As Buffalo’s neighborhoods continue to stabilize, we must look to all of the developers, large and small, that are helping to pave the way. Whether it’s one person working his or her heart out on a couple of houses on the West Side, or someone who has grown beyond that threshold, there are more and more people contributing to the city’s renaissance each and every day. And that’s a good thing, because there are still plenty of residences that need a lot of work.
The typical renter or homeowner does not want to deal with fixing places up – they want to move in to a place that is ready to go. If there’s anyone who understands this, it’s Jeff Danahy (inset) – a guy who left his former profession of selling commercial insurance to pursue a life of purchasing, rehabbing and renting houses. Jeff bought his first property back in 2011, at a time that the city’s real estate market was just starting to blossom. He quickly realized that not only was he quickly leasing the apartments that he was fixing up (by himself), but that the values of his properties were rising steadily. Today he and his business partner are in possession of 70 apartment units in Buffalo, and Jeff manages to add a couple of houses to the portfolio each year.
Jeff’s latest acquisition is somewhat different than the other properties that he has purchased over the years. It’s located at 14 Ardmore Place, on a street that was featured on Buffalo Rising a couple of years ago when the bricks were uncovered and restored.
When Jeff first learned about this particular fourplex, it was condemned and in foreclosure. It had been winterized since 2013, but the structure was shot – a load bearing wall in the basement had collapsed, causing the house to sink upon itself inwardly. “The first thing that we had to do was jack up the house – it was down eight inches altogether. We managed to raise it six inches, and decided that any further and we were going to cause additional damage. It was really scary listening to the sounds of the house as it was being lifted.”
It was really scary listening to the sounds of the house as it was being lifted.”
Along with propping the house back up, Jeff also removed four layers of roofing. “You could see right through the eaves,” remarked Jeff. “There was a family of raccoons living in the attic that we had to relocate. There was no gas or water or electric to the building, so we had to replace everything. At the top of the stairs we had to remove another load bearing wall that made no sense and obstructed the flow of the units. Since all four units were of the same configuration, I designed the floorplan – I’m a licensed GC and real estate agent, which helps with these types of projects. It took us four months to complete the work on this circa 1920 house. We leased three of the units well before they were even finished – we have one more to go. Considering that this is such a desirable neighborhood to live, we knew that it was going to be easy to lease – we’re getting $800 for each unit. We bought the building for $160K, which is a little more than we wanted to pay, but we have another five unit right down the street at 667 Richmond, so this made sense. We were familiar with the neighborhood.”
After dealing with this formerly condemned building, Jeff built up some confidence in his purchasing philosophy. His latest acquisition is on Amherst Street across from Wegmans. He says that the house is in terrible shape, but he’s confident that the street is on the rise and is prime for investment. “I’m starting to look further and further away from where my primary focus once was,” he told me. “I’m looking further and further into the West Side and other areas.”
Jeff told me that he has been fielding interest from parties looking to purchase some of his properties, but he’s not willing to sell. “I’ve seen a number of my investments double over the years, and that’s encouraging. I see the real estate market continuing to strengthen. I recently started my own property management business called Magis Property Management. I just got my first contract with a large building in the city. I figured that since I was managing 70 units already, I could grow that part of the company.”
Seeing all of these small and mid-sized developers proliferating the city is very encouraging. We are no longer endlessly waiting for our housing stock to be upgraded. Instead there is a demand for properties that need to be fixed up. Thankfully, there are people like Jeff who have the knowhow and desire to get the jobs done – people who see a wreck as an opportunity. Now, if we could just wrestle more real estate away from the hands of unruly owners who for various reasons aren’t looking to sell their blighted properties, then we would be in even better shape. Can we think about some creative ways to do that Mayor Brown?
Get connected: D Squared Property | Jeff Danahy | Partner | 716-725-2833