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$4,300,000
Est. payment /mo
23,678 SqFt
UPDATED:
Key Details
Property Type Multi-Family
Sub Type Other
Listing Status Active
Purchase Type For Sale
Square Footage 23,678 sqft
Price per Sqft $181
Subdivision Hillman Addn To City Of Sioux Falls
MLS Listing ID 22503961
Year Built 1974
Lot Size 1.908 Acres
Acres 1.9078
Lot Dimensions See survery in Documents
Property Sub-Type Other
Property Description
Asking Price: $4,300,000. Willing to Sell Below Recent Appraised Value if Closed by June 16, 2025. Seller is willing to accept an offer below the recent appraised value of $4,960,000 if the transaction closes on or before June 16, 2025. The listing price reflects a 9.23% (with reserves included in this total) capitalization rate, based on the appraisal. To help facilitate a timely sale, the seller is prepared to offer the following concessions as a credit to the buyer at closing, in addition to the asking price based on the below appraisal, with an acceptable offer: a repair allowance of $104,400 (calculated at $1,200 per unit for 87 units), a commercial washer allowance of $2,400, a commercial dryer allowance of $1,600, a one-month 100% occupancy allowance of $69,165 (based on 87 units at $795 per month), and a security deposit transfer of $26,100 (based on $300 per unit for 87 units). The seller will pay and transfer the full amount of security deposits for all 87 units at closing, regardless of current occupancy. Between the reduced purchase price ($660,000 below appraisal) and the buyer allowances ($203,665) listed above, the total value of price reductions and concessions equals approximately $863,665—which represents 20.09% of the $4.3 million purchase price. Strategically, this creates the potential for an acquisition structure with little to no money down, depending on lender terms and buyer qualifications. A new survey was completed on April 25, 2025. Additionally, the owner has obtained an updated property insurance quote from a local Sioux Falls, SD insurance agent, reducing the annual premium from $54,810 (as stated in the appraisal) to $41,375. The quote is included in the Documents section. This updated insurance expense, which reflects a savings of $13,435, is not accounted for in the appraiser's analysis and would result in lower total operating expenses and a higher capitalization rate. The property is straightforward…consisting entirely of studio units. Each unit rents for $795 per month with a $300 security deposit and includes a bed frame, mattress, dorm-style refrigerator, and microwave. Units do not include stoves or kitchen sinks, reducing the potential for plumbing issues and costly appliance replacements. Landlord pays all the utilities, trash removal, snow removal, lawn care and repairs/maintenance. Each studio features a private exterior entrance and is equipped with a PTAC heating and cooling system, eliminating the need for expensive central HVAC, furnace, or boiler systems. These PTAC units are easy and cost-effective to replace when maintenance is required, minimizing both downtime and expense. The property also includes an on-site office, manager's unit, laundry room, maintenance, and storage rooms, and lacks interior hallways—greatly reducing common area maintenance responsibilities. General maintenance has been ongoing. Notably, the property received a new roof in 2021, and in 2022, repairs were completed on plumbing, electrical, interiors, and part of the exterior catwalk following a fire caused by a resident (under previous ownership). Property is located walking distance to a bus stop on Russell and SAM On Demand. Currently serving as a critical housing option for individuals who may not qualify for traditional market-rate or affordable housing programs, the property represents a potential valuable community resource. Additionally, construction and trade professionals are another strong fit for residency, as they typically seek affordable accommodations without the commitment of long-term leases—making studio-only properties an ideal solution. With some targeted updates and some TLC, and enhanced management, the property presents upside potential in both appeal and operational efficiency. Disclosure: Seller is a Licensed Real Estate Broker in the State of South Dakota.
Location
State SD
County Minnehaha
Area Sf-Nw01
Rooms
Basement None
Interior
Heating Electric
Cooling Window Unit
Appliance Refrigerator, Microwave, All Units
Exterior
Exterior Feature Stucco/Drivit
Roof Type Shingle Composition
Building
Story 2
Foundation Slab-on-Grade
Water City Water
Schools
Elementary Schools Garfield Es
Middle Schools George Mcgovern Ms - Sioux Falls
High Schools Thomas Jefferson High School
School District Sioux Falls
Others
Security Features Smoke Detector,Security Lighting
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Copyright 2025 REALTOR® Association of the Sioux Empire, Inc., Inc. Multiple Listing Service. All rights reserved
Listed by Brooks Commercial Real Estate • Jeffrey P Brooks