Purchase After Fire?
Was about to close on a 5 unit brick apartment building, built in 1880- everything looked good (except the commercial interest rate) but it caught fire a couple weeks before closing. A tenant overloaded some wiring in the roof plugging in an air conditioner on a hot day, apparently.
Now the owner has contacted me and says he wants to keep the deal alive. He is working with his insurance company right now, but he says they will replace the rafters and put a new roof on it, replace the electrical system, and paint the whole house. He was considering asking more after the improvements, but says if we want to purchase it at our previous contract price he is still interested.
Can anyone see any potential problems with this, besides the fact that there are no tenants now? (It was fully occupied). Will insurance stay the same? Will the soaking the fire department gave it lead to problems down the road? Any other issues?
I thank you for any advice and input.
Chris
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