+/- 200 Unit Multifamily Development
Southern California
Entry Elevation
Active Lifestyle
The 1-Bedroom Floor Plans
OPPORTUNITY:
- Off Market
- Entitled +/- 9.3 acre parcel - approved for up to 206-unit multifamily development.
- Site plan and building plans are being prepared for the MF development.
- The subject parcel is part of a 90 acre site that also includes +/- 244 single family lots that will be developed by a production builder. These lost are currently under contract with a large, public builder
- Close to empolyment, hospitals, higher education
THE OFFERING:
- Entitled land
- Purchase Price: $6,180,000 / $30,000 per door
- Due Dilgence: 45 days
- Closing: 30 days after Due Diligence
PROJECT SUMMARY:
- 206 Proposed Residential Units totalling +/- 172,000 NRSF and +/- 220,000 GSF
- Adjacent to parks and trails
- Core Southern California location
- Nearby Employers Include:
- Two Hospitals
- An multinattional software developer and service provider
- A university
- A military base
- Minutes from a freeway
- First year NOI projected at $2,476,000
- Unlisted asset
VALUE
Our ARGUS model shows a Project IRR of 15.5% and a Multiple of 2.2 for an 84 month Project using a 5 CAP on Reversion NOI
These assumptions include pricing recommendations by an independant market research firm and cost estimates from two large, well qualified General Contractors
Buyer / Investor must rely on its own Due Dilligence
FINANCIAL ASSUMPTIONS
Acquisition
$6,180,000
NOI
Year 1 - $2,540,000
At Disposition (approx. month 84, February 2025) - $2,857,000
Revenue
Net Operating Income - $13,391,000
Capitalized Rent - $57,764,000
Total Project Revenue – $71,156,000
Total Project Costs:
Excluding Finance and Disposition - $46,036,000 (64.7% of Total Revenue)
Including Construction Loan and Mortgage Interest & Fees - $55,239,000
Profit:
$16,483,000 available for distribution
Construction Debt:
$31,568,000
Total Equity:
+/- $13,750,000
90% Buyer/Capital Partner = $12,500,000
10% Developer Co-invest = $1,250,000
Mortgage:
+/- $37,386,000 brought on at stabilization
Equity IRR / Multiple
15.4% / 2.2
TIMING
This is an unlisted opportunity. The seller is a land developer who has delivered more than 30,000 lots to public and private builders over the last two decades.
They have received final approvals for the master plan in November 2017. Improvement and Grading Plans are being prepared now. It is anticipated a grading permit for the master plan can be issued anytime after January 2018.
Offsite improvements should take 4 months and will be completed by the developer of the 240 single family lots.
Onsite improvements for the multifamily parcel can overlap and could start after September 2018.
The overall construction cycle is projected to be 24 months. Stabilization is anticipated to occur in month 32 (June 2020).
RELATIONSHIP
Ownership's is looking for an experienced buyer capable of closing expeditiously.