Secured a building in downtown core

I got my offer accepted on this one, so I will post here for opinion.

Firstly, I am not quite sure why I went after this building. Perhaps it is because the price is just too good and it can only increase in value.

The building is situated in the core of a small town of 12000 people. The town is very solid because it’s in a tourist spot, every summer it becomes very very busy. In the winter the town somewhat hybernates. The town only has one main road for shops and businesses, and this building is right at the centre of it, right across from the bank.

The building has 2 small shops on first level, the 2nd and 3rd level was used as a religious place. It got my attention because the building is very well taken care of, it’s BIG, and it was priced REAL low. The similar (actually smaller) sized properties on the street is priced at 400k, this one I got it for 200k! (i got some discount off price).

But of course I wonder why nobody buys it if it’s that cheap! Mainly because the 2nd and 3rd floor is currently without a purpose. Just 2 empty big halls. 2nd level doesn’t have windows, 3rd level has many windows. It needs some modification to be an office, but it can also be turned into a party room, or a small theatre. or again just for religious gathering. It can also be converted into residential apartments, but the cost would be too high to do that and the rent won’t justify it.

The shops can be rented for $900 each, but I have no idea what I should do about the high levels. I figured I will just rent out the 2 shops first to cover my carrying cost, and just put a FOR RENT sign on the 2nd window and see who might be interested, and then do my modification from there. The current zoning pretty much allows me to do anything there.

I still have time to do inspection and rethink my strategy, any comment? or suggestion of what I should do with the top 2 levels?

Parking capacity, number of bathrooms, fire suppression, and elevator access could be issues.

Obsolete commercial space is notorious for failing to comply with current codes and standards.

In older, wood-frame construction, the second floor traffic is often annoying to those on the first floor. Not to mention not very sound proof. Keep this in mind as you lease up the upper floor space.

Maybe the price is right, because the county/state is requiring more bathrooms, elevators, additional parking …or upgraded fire suppression. None of these are cheap fixes.

I didn’t think of those things, but it’s good to know. I will find out the details.