Despite its long-suffering reputation, Cleveland's real estate market seems just fine to Kosta Almiroudis, an entrepreneur who moved last year from New York City to Lakewood to revive dilapidated old apartment buildings for fun and profit. In the past year, he has bought, renovated and fully leased more than 50 once-vacant units.
"I come from a village in Greece that has a 1,300-year-old castle," says Almiroudis, whose wife's family also lives in the Cleveland area. "So I love acquiring these 100-year-old buildings and bringing them back to life."
The first project that Almiroudis tackled is a 45-unit apartment building situated on Detroit Avenue across from the former Phantasy Concert Club. When he first began visiting his wife's family in Cleveland, he was surprised to learn how affordable real estate prices were. "I sold a single-family home in Greece and had a down payment for a 45-unit apartment building," he says with a laugh.
Since then, he has bought and fixed up another 12-unit building and signed a contract for an additional 11-unit building next door. All of his properties are 100-percent leased. He says the key to being a successful landlord is purchasing distressed properties for no more than 60 percent of their current value, investing up to 85 percent of their post-rehab value and overseeing the work yourself.
Even so, getting a loan was no walk in the park. Lenders are still skittish because they're carrying bad loans from investors who got in over their heads during the boom years. Still, the only way out of the current housing mess and the surfeit of vacant, multi-family buildings is through lending to good investors, he says.
"I don't see many people doing what I'm doing now, most likely because the banks are not releasing funds for these kinds of projects," he says. "They have the money. The only way to put this neighborhood back together is with banks releasing funds. Private investors want to put money back into real estate."
Almouridis, who was weaned on interior renovation projects for the likes of Donald Trump while starting out in New York, isn't holding his breath for an avalanche of easy money, however. Instead, he's partnering with a private investor who sees apartments as a safe bet at a time of low homeownership, high apartment occupancy and wild, tough-to-fathom stock market swings. Together, the pair intend to purchase and rehabilitate additional apartments in Lakewood.
The value-laden properties are plentiful, he says, in part because the professional children of Lakewood's middle-class landlords seem to want nothing to do with rentals. "I think maybe it skips a generation," he says with another laugh.
Source: Kosta Almouridis
Writer: Lee Chilcote