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
Year 1 - $2,540,000
At Disposition (approx. month 84, February 2025) - $2,857,000
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
$16,483,000 available for distribution
90% Buyer/Capital Partner = $12,500,000
10% Developer Co-invest = $1,250,000
+/- $37,386,000 brought on at stabilization
Equity IRR / Multiple
15.4% / 2.2
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 in November 2017. Improvement and Grading Plans are being prepared now. It is anticipated a grading permit 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. Apartment construction could start in September 2018.
The overall construction cycle is projected to be 24 months. Stabilization is anticipated to occur in month 32 (June 2020).
Ownership's is looking for an experienced buyer capable of closing expeditiously.
Ownership would like to invest in the future development and is willing to contribute 10% of the equity needed to fund the project as a passive partner.
Ownership's preference would be earn an additional 'promote' position by contributing some management expertise during the final permitting process of site imporvements and building plan check.
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~ CA CLB B-861134 ~
~ CalBRE 01980301 ~
~ CalBRE 01744150 ~
~ OR REA 201008092 ~