In addition to being a REALTOR, I am an investor myself. I have "flipped", but I also hold rental units, I too am currently moving into commericial apartment buildings. My question back to you is, "Why are you not buying the apartment building now? What is holding you back?". If your properties are cash flowing and you are able to live off of the cash flow, then you are doing something right. As of now, you have 5 roofs to take care of, 5 buildings to maintain, 11 tenants to manage, and your vacancy rates affect you more heavily. Yes, you should consolidate into an apartment building, but maybe not in one chunk. Bigger unit properties usually give you more bang for your buck, if you do your due diligence. You have 5 properties cash flowing and you need the money to live off of (in a modest lifestyle). Here are a few options to think about: 1. Take equity out on one or more of the properties and use some of that money to live off of, but take as much as possible to buy another Commericial size apartment building (6+units) that is still providing you more cashflow than you were making, even after the refi/HELOC. 2. Find Private (not hard money) Money lenders to loan you the downpayment or partner with you and make more cash flow to add to what you are already making. 3. Sell one of the properties and do a 1031 Exchange into a commericial apt. building 4. Talk to other commericial apt. investors and get their knowledge and apply it.
Whatever you do: research, know the numbers, calculate higher expenses then stated, look at the buildings income/expense statements for "actual" figures for multiple years, consider the tenants and are these the tenants you want, have a management company for the larger complex or are you willing to do it all yourself, -- Be "smart", research and be prepared, but don't let fear stand in your way. I might not be the conventional response or person replying, but I'm providing some advice. How would you rather get your cashflow, small unit buildings or big unit buildings? The decision is yours in the end and so are the results (good or bad).
If you have to sell all of your smaller properties to purchase one larger property, it may not be the right choice. One thing you have now is flexibility, if you get into a financial trouble you can sell one property and still keep your other properties and not be out of busines. If you overextend financially and only have one larger property, you'd have to be able to sell that and then you'd be out of business. My advice is to plan for the unexpected and keep as much flexibility as possible. If you're ready to expand your holdings, why not add another 4 family and multiply your properties that way until you're in a more comfortable financial position?