Vacant Two-Unit Building in Mission Offers Many Options

Vacant Two-Unit Building in Mission Offers Many Options

The pair of vacant flats at 1183 Hampshire in the Mission is perfect for a variety of buyers, from TIC partners to investors or owner occupiers looking for rental income.

I went through 1183 Hampshire on broker tour this week and was impressed by the space and overall condition. The finishes are a bit dated, but it’d be pretty straightforward to do cosmetic kitchen/bath remodels down the line. The important thing is that both units are in move-in condition.

Each flat has two bedrooms and one-and-a-half bathrooms (with an office in the top unit), and there’s two-car garage parking and a yard. There’s also a bonus space (with a kitchen area but no oven) on the garden level. (It’s well worth noting that there’s no eviction history on the building, something that can affect both condo conversion and the amount of rent an owner can charge.)

Who are good buyer candidates for this building?
TIC partners who could condo convert: Two different buyers could partner up and purchase the building, each living in one of the flats for one year and sharing title (and possibly a mortgage, though fractional financing could also be available.) They could then pursue the condo conversion process, which would likely take another two years or so. (A condo lottery is not involved for fully owner-occupied properties.) The owners could offset their mortgage payments by renting out the bonus space—keeping in mind that it’s not a “legal” one. Or the bonus space would be a great guest suite for friends and relatives of each owner. Once the owners complete their condo conversion, they’ll have increased the value of their property by creating two individually owned condos.

Investors: Anyone seeking a solid San Francisco investment will find it at Hampshire. Projected rents for both flats and the bonus space would potentially bring in approximately $130,000 per year. The property has been well maintained and doesn’t appear to be a money pit by any means. You could also look into legalizing the unwarranted studio and what that would take. An investor would also benefit from what many would consider a prime Mission location near restaurants, bars, freeways, tech shuttles and BART.

Owner occupier and landlord: A buyer could purchase the entire building, reside in, say, the top unit, and then rent out the other two units. (I did this way back in 1998 and it’s turned out to be a great home and investment.) Whether you have the chops to be a landlord could be a big factor; it’s not for everyone. I’d recommend consulting a landlord-tenant attorney before you move ahead with this scenario, as you should be aware of how rent and eviction control will have an impact on future tenancies.

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Get in touch:

Eileen Bermingham

Zephyr Real Estate


BRE# 01352627

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