2016 03-08 EAC Community Weekly Newsletter
EXECUTIVE PARTNERS
Kevin Yoo, CEO
EAC Community was started with a vision. That vision is financial freedom.
Why does EAC Community exist? EAC is really not about real estate investing. It exists to create financial freedom. Real estate is simply a means of accomplishing that.
The vision is to create financial independence not for me alone, or the few Principals of the Executive Team, or for that matter all the members of the Community currently. We will do this for all who come to us with the same vision.
I have written this to hopefully ensure that EAC Community will thrive for many years to come We will not be around in a few years or certainly when a real estate market correction occurs if we do not share this vision. The how we accomplish financial freedom is currently coming to us and will come even more as time goes along. And the what we do in the form of ultimately attaining financial freedom will have an impact around us that will be both inspiring and revolutionary.
But we cannot forgot why we have EAC Community. Financial freedom means freedom from the power of money. It means money does not have power over us. Instead, we have power over money. EAC will create the machinery and the opportunities for each of us to gain that power. I ask that everything you do in EAC be done with that vision in mind.
I was inspired to write this after watching this TED talk: https://www.ted.com/playlists/171/the_most_popular_talks_of_all. Please refer on Simon Sinek, How great leaders inspire action. I implore everyone to watch it as well. If you do so, and if you believe and live the vision of financial freedom, EAC will surely not become another failed real estate company.
John Hostetler, COO
St. Louis update – I traveled out to St. Louis last week to check on our current project and find some new ones. We are in the prime buying season for flip properties, and we have two in the works about which we are very excited. Read below for more on those.
2835 Winnebago – The crew Lou hired for this property are flying through the project. We decided just a month ago to change the plans for Winnebago from a 4-plex with 3 shotgun 1-bedrooms plus a 3/2 townhome to a triplex with only one 1-bedroom, a single level 3-bed / 2 bath plus the 3/2 townhome. Appraisers, realtors, and our property managers all agreed that although we would perhaps lose $150 – $200 in gross rent potential, we would more than make up for it on both the appraised value, more importantly, result in units much easier to rent long term. All demo is complete, new roof installed, new lateral for sewer, framing is complete, all windows are installed, HVAC and ducting installed, all rewiring complete, and plumbing is starting today. Lou expects to wrap up within 4 weeks.
8100 S Broadway – We had to put this project on hold while the final tenant moved out, which happened last week. Because of the rain forecast for this week, Lou plans to begin the demo, sewer lateral replacement, new water line AND roof next Monday.
3152-3154 Oregon – We are ready to close on our rehab loan with Barnett Capital, just waiting for final figures from Barnett. This loan has taken much longer than expected, although fortunately there have been delays on mechanical inspections, so no work has been interrupted. Once through the inspections for plumbing and electric, this project should go quickly.
2913 Wyoming – Proposal for flip – We are excited to bring you an opportunity to earn 18% on a fantastic flip property in Benton Park West. We purchased this home in late February and have already completed a significant amount of work. This is a 3,200sf home that we will transform into a 3 bedroom 2.5 bath beauty. We have drawings from our architect (see attached) and have already demoed most of the interior and replaced the sewer lateral and main water line. See also the attached Investor Proposal.
Our agent, Mary Krummenacher, just sold a home just north of this one for $295K and it was only 2,200sf. We are using the same architect as Mary did on this home, we will hold true to her design ideas (light and bright) that worked so well, and also plan on improving on many of the details. See link for her sale:
https://www.redfin.com/MO/St-Louis/2816-Oregon-Ave-63118/home/62769364
We are being very conservative by setting the ARV at $250K, and as you’ll see from the Investor Proposal, even at that sales amount and 120 days market time, the project shows a nice profit. Mary expects to do much better, of course, but we want to be conservative in our expectations.
Please let me know if you have interest in this project and I will be happy to answer any questions you may have.
The other project we just put under contract and are still in the due diligence period. We are set to close on April 4th, so I will provide more information as that one nears.
Olga Levin-Diaz, CFO
Working with our new accounting intern to make sure we have a smooth transition from the previous assistant and teaching her the ropes of the rental reporting and data aggregation. Had a couple of issues with Feb rent reporting from our property managers, so working on fixing those and preventing future issues as well as on the current month rent collections.
MANAGING PARTNERS
Vil Nikollaj, Managing Partner
No updates.
Chad Urbshott, Managing Partner
No updates.
Tony Banawa, Managing Partner
No updates.
Joseph Jin, Managing Partner
Awaiting updates.
GROUND PARTNERS
Lou Ellis, Ground Partner from Jacksonville, North Carolina
Awaiting updates.
