August 16, 2018
Vacation rentals are underway at all three Goshen units but the vacancy rate is still higher than it should be in order to attract a buyer for the property. The property manager expects that the rentals will be stabilized soon as renters continue to post positive reviews online. Also, we have strong interest from student renters looking for a 9 month lease in September which will create the annual rent roll of an attractive investment property when coupled with the summer vacation rentals. The condo mapping process with the City is underway, as mentioned last update round, in order to maximize upside potential for the sale as an investment property.
Project Stage: Completed and Cash flowing.
Costebelle is finally on the market and looks fantastic. We hosted a San Diego Association of Realtors event the first week and received overwhelmingly positive feedback about the property and its ocean views. Our realtor team, Eric Iantorno and Brett Dickinson from Pacific Sotheby’s hold several price records including San Diego’s highest sales price ever ($24 million) so we are confident we have the right team in place.
Project Stage: Completed and on Market.
Felspar is completed and looking phenomenal. A neighborhood BBQ was hosted by the listing agents last week to build awareness about the property. The feedback from the neighborhood has been extremely positive, with many neighbors stopping in to congratulate and thank us for the project we have built in the neighborhood. The word has been getting out on the project completion and we are hoping to have these two great properties sold soon.
Project Stage: Completed and on Market.
We just celebrated a major milestone for Park Blvd last week as we received 1 out of the 2 permits we will need to build the project! The foundation and parking structure permit was approved on July 12th and we are currently working on the wood frame permit submittal. The process of securing a construction lending partner has begun and we are looking forward to breaking ground as soon as the wood frame permit is received. We are also down to four general contractors in the vetting process.
Project Stage: Pre-Construction. Foundation Building Permit Obtained.
The foundation subcontractor continues the tedious process of drilling shoring piles and setting the steel beams on the property that will anchor the extensive concrete and steel foundation to the hillside. We have also been working with over ten sub-consultants and over 50 sub-contractors to get the best bids possible on the remainder of the project.
Project Stage: Construction.
As you know, the DiversyFund Income Fund makes loans to the properties under development by DiversyFund, some of which are now on the market. Please see the project updates for details on the underlying properties.
The Growth Fund has made several preferred equity investments such as our Park Blvd multi-family project, Goshen (student housing) and Felspar (Pacific Beach condos), along with a small investment in Granito Drive. We are currently performing due diligence on a new multi-family value add deal.
We have officially closed on our Summerlyn property located in Killeen, Texas. The first items our team is tackling are Life Safety Code and ADA (Americans with Disabilities Act) repairs since those could be the biggest issues for a new owner’s liability. These initial repairs will include: Asphalt repair Resurfacing the tennis court Pool tile…
DiversyFund Q2 Investment Update Cash Flowing Multifamily. The Growth REIT continues to focus on acquiring multifamily value add projects that already have in place cash flows and can target 10% plus cash on cash yields while holding and 16-20% IRR’s over a 3 to 5 year hold. New Multifamily Deals The Growth REIT is under…
DiversyFund Q1 Investment Update The Growth Fund is invested in a brand new value-add asset named Summerlyn in Texas. Closing is anticipated next month for this new 200 unit project that is targeting an 18% IRR to the Growth Fund. Our real estate team is out in Texas currently looking at 2 other value-add opportunities…