Hotel / STR Condominium Capital Raise and Partnership Proposal in Miami FL

[Cameron Jones]

Hotel / STR Condominium Capital Raise and Partnership Proposal:

The Team:

• Pink Development and Construction has 10 years of experience. 500+ closed brokered transactions of which the majority were for multifamily value add over the past 10 years. 50+ projects locally across all asset classes (Single Family, Multifamily, Hospital, Retail, Hotel, Industrial, University / School, etc). Pink Development and Construction is a vertically integrated ground up boutique development firm and self performs all design work, entitlements, permitting and permit holder / qualifier, construction management, lease up, and property management facilitation to a third party. Rob Ellis is the principal with 25,000 hours and 12 years in the industry on a local, regional, and national level in agency, appraisal, construction and construction management, financial underwriting, sales and contract negotiation, and preconstruction. The co-sponsor and construction hotel management partner qualifier PDSI has managed hotel projects both ground up and renovations in all markets of Florida including more than a dozen in the South Florida submarket. Pink Development’s philosophy is to be paid last only after the major capital partner is paid back with the guaranteed return performance contract.

Deal Introduction:

• Seeking strategic capital raise and liquidity partner to facilitate development in Miami's Little River neighborhood.
• Projected total project cost of approximately $22 million, inclusive of land, construction, and soft costs.

Market Overview:

• Miami experiencing surge in short-term rental demand, driven by increasing tourism and limited hotel accommodations.
• Favorable market conditions with high demand for luxury condos in desirable neighborhoods.

Project Location and Competitive Advantage:

• Located at 540 NW 79th St, Miami, FL 33150, along NW 79th corridor east of I95, adjacent to Miami Beach and barrier beach towns, paralleling Biscayne Blvd.
• Recent developments in the area demonstrate growing investment and development activity, enhancing property value.
• Competitive advantage as vertically integrated boutique development firm with self-management capabilities, ensuring operational efficiency and cost-effectiveness.

Development Details:

• Proposed development includes premium condominium project with approximately 101 units.
• Target market includes international buyers, particularly from Latin America, seeking luxury short-term rental accommodations.
• Pre-sale condo pipeline with strategic payment plan to secure early commitments and optimize cash flow.

Strategic Partnership:

• Partnering with PDSI, a reputable firm with proven track record in hospitality industry and successful collaboration on previous projects.
• PDSI's expertise and experience in hotel development adds value and mitigates risk in mixed-use development scenario.

Capital Raise and ROI Projection:

• Requesting $7.2 million in capital investment, representing 30% of total project cost.
• Anticipated equity payouts to capital partner ensuring annualized returns of 45% IRR.
• Projected exit strategy includes condo sales with expected return of $1.4 for every $1 of initial equity investment over a 32 month project cycle
• $5 million dollar equity buffer with Pink to protect investor downside with guaranteed return performance contracts

Velocity of Sales and Revenue Generation:

• Expected rapid sales velocity driven by high demand and strategic marketing efforts. We have a 32 month construction and sale lease up schedule with a 3 year term requested on the construction loan. Proceeds will allow for full payoff of the construction loan with more than a $5 million dollar buffer for market changes accounted for.
• Comprehensive sales and lease up strategy leveraging market insights and operational expertise to maximize revenue generation.

Contribution to the Deal:

• Deferred developer fee and self-performance capability to contribute additional equity.
• Expected cost savings of approximately $2-3 million through self-managed construction and operational efficiencies.
• Demonstrated ability to efficiently manage construction, sales, and lease up processes, maximizing returns for all stakeholders.

Maximizing Density and Continued Partnership:

• Utilizing hotel use to maximize density, allowing for 101 units and reducing parking to 58 spaces.
• Commitment to ongoing partnership with minimum one project per year, targeting minimum 100 units and 8 stories for future developments.

Business Model and Zoning:

• Ongoing and repeatable business model with potential for scalability and expansion into other high-demand markets.
• T6-8O zoning in Miami FL typically refers to a high-density, mixed-use zoning classification allowing for a variety of residential and commercial uses, making it ideal for luxury condominium developments.

Conclusion:

• Unique opportunity for strategic capital partner to capitalize on lucrative returns in Miami's thriving real estate market.
• Comprehensive proposal outlines clear path to success and robust return on investment.
• Join us in this venture to unlock value and achieve mutually beneficial financial outcomes.