Working brief for Michael Colich · October 1, 2026
A small apartment building trades on its rent. The same units, sold one at a time as tenancy in common homes, trade on what a buyer will pay for a place to live. This page lays out that gap, the deals on the market today, and everything we have built to act on it.
Purchase at $1,295,000 for 3,400 sf. Four 850 sf homes sold at 6% under nearby condo prices.
The numbers
This is the model deal from the prospectus: a vacant Silver Lake or Atwater fourplex, light renovation, four homes sold individually. It is a model built on real sales data, not a property we own.
Each finished home is priced at 6% under the median of nearby condo sales of the same size. Our own match of 31 recent LA TIC sales against condos put the real gap near 8.5%, so we stress every deal from 1% to 11%.
Five or more interests triggers a state public report. Two to four does not. The fourplex is also where the spread is widest, because buildings get cheaper per foot as units go up while homes do not.
The seller handles any tenant buyout before closing. In Los Angeles the average recorded buyout is about $25,000 a unit. We do not use the Ellis Act.
Each buyer gets an individual loan on their share. National Cooperative Bank, 5th Street Capital and Meriwest are lending on LA TICs today, and a 30 year fixed option exists. Homes can close one at a time.
Four 850 sf homes, 9 month hold, vacant at closing
| Purchase | $1,295,000 |
| Closing costs, 2% | $25,900 |
| Renovation, 4 homes at $35,000 | $140,000 |
| Separating meters, entries, yards | $32,000 |
| Soft costs and contingency | $17,200 |
| TIC legal | $22,000 |
| Carry, 9 months at 10% | $74,115 |
| All in | $1,606,215 |
| Four homes sold at $614,943 | $2,459,773 |
| Selling costs, 5% plus marketing | ($130,989) |
| Net profit | $722,569 |
Where it works
The same model run across eight neighborhoods, using typical purchase prices and closed condo sales in each. The margin is net profit over all in cost.
| Model deal | Buy | Sell out | Net profit | Margin |
|---|---|---|---|---|
| Silver Lake / Atwater fourplex4 homes at $614,943 | $1,295,000 | $2,459,773 | $722,569 | |
| Mid-City fourplex4 homes at $496,952 | $1,150,000 | $1,987,809 | $428,629 | |
| Palms fourplex4 homes at $572,687 | $1,360,000 | $2,290,747 | $431,293 | |
| East Hollywood triplex3 homes at $588,665 | $1,117,500 | $1,765,996 | $303,366 | |
| West Adams triplex3 homes at $454,216 | $900,000 | $1,362,647 | $151,822 | |
| Echo Park house plus ADU2 homes at $699,504 | $985,000 | $1,399,009 | $146,688 | |
| Beverlywood triplex3 homes at $590,389 | $1,335,000 | $1,771,168 | $27,601 | |
| Venice fourplex4 homes at $823,882 | $2,675,000 | $3,295,529 | ($21,214) |
Live deals · pulled from the MLS
Every active 2 to 4 unit building and house with a second unit, priced against closed condo sales and run through the same cost stack as the model deal. Change any assumption or type your own offer and everything recalculates.
Unit sizes are the building total split evenly, so confirm real sizes before any offer. The full scoring steps are in the method section below.
Method
Same steps for every property, in this order. The sliders above change steps 6 through 9.
median comp $/sf × (1 + layout premium − TIC discount). Discount is 6%. Premium is 7.5% for a house with ADU or detached homes, 3% for a duplex, 2% for a triplex, none for a fourplex.exit $/sf × total living area, which is the sum of the individual home prices.(60% loan + project costs) × 10% × months ÷ 12 over 6 months. Selling 5% of sell out plus $8,000 marketing ($10,000 Westside).net profit = sell out − all in cost − selling costs, and margin = net profit ÷ all in cost. Ranked by margin. Pursue at 15% or better, negotiate from 5% to 15%, pass below 5%.Earlier calls
We have not bought anything yet. These are deals the analysis picked out in July and August, checked against the MLS today.
| Property | Our call | Today |
|---|---|---|
| 3556 Helms Ave, Culver City | July 21: best on the tour. Asking $1,499,000, we said offer $1.35M to $1.4M. | Sold Aug 21 at $1,435,000 |
| 5030 Farago Ave, Temple City | Aug 4: top of the live ranking at $1,775,000. | Sold Sep 10 at $1,720,000 |
| 5904 Dauphin St, Los Angeles 90034 | July 21: runner up, cheapest entry, four new homes penciled at a 20.8% margin. | Still active at $1,049,000 |
| 9051 Lucerne Ave, Culver City | July 21: works only if the three tenants can be bought out. Was $3,699,000. | Relisted this week at $3,490,000 |
| 11209 Sardis Ave, West LA | Aug 4: ranked on the optimistic screen. Units average 610 sf, too small on today's stricter math. | Still active at $1,320,000, 181 days |
Our work
Since April we have built the investor documents, a live deal engine, and the research behind both. Items with a link open here. The rest are in the company Drive under CCRE.
Decisions
The analysis is done to the point where the next steps are judgment calls, not more research.
Preferred return, profit split and minimum investment are blank in the prospectus. Nothing goes to an outside investor until those are set.
We underwrite homes at 6% under condos. The measured gap is closer to 8.5%, and one lender source says 12% to 18%. Move the discount slider above to see which deals survive.
Northeast LA has the widest spread and the existing TIC buyers and lenders. The Westside has fewer deals but higher prices per home. Pasadena does not pencil on existing buildings today.
If one of the listings above is worth a tour, I can confirm unit sizes, tenancy and rent control status this week and bring you an offer price.
We need a TIC attorney for the agreement and a broker relationship with 5th Street Capital before the first purchase, so buyers have financing lined up when homes list.
The model deal needs about $830,000 in cash at a 60% loan. That decides whether the first one is ours or a small raise.