Why Four Units Became the ADU Sweet Spot with Brian Koons

How many units can you fit on a property?

Brian Koons says that used to be the main question.

Now he asks a different one: What creates a good rental product in a good neighborhood?

Expanded Description

Brian Koons works in the San Diego ADU market, where high property prices make cash flow difficult without getting creative.

His focus is often on distressed single family homes and small multifamily properties where more units can be added.

Brian explains why he likes projects that end with four units. In his experience, that gives him a useful balance between density, parking, yard space, privacy, and easier lending compared with projects that move into the five unit and commercial lending space.

He also shares why distressed properties give him more flexibility. A project might be renovated and sold, sold with permits, completed and sold, or completed and held as a rental.

Brian also talks about how his thinking has changed over time. Instead of trying to squeeze as many units as possible onto a lot, he now pays close attention to livability and often prefers larger two and three bedroom ADUs.

Key Topics and Takeaways

• Why distressed one to four unit properties can offer several exit options
• Why Brian sees four total units as a useful sweet spot
• The importance of parking, privacy, yard space, and neighborhood character
• Why Brian now prefers larger two and three bedroom ADUs in many projects
• Why current cash flow is only one part of his long term investment thesis
• How Brian uses different architects and contractors for different project types

Guest Information

Brian Koons is a San Diego developer and development manager.

He spent eight years in the Marine Corps before moving into development. He later ran development for a company with 580 projects before starting his own business.

Today, he manages projects for himself, investors, and property owners who want help building ADUs.