The former textile workshop in Istanbul’s historic Textile District was purchased for $89,000 (including agency fees and taxes) and converted into a 68 m² residential apartment. The location is in the city’s core, within walking distance of a metro station and surrounded by a mix of workshops, offices, and a few residential units.
Purchase and Location
- Price: $89,000 for 68 m² (≈ $1,300 per m²).
- Neighborhood: Textile District, central Istanbul, near Osman Bay.
- Typical building use: Predominantly textile workshops; residential units are scarce, especially those with balconies.
Renovation Scope and Costs
The property required a full gut‑renovation, converting an open‑plan workshop into a livable apartment:
- Structural changes: Added interior walls to create a bedroom, walk‑in wardrobe, dedicated workspace, and bathroom.
- Finishes: High‑quality double‑glazed windows, aluminum radiators, custom‑designed handmade tiles, industrial‑style lighting, and a half‑island kitchen.
- Balcony: Constructed a sizable balcony—an uncommon feature in this part of the city, adding significant market appeal.
- Furniture & appliances: Included air‑conditioners, a couch, and other furnishings.
Renovation cost: $35,000 total, or just over $500 per m². The budget exceeded the initial estimate of $400 per m² due to:
- Use of premium materials (aluminum radiators, custom tiles).
- Additional interior walls and built‑in wardrobe not originally planned.
- Inflation in construction materials and labor, which has risen roughly 20 % in USD terms over the past year.
If the same renovation were undertaken today, the cost would be about $600 per m².
Total Investment
- Acquisition: $89,000
- Renovation: $35,000
- Furnishings & appliances: ≈ $7,000 (likely higher now)
- Total fully furnished cost: ≈ $131,000
Market Valuation
Based on recent market activity, the apartment could be listed for $175,000–$180,000. Price growth in the area has been 10–15 % since the previous autumn, with some properties appreciating up to 30 % year‑over‑year.
Rental Income and Yield
- Current market rent: $950 per month (conservative estimate).
- Annual gross rent: $11,400.
Yield calculations:
| Basis | Investment | Annual Rent | Gross Yield |
|---|---|---|---|
| Total cost (incl. furnishings) | $131,000 | $11,400 | 8.6 % |
| Estimated resale price | $177,000 | $11,400 | 6.4 % |
The apartment’s central location, added balcony, and modern finishes allow it to command a premium rent. Short‑term platforms such as Airbnb could potentially increase the effective yield further.
Operating Expenses
- Property tax: $120 per year.
- HOA/common charges: < $10 per month.
- Management fee: 10 % of rent (paid by the tenant to the managing agent).
- Utilities: Paid by tenants (internet, electricity, water, etc.).
With minimal out‑of‑pocket costs for the landlord, net cash flow remains high, and vacancy risk is low given the strong demand for centrally located, fully furnished units.
Investment Considerations
- Legal contracts: Typically denominated in Turkish lira, but many rentals are negotiated in USD, requiring investors to manage currency risk.
- Liquidity: The property can be sold relatively quickly in a market with limited supply of comparable units.
- Scalability: Remote renovation and property‑management models have been successfully applied to multiple projects in the district, indicating a repeatable process for investors not residing in Turkey.
- Inflation exposure: Construction costs are increasingly tied to USD prices; future renovations may require higher budgets.
Overall, converting commercial workshop space into a high‑spec residential unit in Istanbul’s core can deliver double‑digit gross yields, especially when unique features such as a balcony are added in a market where such amenities are rare.
