So, you want to buy a 100-unit apartment complex in Nairobi or elsewhere? My short answer is: You will likely pay between $5 million and $60 million. I know that is a wide range. The price depends entirely on where it is and what shape it is in. Think of it like buying a car. You can buy a used sedan or a brand-new luxury SUV. Both get you from A to B, but the price tags are very different. Let me break down the real costs as your trusted realtor.
The Price Per Door (The Easiest Way to Look at It)
In the apartment business, we talk about “price per unit” or “price per door.” This helps you compare buildings easily.
- The “Value Add” Deal (Older Building): If you look at an older building that needs some love, you might pay around $50,000 per door. For 100 units, that is $5 million.
- The New Build (Luxury): If you want a brand-new, fancy building in a hot neighborhood, construction costs are high. It costs between $450,000 and $600,000 per unit to build new today. For 100 units, that is $45 million to $60 million.
- The Middle Ground: In many average neighborhoods, a decent 100-unit building usually sells for between $400,000 and $600,000 per unit. That puts your total around $40 million to $60 million.
It’s Not Just the Price Tag (The Down Payment)
You cannot just bring a check for the full amount. You will need a commercial loan. Here is where the cash part comes in.
Banks are scared of risk right now. They usually want you to put down 20% to 35% of the purchase price.
- Example: If you buy a complex for $10 million, you will need $2 million to $3.5 million in cash for the down payment alone.
The Monthly Math (Can It Pay for Itself?)
You don’t buy a 100-unit building just because it looks pretty. You buy it because it makes money. Lenders look at something called Net Operating Income (NOI) .
Let’s do simple math.
- Income: If you rent 100 units at $1,000 each, you make $100,000 a month or $1.2 million a year.
- Expenses: It costs money for trash, management, and repairs. This usually eats up about 50% of your income. That leaves you with $600,000.
- The Loan: If your yearly loan payment (mortgage) is more than $600,000, you lose money every month. The bank will not let you do that.
Two Real-World Examples
Let’s look at two real listings so you can see the difference.
Don’t Forget the Other Costs
As your realtor, I have to warn you about the extra money you need to hold in reserve:
- Renovations: If the roof leaks or the parking lot cracks, you pay for it. For a 100-unit building, just tearing it down costs roughly $2.25 million.
- Vacancy: You need cash to pay the mortgage if tenants move out.
- Fees: Loan fees, inspections, and legal costs add up fast.
The Bottom Line
To be a serious buyer for a 100-unit apartment complex, you need to be a “real player.” Most banks will not lend you the money unless you have experience.
My advice: Do not look at the total price first. Look at the “Cost Per Unit” and the “Cap Rate” (the return on your investment). If the numbers make you a profit every month, that is a good deal. Find listings in nairobi by visiting Prime Vista Realty home page.
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