Steve Shaffer, Ground Partner from Southbend, Indiana
226-228 Cleveland:
Siding, Windows complete, insulation drywall scheduled
201 Cleveland:
On market, taking applications
2016 Berkley:
Rented
126 E Broadway:
Drywall repair, mechanicals, painting scheduled
Andrew Davis, Ground Partner from Orlando, Florida
602 Emma and 1215 Avenue L:
The proposed final orders have been mailed to the clerk as per local rule and are awaiting the Judge’s signature. The writs of possession will be issued by the clerk as soon as he signs the orders.
I’ll call the clerk tomorrow to get an update. As soon as we have valid writs I will call the process server to deliver them to the sheriff for service and eviction.
The judge has received the final orders and I’ve left a message with his judicial assistant to update me when he signs them.
Giovanni Gracias, Ground Partner from San Diego, California
4748 College Ave:
Project is down to the last details and expected to be completed by the weekend.
Staging is scheduled and ready to begin as soon final clean up has been completed
Professional photography will be taken after staging is completed
Estimated listing price will be $589K.
2672 Escala Circle:
Currently waiting to see if my realtor lender qualifies them for purchase through a private loan
If we dont have an answer by friday we will be back on the market by the weekend
New projected listing price will be in the $559-$589K range as comps have gone up significantly
12081 Calle de Medio:
Project has been completed and closed.
George Flint, Ground Partner from San Diego, California
1222 Muirlands:
Demo is complete
Framing is starting this week
Things are going smooth overall now that we have permits.
Once framing is done, we plan to start show the house off market so we can pre-sale it.
Pescas:
Demo done
Framing 25% done
Pool 50% done
Other ruff trades will start in 3 to 4 weeks
Once framing is done, we plan to start show the house off market so we can pre-sale it.
Other updates:
We feel very confident that both these projects will sell for at least our projected sales price. As well, we are going to start “off market” selling these houses once the framing is complete because of the overwhelming amount of interest we have had to date. Once framing is done, potential buyers will be able to grasp the house thus increase the chances of pre-selling before completion.
Latest Pictures:
John Allen, Ground Partner from San Diego, California
4336 53rd Street:
– We have signed a Purchase and Sale Agreement with Reza Shera for $700k, however we are waiting for him to sign and send back the executed version. I anticipate this happening in the next 24-48 hours.
– Once he signs, we will start expedited building plan check, which is a breeze in comparison to grading plan check.
Other updates:
Colony Drive
– While we wrap up 53rd Street, I have been hard at work obtaining capital for the equity side and the debt side of the 24-unit apartment project for Colony Drive. I submitted a detailed package to a private money lender who is interested in funding 85-90% of the total project costs. I anticipate a response and follow-up call this week to solidify the deal. This would leave around $500k of capital required for the equity side. I have a number of interested equity-side investors, and in the interest of maintaining our business relationship, I would like to extend the opportunity to the EAC community. Any investment would be contingent on acquiring this financing commitment from the private money lender. I have sent investment terms I am comfortable with proposing to John and Kevin to discuss with the investors.
Samuel Lord, Partner from St. Louis, Missouri
3441 Shenandoah:
Ellis Construction has taken over this project.
4759/61 Alaska:
Rented empty unit and tenant in. Occupancy inspection passed with a few minor items that must be attended but primarily having to do with some outside issues.
4552/54 Virginia:
Had replaced gutters and downspouts on building. Repaired some roofing at rear of building but upon inspection found flashing and parapet roofing damaged. Will speak with Lou Ellis. Need to make repairs to parapet and flashing and potentially roof over back balcony/deck.
1 unit still empty and awaiting confirmation on new tenant who is to move in mid month.
3501 Iowa:
Viewed property with Lou Ellis and explained issue along back wall. Will discuss further to see schedule as it requires some extensive work but would require Tenant on first floor to move (or minimum leave property for a short period of time). The group here is working to see if we can transfer them to Winnebago or Oregon property which both would suffice for section 8 and needs of the tenant.
3116 Michigan:
Walked property with Lou Ellis. Issues such as tuck point have been addressed by him. Tenants have not complained over the last month.
3438/40 Ohio:
Sewer lateral replaced and trench covered. Still need resolution to parking pad in rear of the building as well as repairs to the 2nd floor entry steps. Will discuss with Lou Ellis.
The post Samuel Lord, Partner from St. Louis, Missouri appeared first on EAC Investments.
Nathan Turner, Ground Partner from Ontario
4233 Comanche:
Property had multiple offers within a couple days of listing. We got an all cash offer for full asking price of $40K, subject to inspection. Our realtor is getting the utilities turned on for the buyer to perform their inspection, however we are sending in a contractor first to ensure there will be no issues once they are activated.
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