NetLeaseX Realty Markets, Inc. is working with a real estate development group
to raise the required capital so that they can develop 74 single family
building lots on 38 acres in Lithonia, Georgia,
approximately 25 miles east of downtown Atlanta. The development group
has already begun the entitlement process and expects to receive their land
disturbance permit on July 30, 2006. They plan to commence construction
immediately thereafter and finish construction by October 1, 2006.
Specifically, a net lease investor will (a) purchase the project
for $1,185,000 and (b) provide $1,340,000 in additional financing to the
developer to cover specified development and soft costs. At closing, the
net lease investor will lease the project to the development group for 2 years
on a triple-net basis and grant the development group a 2 year option to
purchase the project for $3,800,000. Based on the development group's
proforma, they project that they can sell the building lots for approximately
$4,521,400 (net of sales commissions). Accordingly, the development group
expects to earn approximately $721,400 profit, while the net lease investor
should earn a $1,275,000 preferred profit.
Based on the above profit, the net lease investor’s IRR
will be 20.6% (based on a 24 month term) or 27.6% per annum (based on an 18
month proforma term). In actuality, the net lease investor’s IRR
will be even higher because a significant portion of his/her investment will
not be advanced until after construction commences.
If you would like to review a more detailed Executive Summary regarding this
net lease investment, please reply to this e-mail or call me to discuss.
Ron
_____________________________________________________
Ronald B. Zimmerman, President
NetLeaseX Realty Markets, Inc.
119 East Court Street
Cincinnati, Ohio 45202
Tel: (513) 861-1031 Fax: (513) 632-9577 Mobile: (513) 325-2909
