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MARGINAL · 49.4% MARGIN Under $250K project
#3 · 5828 Old Smithfield Rd, Apex, NC 27539
2.08-acre price-cut parcel, Old Smithfield Rd, Apex — public sewer at property, MLS 10133688
List price$165,000 (reduced from $225,000 — 27% price cut)
Acreage~2.08 acres (VERIFY — one source lists 1.22 ac; discrepancy must be resolved)
MLS10133688 (Active — Wake County, Apex)
ZoningRR — Rural Residential (current); Mixed-Use FUTURE land use designation in Apex Comp Plan
UtilitiesPublic sewer AT property; public water along Old Smithfield Rd — exceptional for Apex
StrategyCash buy, pursue MU rezoning aligned with existing future land use, resell entitled site to townhome or commercial developer; NO construction modeled
Out-of-pocket cash$218,050 (cash acquisition + entitlement costs + carry — no construction loan)
FinancedNone modeled — recommend cash acquisition for entitlement plays
ModeledEntitlement only; $500K conservative resale of rezoned site to developer (6–8 townhome site at ~$500K each = $3–4M GDV)
Max offer (20%)
$165,000 ask IS the play (entitlement only)
Pro Forma
| Line | Amount |
|---|
| Gross revenue — entitled resale to developer (conservative; $500K) | $500,000 |
| Land acquisition + closing (~2%) | ($168,300) |
| Entitlement costs — survey, rezoning application, legal, design (AT COST, no margin) | ($25,000) |
| Carry interest (18-month entitlement hold, 10% APR on equity deployed) | ($24,750) |
| Selling costs (~7%) — paid at sale closing, not out-of-pocket | ($35,000) |
| NET PROFIT TO INVESTOR | ~$246,950 · 49.4% margin · 113% cash-on-cash (IF rezoning approved) |
No build ARV applicable (entitlement-only). Entitled exit value of $500K is conservative — a 2-acre MU-zoned site with public sewer in Apex supporting 6-8 townhomes at $500K+ each ($3-4M GDV) could yield $600K–$900K+ land value to a motivated developer. Apex overall market: $241/SF median sold (Resideline, 704 closings YTD), confirming build-new single-family does NOT pencil on this parcel. Townhome/MU entitlement is the only viable path. Risk: rezoning is NOT guaranteed; model returns are only valid on approval.
Diligence Gates
GO: Public sewer AT property (uncommon in Apex); MU future land use matches desired rezoning; 27% price cut signals motivated seller; low entry at $165K.
VERIFY: Confirm acreage (1.22 vs. 2.08 ac — big discrepancy); confirm right-of-way and curb-cut situation on Old Smithfield + Bakers Alley; schedule pre-application meeting with Apex/Cary planning to assess rezoning feasibility and timeline (12–24 months typical); check 100-yr floodplain on parcel (creeks nearby); any prior rezoning denials on this parcel.
STOP: If acreage confirms at 1.22 ac (may be too small for townhome project); if Apex planning indicates MU rezoning is not supported at this location; if floodplain covers more than 30% of lot.
Verdict
MARGINAL — entitlement-only play with meaningful execution risk. If rezoning from RR to Mixed-Use is approved (aligned with the Comp Plan designation), investor nets ~$246,950 on $218,050 invested (113% cash-on-cash) at a conservative $500K entitled exit. Single-family build-invest does NOT pencil at Apex's $241/SF comp. The 27% price cut and confirmed public sewer make this worth a pre-app meeting with Apex planning before committing. Cost to pursue: $165K land + ~$25K entitlement work. Downside is $190K at risk if rezoning denied. Recommend as a watch for a buyer with entitlement experience and 18–24 month horizon.