Metro and I were a little behind the 8 ball on getting everything completed so we vowed to pull an all nighter if need be. Putting the deal structure together took some creativity but we came up with a pretty good capital stack that threw off decent ROI’s and IRR’s plus we made a little bit of money with no money out of our pockets as developers…couple hundred thousand. Another reason we wanted to go with a for sale product was so we did not have to have an operating business and we could walk away when it was completed and start another venture. When we did the sale comps for both the office condo’s and the residential, the numbers were stronger than for the market lease rates and thus crystallized the for sale vs. for rent route. We had equity investors getting 30% ROI’s and 20% IRR’s, mezz debt guys getting 24% ROI’s and 16% IRR’s, and the land owner getting 20% ROI and 13% IRR. We were making $18,000 but we also had other fees built in so in the end with developer fees, commissions and our share of the profit we were up to $200,000 but we backed out taxes and insurance and put in a $25,000 contingency so it dropped it down to approximately $100,000. After getting all the numbers put together and creating the spreadsheets we had to get in presentation format. That took longer than anticipated b/c both me an d Metro are anal about the details and formatting. We finally got it all put together and we shut it down about 3:30 am. At that point, we were going with it so we could at least get a couple of hours sleep b/f we had to present on Sat. morning. Good night and we didn’t even get to have any drinks b/f bed!!
It’s almost over,
J2M
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