2015 12-01 EAC Community Weekly Newsletter
EXECUTIVE PARTNERS
Kevin Yoo, CEO
No updates.
John Hostetler, COO
I am now into completing the heavy documentation required for the B2R refinance. We have all properties done except for 1106 River and 504 Oak, both of which will be completed by the middle of this month. I still don’t have the appraisals back on any of them, but have asked again. Unfortunately B2R has changed the process for information flow and I do not have the access I had the first time around. Regardless, this is the crunch time and I intend to push hard to get this done before the end of the year.
We have also negotiated with our loan broker for more favorable terms for the portfolio loan on all of the South Bend properties along with Ave L in Florida. I anticipate signing the application paperwork on this loan by the end of the week.
We signed the contract to sell 2806 Magnolia Ave in St. Louis to Ameren Energy yesterday. I anticipate that this sale will close within 2 weeks, but of course it is an unusual sale so in case it is delayed, we do have a clause which will cover our holding costs.
Olga Levin-Diaz, CFO
Given our shift away from Appfolio, we have been working on and made lots of progress over the past couple weeks on creating the tracking tools we will use for performance of both the flips and the rentals. There is still a lot of work to be done, but I wanted to thank Vil who had dedicated a lot of time to working with me on this project. In the coming week or two, I will make some modifications to the rental performance spreadsheet we use for reporting and will share it with our property managers. This spreadsheet will feed right into our database for rental performance, so it is important to have a uniform format.
MANAGING PARTNERS
Vil Nikollaj, Managing Partner
2420 Upas:
– Delay in repaying EAC due to financing coming from IRA account and Thanksgiving Day holiday
– Expect repayment this week
2608 Magnolia:
– Signed revised contract with Ameren Electric Company. Awaiting final signed after legal finalizes.
– Plan to close ~Dec 7th
3152/3154 Oregon:
– Demo should be completed by Monday
– Roof to be installed Tuesday
Other updates:
Funding request for rental 8100 S Broadway
– $124,000 for 8 months (@15% ROI annualized)
– 4plex (4 x 2bed/1bth) with high cash flow
– Property located near local casino and plan to do extensive rehab
Chad Urbshott, Managing Partner
18110 Libby:
We’re really aiming to close for week of the 14th. Banking and ITIN delays have been the main hold ups. Garfield buyer is visiting Cleveland that week and can’t receive his banking docs without visiting a local branch (his account was locked due to some transfers.) The Libby buyer barely speaks English and it’s been a slow crawl….he is receiving his ITIN this week and should have the rest squared away.
Property is rented at $1000/mth.
4384 Ingleside:
Property was sold, but deal fell through due to Buyer’s financing difficulties. IIP has another lead on a cash buyer.
Property was rented to Sec 8 tenant but was moved out due to reckless behavior.
5750 Garfield:
Same as Libby. Property still vacant.
Linda Lin, Managing Partner
Awaiting updates.
GROUND PARTNERS
Lou Ellis, Ground Partner from Jacksonville, North Carolina
Awaiting updates.
Steve Shaffer, Ground Partner from South Bend, Indiana
226-228 Cleveland:
This 4 unit building plan has been completely changed. We have removed and framed each individual unit to accommodate 2 bedrooms, 1 bath laundry room, living area and open concept kitchen. All framing has been completed and we are in the process of having all mechanicals revamped to meet upcoming inspections. trees have been removed from the property to accommodate the parking area. The outside of the building is expected to be completed and closed up by November 29th. Once clearance is granted from the city, insulation and drywall will begin. Project is moving in the right direction and do not anticipate any unforeseen issues.
201 Cleveland:
The units have been placed on the market with an availability date of December 7 for move in. Units are being prepped for flooring, doors and appliances. Stand alone HVAC systems for each unit are in the installation process along with miner updates to plumbing and electrical systems.
1337 College:
Unit has been rented effective move in December 1, 2015.
1218 Bryon:
Unit has been rented move in November 1, 2015.
1154 Dennis:
Unit has been rented move on December 1, 2015.
2016 Berkley Flip:
Drywall finish has begun, outside of unit is being finalized prior to the snow. Once drywall work is completed, kitchen will be finished along with floor refinishing. Unit is tentatively scheduled to be complete December 30, 2015
126 E Broadway RBR:
Project is in the process of being evaluated for material and expected completion date.
Andrew Davis, Ground Partner from Orlando, Florida
Awaiting updates.
Giovanni Gracias, Ground Partner from San Diego, California
4748 College Ave:
– We are in the final steps of completion which include completion of punch list and staging
– Goal is to be done by this weekend and on MLS by monday.
– Projected listing price: $565K-$585K.
2672 Escala Circle:
– Property is on the market and we are getting a lot of showings with activity picking up now that the Thanksgiving break is over.
– We are listed on a range: $529K-$559K
– Final project pics can be seen here: https://www.dropbox.com/sh/6c25pk6wqgolgzg/AACrs1MrCP7HNj9a0Hulr4Wla?dl=0
12081 Calle de Medio:
– Property is still in escrow
– The buyer asked to push back the home inspection and appraisal to this week and both are taking
place Wednesday and Thursday
Other updates:
Currently putting in offers on several REO properties in San Diego County
George Flint, Ground Partner from San Diego, California
1222 Muirlands:
Not much new hear…..still waiting for permits.
Everything else is set and ready to go.
Fingers crossed this week we obtain permits.
Pescas:
Not much new hear…..still waiting for permits.
Everything else is set and ready to go.
Fingers crossed we obtain permits within 2 weeks.
John Allen, Ground Partner from San Diego, California
4336 53rd Street:
Not a whole lot to update on, as most of the work is done.
