Michael Capital Closes on Rainier View Homes

We are excited to announce the official closing of Rainier View Homes on September 10, 2025, for $4,550,000. This property is an 11-home detached condo community located at the south end of Lake Washington in the Skyway neighborhood of Seattle. The area has a median household income of $113,511 and a median home value of $634,331, both of which exceed our buying criteria and pro forma sales assumptions. Built in 2018 to condo quality, the property offers spacious two- and three-bedroom + den floorplans averaging 1,300 SF.

• Purchase Price: $4,550,000 (acquired at $414k per home / $319 SF vs. comps at ~$668k / $532 SF)

• Loan Amount: $3,916,000 (75% LTC / 50% LTV)

• Debt Yield: 50% (net proceeds including cash flow / loan); includes $125k in closing credits

• Equity Multiple: 2.53x

• Exit Horizon: 12-17 months (individual sales)

• Homes were appraised in 2018 at $615k each

• Acquired at 26.61% below replacement value ($6.2M build cost in 2018), excluding $125k in closing credits.

• Address: 12672 60th Ave S, Seattle, WA 98178

• Year Built: 2018

• # of Homes: 11

• Property Type: Single-Family Homes

• Unit Mix: 5x 3bd/2ba/den, 6x 2bd/1.5ba/den (averaging 1,300 SF)

• Net Rentable Square Feet: 14,300 SF

• Land Area: 40,003 SF

• Occupancy: 73% (we opted to not renew or re-lease expired leases during due diligence period)

• Current Rents: 18.5% below comps for 3bd/2ba (24.4% lower PSF); 12% below comps for 2bd/1.5ba (63.9% lower PSF)

• Solar‑ready roofs, energy‑efficient HVAC, in-unit sprinklers, and low‑maintenance exteriors.

• Homes feature engineered wood flooring, quartz kitchens with stainless steel appliances, in‑unit washer/dryer, A/C, vaulted ceilings, spacious patios, and private rooftop decks. Residents enjoy a landscaped pocket park and dog park, stunning panoramic views, 24 parking stalls (with two dedicated parking stalls per home, plus two guest stalls), and quick access to I‑5, downtown Seattle (9 mi) and Renton (3 mi).

Our past property acquisitions have all been found off-market through cold calls and sheer persistence, but in this case we partnered with a broker whom I first met at the University of Washington. This broker reached out to us presenting the opportunity, knew Garrett’s townhome development experience, and worked with us to present the strongest offer to the seller. We were up against three competitive offers, but ended up securing it due to our higher purchase price (we were able to offer more due to the upside of the conversion) and our track record; even though our due diligence period was longer. Having our advisor on board that owns a successful multifamily real estate development firm helped our credibility, since we lacked direct expertise with this type of rental-to-owner-occupied conversion.

Many investors viewed Rainier View as a stabilized rental community, but that strategy required heavy cash equity to pencil. Instead, we saw an opportunity to convert it to owner-occupied housing and unlock additional value. This allowed us to pay more than other potential investors.

Detached, two-story condos with vaulted ceilings are highly desirable in the Seattle market, especially compared to the typical three-story attached townhomes with shared walls. The homes were built to condo quality with little deferred maintenance, which helps keep costs low. Additionally, they were built to 4-star green standards, meaning the homes featured low-VOC finish materials, WaterSense low-flow plumbing fixtures, and Energy Star rated appliances, along with blown-in insulation and energy-efficient windows, a big selling point in Seattle. There are very few similar properties in the market, making this property unique and less competitive when listing for sale.

We acquired the property at a significant discount to both replacement cost and recent comparable home sales. Immediately after closing, we invested ≈ $100,000 into landscaping improvements, interior and exterior painting, deep cleaning, pressure-washing, restriping the parking lot, and minor fixes on vacant homes and common areas. Notably, we received $125k in credits from the seller at closing to help fund these renovations.

As leases expire, we will list homes individually—targeting ≈ $735k for 3-bedroom homes and ≈ $685k for 2-bedroom homes; still below the latest Skyway starter-home sales. We expect the full sell-out within 12–17 months, with potential acceleration through lease buy-outs. If we meet these projections, we are expected to see a ROI of 153%. In a separate article, we’ll go into detail on our underwriting/proforma analysis and walk through how we analyze deals, assess assumptions, mitigate risk, and select partners.

To avoid short-term capital gains on ordinary income, we will likely 1031 exchange into another property and keep the train moving forward. We are close to going under contract on a retail strip center down the street from the property and will use the profits from this deal to fund the down payment and renovations for that one. If that falls through, we are evaluating other potential opportunities, but it is important that we 1031 the proceeds to limit tax exposure. If you are a broker or property owner considering a sale, we’d love to connect–please reach out to us.

We secured a $3,916,000 loan from a credit union based in Idaho, with a fixed 3-year term at 6.50%, with one 6-month extension option, along with a 1% loan amount origination fee. Prior to proceeding with this party, we engaged with over 20 credit unions and banks. In our next article, we’ll go into detail about how we solicited these CUs/banks, the offering memorandum we created, and what these institutions look for when evaluating similar opportunities. With each home that is sold, a minimum of $356k will be applied as principal toward the loan.

Garrett and I each invested $80,000 and rolled in our 5% management/acquisition/disposition fee ($227,500), for a total of $387,500. The rest of the equity was funded by limited partner (LP) capital.

We’re moving very quickly: We will finish renovations by the end of this week, stage the model home, prepare to list the 3 vacant homes (marketing materials, website rainierviewhomes.com, signage, photography/video, 3D Matterport tours), and schedule a broker open house. These homes will go live on the market on 10/1. With the ongoing changes to interest rates and the overall micro and macro environment, we will finalize our list prices for these homes this week. Our goal is to welcome families into new homes as soon as possible and to complete sales within the next 12–17 months.

If you’ve made it this far, thanks for sticking with us! Please leave a like and drop a comment—we’d love to hear what you’d like us to cover next about this deal. We’re committed to being transparent with our operations and are always an open book when it comes to sharing lessons learned, challenges, and how we analyze opportunities like this.