tomorrow’s re-assessment.

I would love to start a group that would address this issue to the City of Buffalo. Maybe are slogan would be "Stop chasing away outside investment into your wonderful City!"

Hook, the return is on the amount invested, not on the purchase price. If $340,000 was all one had to spend to get this place, then an annual net of $132,000 looks decent. After 3 years, the buyer would have 100% of his cash back.

EVRsnt the $132,000 was before paying the mortage. Which at 7% would total $9,048 per month or $108,576 per year. Leaving you (in a perfect world) with $23,424 per year (please note that this is based on the current #'s, and does not factor in tax re-assesmnet). Any potential purchaser would be lucky to be breaking even after year 1!!!

Thank you outside, though I think you meant "any purchaser would be lucky to be breaking even after year 14",not year 1:) The owner has put over 400k into this place bringing his investment to 1.2+. At this asking price(1.7 million) he stands to profit 1/2 million in two years time! This isn't Brooklyn! Beautiful building and great location though, hopefully the price comes back to Earth and it ends up in the hands of someone deserving of it.

It's good to see the building is still standing. I lived there for about 3 years when I was a mere lad of 2-5 years old. If I remember right there are wood porches in the rear building looking over a courtyard. There used to be a art studio in the store fronts. Joe Marfollio was the artist . Wow that about 40 plus years ago.

Why people who have no intention of buying a place are arguing about its asking price is beyond me. An interested party certainly wouldn't discuss it online.

Sell the 20 apartments off as condos at a modest $185K and you get $3.7 mill. To do that you would need to invest another million-ish. That leaves you with a $1 million profit. Very likely you could get a lot more for condos in this hood.

Sherman it is pretty much still exactly as you described it.

PLEASE TELL ME ..Where can you get a mortgage to purchase a $1.7 million dollar property with ZERO DOWN!! PLEEZ HURRY!! I'm putting my coat on now!!

Steel do you really believe you can get $185,000 for a condo there? Whats your basis?

i lived in this building for many years and it is definitely a gem of the city. it has endless potential so i disagree with some of you. however...it takes an owner with a soul to make it happen.

I used to live there and I think this property has great potential- as long as it gets rid of its long-standing crook of a landlord. In my opinion, the state that the building and its apartments are in right now, 1.7 mil is asking too much.

WCP, true, current taxes are 17k, but it will be reassessed the moment escrow closes!!!

This discussion is too much. PaulPops's comment is funny.

When it sells, it will be reassessed big time. It's viable as a medium money maker left as appointments, and alot has been done to the building, but it is reasonable to expect a fair amount of upkeep expense. Plus, you'd be smart to hire someone as a super.

And why is nobody discussing utilities? The owner pays for most of them here, I think - factor those numbers in.

Lastly, as for the condo idea, nobody's paying $185K for condos this size with no parking. Not when a house on the same block can be had for around $150K. Maybe if you reconfigured the entire building into about 12 units, MAX, it might be marketable.

I am disgusted. What is too much is how property is taxed in this city. Why is this property assessed for $400,000 when it was sold in 2004 for $860,000?

In 2004 I was fighting an assessment valued more than 150% of my purchase price for my home located only 1/2 a block away. That with a vacant, foreclosed house next door and an abandoned house across the street.

If my assessment reflected my purchase price less than six months after I bought it, then why is this property valued at less than half of its purchase two years post sale?

Actually with the right improvements they could easily get $185K or more for apartments here. Many people are not interested in owning a house and many more are not interested in owning a house that needs work. The only 150K houses for sale in this neighborhood need work. There is also a huge pent up demand for new construction in the city. With the proper improvements this building could sell as a new build. Witness the 350K townhouses that sold out prior to construction just a little way from here. And parking could be accommodated behind the building or by agreement with the lot across the street. Its not out of the realm of reality.

uuggh: Welcome to Buffalo!!!

STEEL: I still disagree. If you take the total square footage of the building, and take 2/3 of it for the residential component, then take out 10% for circulation, utilities, etc. you end up with an average of only 860 SF for 20 units. And you still haven't dealt with parking, which in this area is not easy.

I realize that alot of work has been done to the building, but I would hardly classify it as "condo-grade" - more like "profit margin preserving apartment grade". Plus condos would require splitting the heat up for the whole building, which is big $, and several other amenities would be required to approach that kind of sale price (A/C, elevator of course!.) Once you've spent all that money, I think your profit is gone - at least at that purchase price.

Not that it isn't an awesome building, and worth it as apartments now. I live across the street, and value it's presence... Let's not let this BRO "pie in the sky" thinking permeate EVERY discussion.

we live in the building currently and we have some of the best neighbors in the whole city we have turned the back yard in to a community hang out for all of the residents here at lexington gardens including full private bar on the back porch .. 1.7 is a little heavy considering the owner only payed 880 k for the property 4 years ago ... But if your in your 20's to 30's and ever have a chance to rent here go for it the porch parties alone are worth it + you get kuni and mr. kings general store below you .... the mayor of the porch CHOP$

The City of Buffalo now re-assesses every year based on asking price. As city taxpayers, we pay an Amherst company, GAR Associates, to punch in some numbers without any basis. Check out the tax ripoffs at 29 Colonial Circle (assesed at $150K, on the market for $499K, probably worth $350K), 68 Days Park (assessed at $100K, 29K square feet, stole the parking lot on Wadsworth and Allen from the city, probably worth $1m) and 425 Porter Avenue (assesed at $250k, on the market for $1.2m, probably worth $750K).