SAN DIEGO • RENOVATION + ADU DEVELOPMENT
Castana Street: Two Homes to Four
Two existing homes with deferred maintenance became a four-home property through full renovations and the addition of two attached ADUs. Carlos guided the development process from property evaluation through completion, with a focus on the owners’ long-term family wealth goals.
The project at a glance
Purchase: $365,000 in October 2014
Existing homes renovated: 2
Attached ADUs added: 2, each with 2 bedrooms and 2.5 bathrooms
Renovation costs: $130,000
ADU costs: Approximately $490,000
Appraisal milestone: $1.8 million as of June 20, 2024
Ownership strategy: Continued long-term hold
The opportunity
The Castana Street property began as two homes on a single lot in San Diego. Both needed substantial renovation. The owners wanted to improve the existing housing and build long-term family wealth through continued ownership.
The development strategy
The plan combined full renovations of both existing homes with two attached accessory dwelling units. Carlos recommended two-bedroom, two-and-a-half-bathroom units based on neighborhood housing needs and parking considerations. The goal was to increase the property’s value through improvements and additional housing while creating a property the family could hold for the long term.
From construction to completion
During construction.
Completed ADU exterior. Address digits removed for privacy.
From evaluation through completion
Carlos led property evaluation and development strategy, coordinated design and permitting, reviewed budgets, coordinated with contractors and represented the owners’ interests through construction and closeout. The project reflects the services H&M Development offers today.
Development feasibility
Evaluating site opportunities and the right development approach.
Pre-development
Coordinating planning, design professionals and permitting.
Financial and project analysis
Reviewing budgets and aligning project decisions with ownership goals.
Owner representation
Supporting decisions, monitoring progress and coordinating communication through completion.
The outcome
The completed property contains four homes: two renovated existing homes and two attached ADUs. Reported renovation and ADU costs totaled approximately $620,000. An appraisal effective June 20, 2024 valued the property at $1.8 million. The owners continue to hold it as a long-term family asset.
Owner-reported current rent as of September 2026 totals approximately $11,950 per month, equivalent to $143,400 annually at the current rent level. The property is self-managed.
Listed monthly operating costs are $220 for water, $120 for landscaping, $180 for solar and $540 for insurance, plus $19,500 in annual property taxes. These costs total $32,220 per year, with no paid management fee.
Allowing 3% of gross rent for vacancy ($4,302 annually) and 5% for repairs and capital reserves ($7,170 annually) leaves an estimated $8,309 per month, or $99,708 annually, before loan payments. This is an estimate based on the listed costs and allowances, not a historical cash-flow statement or guaranteed return.
Costs are owner-reported. The appraised value is a dated appraisal opinion, not a current valuation or sale price. The difference between purchase price and appraised value does not represent profit or investment return.
Four homes. One property.
The site plan places Dwelling 1 near Castana Street, ADU 1 and ADU 2 in the middle, and Dwelling 2 near the rear alley. Labels are anonymized to protect client privacy.
Conceptual illustration based on issued plans. Exterior details and landscaping are illustrative; not an as-built model or property photograph.
Financing and construction cost control
The project used a construction loan. To help control construction costs and contractor markups, a general contractor oversaw the overall project while Carlos and the owner team directly hired and coordinated specialty subcontractors for electrical, plumbing, HVAC and stucco. This approach supported the owners’ long-term family ownership strategy.
Explore your property’s potential
Considering renovations, ADUs or a long-term development strategy for your San Diego property? H&M Development can help evaluate the opportunity and coordinate the next steps.