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This proposal is for the acquisition of a distressed multi-family opportunity in Houston, Texas. The property has easy access to highways, shopping, places of employment, parks and recreation in a working class area. The property became distressed after Hurricane Ike and currently has a 30% occupancy.
The property can be acquired for a fraction of the cost and rehabilitated. After completion, with an aggressive lease-up plan, the property can achieve 90% occupancy since the immediate properties average above 90%. The turnaround can be achieved in 8 months.
The funding required is $8M which is a 65% LTV of the after completion value. The property value will be $12.6M calculated from a 10% cap rate on a proforma NOI of $1.26M. The property was sold for $12M in 2007.
I am seeking an equity partner or private lender to fund the project secured with a 1st lien on the property. If required and included in the costs, the proposed proforma secures interest payments of 10% to the private lender during the turnaround. The proposed exit strategy is the sale of the property at 12 months including the 8 months of rehab and lease up and 4 months of marketing. The partner's equity share plus the interest payments would net an IRR of 37% after one year.
Please contact me at email@example.com for more information if interested on being an eqity partner on the deal.