– The mechanical-electrical-plumbing plans are being done right now. Structural is nearly complete. We are nearing building plan submittal.
– The engineering firm for the grading plan is taking a little longer on their corrections than we would like, but it’s not putting us behind.
– Thanksgiving week is typically very slow in this industry, nobody really does anything. A number of the potential buyers showing interest are holding off until after the holidays.
– We have lowered asking to $925,000. While we were getting interest on the open market, it wasn’t as much serious action as he would’ve liked, so we made a move to lower asking in an attempt to generate a little more activity.
Samuel Lord, Partner from St. Louis, Missouri
3441 Shenandoah:
As EAC has already learned we were not complete on all projects that were slated to be done by this time. We were required to do a new drop ceiling in main floor bath to cover new drains, etc and frame out 2nd floor kitchen due the electrical cost of trying to make due with what was available and run outside the home. Framing did not get done in time which pushed electrical out until it is complete.
dropping photos into Dropbox.
4759/61 Alaska:
Occupants in 4759 have vacated the unit. One was hospitalized end of October and care provider (special needs) have not contacted us back after many attempts to find out if they will return. Police department contacted us concerning same and followed up. Other tenant was moved out by family members. As of December 1 we will validate as abandoned.
Issue in wall of 4761/A due leaking of pipes in wall. Will be removing old medicine cabinet and trying to find issue. There was no previous issue with tenants and no sign of damage prior to new tenant moving in.
Existing bathtubs and potentially sinks need to be re-cleaned and re-epoxied as the epoxy was not properly put on and peeling off. Sinks are the large and bulky original and would suggest changing out with new vanities and or pedestal sinks. We have redone 4761A vanity and tub during flip.
4552/54 Virginia:
4554B new tenant moving in this week (lease signed for December 1). During repair and paint we did find a leak on the front wall of the bedroom closet. Not too serious right now but will check out the front façade as it has ornate brick work and peak. Assume water coming into wall here. Will send before and after pictures of unit.
Making minor repairs as we move forward on this property. Primarily doors and poor quality bathrooms are the largest complaints. Like Alaska property, the bathtubs and sinks are in poor condition.
3501 Iowa:
3501A tenant moved mid month. Have turned apartment but will need new carpet as well as refrigerator and range. Looking at a way to install W/D connection. Drain in HVAC closet and electrical panel on outer wall of closet where they will go.
3501 had section 8 inspector who we walked through with. Awaiting report. This was during the roof replacement so some issues were already being handled through this. Other minor issues, inspector was not sure that there was anything that we would have to do other than she requested we make repairs to the back basement steps and archway as well as repair some of the basement walls. Also, kitchen faucet had issue (bad). Tenant used thinking it was just the sprayer and did not use it. Valve is bad and will replace the faucet and repair damage to bottom of the base cabinet. Countertop Formica pulling off and will do minor repair to fix issue.
3501B Repairs to ceilings (and clean up from the roof debris) to begin asap by Hays Const.
HVAC condenser lines and electrical on roof were both improperly installed. Lines were not run correctly nor electrical shut off properly secured (was laying on the roof open). HVAC contractor has sent us bid to make necessary repairs as well as disconnect, run properly both electrical and line set, as well as properly run through roof with proper flashings, etc. to ensure it does not leak. Presently one line runs up through roof (hole only) and other ran out of old flue.
dropping photos into Dropbox.
3116 Michigan:
Had sewer line back up. After multiple attempts to clear sludge from lines had to use high pressure water to clean from home to city main.
Sent employee Nov. 30 to repair electrical line that was supposedly faulty. Line was original to home and was defunct but never capped. Ran new line in its place.
3438/40 Ohio:
3440 Rodent (Squirrel) issue may have been alleviated. Called in professional service which set trap at only supposed entry point they could find. Four very large adult squirrels were caught and heavy duty screening was put in place around already screened entry.
3438 contacted us concerning some light water running down wall of shower from above. Was unable to reproduce issue during visit and all assumed it was the children splashing water out of full tub. Saturday Nov. 28 received another call after 3440 cleaned something in the tub and then had to plunge the lines. Was unable to recreate the issue again upon visit. Received call back later in the evening and now any use of the bathtub or sinks and water would run down the wall in the shower below. Nov. 30 in the early a.m. I removed the ceiling in bathroom above tub as well as the old ceiling. Both were soaked. Found drain pipe with a one inch split. Due it is original lead pipe we did a minor repair and put up a faux ceiling while we speak to our plumber for best option to fix.
With the weather changes and the property being tenanted we have seen some shifting of the floors which was expected with the piers in place. Also noticed some roof movement along parapets (slight).
dropping photos into Dropbox.
Other updates:
Starting to implement Lou Ellis suggestion to check units more frequently (although our tenants do call when light bulbs go out) his suggestion would short some of the issues such as those at Iowa over the long term.
Due some of the properties have very high ceilings we will in the future start using lighting that is easier to change light bulbs out of as most tenant do not have 8 foot step ladders and trying to remove glass light covers can become an issue.
Nathan Turner, Partner from Ontario
4233 Comanche:
We are still waiting for the seller of the loan to sign the substitution of trustee form so that we can list the property. The last that was communicated was on Friday Nov 20 when the seller said it was in process. Both myself and the servicing company called and emailed today for updates and to apply pressure to get this done.
Meanwhile the agent that did the BPO is very much on board and is looking forward to listing the property where she says she sees multiple offers on a regular basis.
Other updates:
I am looking into the possibility of listing the house without having the substitution of trustee signed yet as long as we have it before we close at time of sale. I’ll let you know what I find out.
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