E140 How To Structure High-Risk Multifamily Deals in 2025

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In episode E140 of the REI Hot Seat, Andrew Hines and David Hulshof dive into the analysis of a power of sale multifamily deal in St. Catharines, Ontario—a 20-unit purpose-built building listed at $3.85M, significantly reduced from a previous $4.8M listing.

Dave emphasize that power of sale opportunities are high-risk, high-reward and should be approached only by experienced investors due to their “as-is, where-is” nature and lack of typical buyer protections such as condition periods and environmental reports.

The property features several vacant units with unclear renovation status, presenting a value-add opportunity — but due to its current condition, it will initially require bridge financing before becoming eligible for CMHC-insured refinancing post-renovation and lease-up.

They walk through the numbers using both stabilized and bridge-financing scenarios, estimating a 5.75% cap rate and ~$192K per unit acquisition cost.

After budgeting for approximately $280K in renovations across seven units and an additional $80K in bridge financing costs, they demonstrate that, if executed well, investors could achieve a 1.2 debt coverage ratio and retain the property with just $225K of capital left in the deal.

Dave stresses the importance of working with mortgage brokers and lenders who specialize in CMHC financing due to rapidly changing rules and underwriting complexities.

The episode also contrasts Canadian power of sale with U.S. foreclosure and “subject-to” financing strategies, noting that the latter enables long-term mortgage assumption at low locked-in rates, a major advantage in U.S. markets.

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E140 How To Structure High-Risk Multifamily Deals in 2025

0:37 – 20-Unit Deal Breakdown

5:15 – Vacancy & Rent Analysis

6:22 – Bridge First, CMHC Later

8:33 – U.S. vs. Canada Strategy

11:18 – Full Deal Structure

14:25 – CMHC Risks & Rules

17:06 – Final Numbers Breakdown

19:11 – No Inspection Risk

23:02 – 30-Day Irrevocable Offers

Disclaimer: This episode, as with every episode of this show, should NOT be considered as advice. Investment advice is NEVER given on this show. Always consult a competent investment advisor before making an investment decision.

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Andrew Hines is a seasoned real estate investor, business-builder, educator, and podcast host, well-recognized for his extensive experience in the field. Andrew graduated with an HBA from the Richard Ivey School of Business in 2008 and spent three years teaching introductory business at Western University as a Lecturer. He has been investing in real estate since 2011 and completing value-add projects since 2015, primarily in the luxury student rental space. Andrew started a project management company for building out new-construction townhomes in 2016 and has since built over 50 residential units throughout Southwestern Ontario. Andrew is an advocate for treating real estate investing like a business and uses his experience in his educational endeavors, coaching numerous investors on strategies to achieve financial independence and scale their portfolios effectively.

His podcast, "The Andrew Hines Real Estate Investing Podcast," serves as a platform for sharing insights, strategies, and success stories, connecting a community of like-minded individuals passionate about real estate investing. With a background that blends practical investing experience and investor-focused work, Andrew has become a pivotal figure in the Canadian real estate investing community.