Deal Abstract

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Adams Lynch Associates

Solid 26 unit in Cleveland Heights, OH for sale with a parking lot. All apartments rented to long term tenants with modest opportunity to raise rents, though maybe more upside with nicer finishes.

Part 1. The Basics

Question Notes
1. Property Name: Mayfield 26
2. Property Full Address: 2646 & 2660 Mayfield Rd, Cleveland Heights OH, 44106
3. Property Listing URL: https://adamslynch.com/properties.html?propertyId=932473-sale
4. Property Year Built:
5. Property Number of Units/Doors: 26

Part 2. Quantitative, Numbers, and Financials ("Sow Passion, Not easy mediocrity", or S2 P6 N18)

Criteria Amount/Comment
1. Link to Underwriting Google Sheet: https://docs.google.com/spreadsheets/d/1Yve_GA-_iLUz_kC_ufbvVKwoDQHD5o2iOWDfyCqi_mQ/edit?usp=sharing: UNDERWRITING COMMENT
2. Asking Price: $2025000: PRICE COMMENT
3. FFEIC Median Income: $102560: INCOME COMMENT
4. Last Year's Annual Rent: $277775: RENT COMMENT
5. Last Year's Annual Expense: $-116329: EXPENSE COMMENT
6. Last Year's Net Operating Income (NOI): $116329: NOI COMMENT
7. 5 Year Internal Rate of Return (IRR): 6.24: IRR COMMENT
8. Yearly Cash on Cash (CoC) Rate of Return: 3.5: COC COMMENT
9. Debt Service Coverage Ratio (DSCR): 2.09: DSCR COMMENT
Source

Part 3. Qualitative, Pre-Mortem, and Investor Fit (Every Time Man Profits, Don't Dismiss Serendipity)

Question Score Notes
1. Why is the seller now? TIMING SCORE TBD
2. Am I the right buyer for this deal? FIT SCORE 1. Solid size, potential value add; 2. Incomes in the tract are solid, in Cleveland Heights 3. Seems to be the right opportunity to drive efficiency
3. What has to go right for this deal to work out? Right Rating
4. People?
5. Distribution?
6. Durability?
7. Secret?

What has to go right for the startup to return money on investment:

1. Negotiate the price down lower to include capex; 2. Go higher on finishes to force appreciation; 3. Demographics on Cleveland Heights only improve

What the Risks Are

1. Asking price too high; 2. Limited upsides given they're all 1/1's mostly at market rent; 3. Operating expense very high at 40% without property management

Bonus Muhan's Notes

Wonder what the seller's motivation to sell is

Cool to recognize the two brokers, reminds me of my two other Cleveland Heights deals:

Violets Manor Underwriting & Deal Memo (Closing Date: 3/24/2025)
Mid-turn commercial apartment building looking for an investor to finish the job. Seven of twelve units are leased at $754/mth. Can renovate the remaining four, really renovate the other seven, bring up all units to market, then BRRRR?
Letters from the Courtyard by Muhan ZhangMuhan Zhang
Noble Villa Underwriting & Deal Memo (Closing Date: 3/27/2025)
Large multifamily in need of massive renovation at scale for sale. Property came under contract while underwriting but broker knows the other CLE multifamilies I’ve underwritten. Would be curious to see what the seller achieves with this property.
Letters from the Courtyard by Muhan ZhangMuhan Zhang

Updates

This is where I’ll post updates about the company. This way all my notes from offering to post-offering updates will be on one page.

Review these deal memos every time the startup raises a new round

Test if original thesis still applies

So, did I invest?

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