In July 2021, we made our largest acquisition to date: The Labor Lofts, a 17-unit apartment complex in Muncie, Indiana. This off-market deal came from a local business owner who had transformed an old General Motors labor building into fully renovated apartments. It was a unique opportunity with a lot of upside—and, as we later learned, a lot of lessons.
At the time of acquisition, the property was about 70% occupied, mostly by traveling nurses. The business plan was straightforward: maintain as many short-term renters as made sense while shifting toward stable, long-term tenants paying market rent. With utility bill-backs in place, this offered a clear path to improved and consistent cash flow.
But the path wasn’t as smooth as expected.
Property Management: The Make-or-Break Factor
Over the course of the first 30 months, The Labor Lofts saw three different property management companies. The first was local but grew too fast, prioritizing their own portfolio and leaving our asset as an afterthought. The second was experienced, but only with single-family and small multifamily properties—not apartment complexes like ours. Eventually, we returned to the original manager, only to face more of the same challenges.
That’s when we made a major decision: to start our own management company, Thrive Property Group. Managing The Labor Lofts taught us that the success of any investment is deeply tied to consistent, focused management. Without it, performance suffers—no matter how strong the asset.
Location Lessons: A Quarter Mile Matters
Another lesson we learned the hard way? A quarter mile can change everything.
While the property itself was beautifully restored, it was located just one-third of a mile past the “right” side of the tracks—literally. That small difference in location created an uphill battle for attracting new renters. The perception of the area worked against us, despite the quality of the building.
Fortunately, once prospective tenants stepped foot on the property, the sell became easier. But this was a detail we didn’t fully anticipate in our original underwriting.
The Results
Despite the challenges, the investment delivered strong returns:
- Purchase Price: $814,000
- Sale Price: $990,000
- Invested Capital: $199,000
- Return of Capital & Cash: $332,000
- Equity Multiple: 1.66x
- Average Annualized Return: 18.5%
Download the Full Case Study
Want to dig deeper into how this deal was structured, the full timeline, and the key takeaways that shaped our management approach moving forward?
