2016 04-05 EAC Community Weekly Newsletter

EXECUTIVE PARTNERS

Kevin Yoo, CEO

Home Today – Las Vegas

On April 3, 2016, I visited Las Vegas, Nevada to meet Christine Johnson from Home Today and Noah Herrera for Platinum Real Estate Professionals. Tony Banawa, our Managing Partner from Las Vegas brought this opportunity to EAC. We are considering investing in the fix and flip program from Home Today which is run essentially by Platinum Real Estate Professionals. In our efforts to gather a team of capable operators in multiple cities throughout the country, our goal is to sign up with groups who are dominant leaders in their markets. Home Today and Platinum Real Estate is such a group. I can attest to that having met with them in person and looked at all the properties that Noah currently has in various different phases of their process. They are very proficient at what they do and essentially has a 50:50 model for Investors where they manage all aspects of fix and flip. Tony will continue the vetting process but hope to have a deal from them soon for EAC.

John Hostetler, COO

B2R continues to be a thorn in my side. Kevin and I signed all loan documents on Thursday, March 24th, but because of their mistake of preparing 5-year term paperwork instead of 10-year, they are running it through one more final stage of underwriting. They requested clarification on items from their appraisal service last Monday and are awaiting those answers. I expect no issues, but the delays involved are nonetheless infuriating. I continue to follow up for updates and will let everyone know when we have a solid close date.

As such, Kevin and I have sent an underwriting package to Renovo to qualify for financing on our next package of properties. I have also reached out to Doug Goins, a broker who represents several portfolio lenders, to follow up on the latest on that front. Finally, I am in talks with two local banks in South Bend to negotiate a portfolio loan on those properties. I am laser-focused on securing the best and most efficient financing packages on our South Bend and Jacksonville properties which are ready or near-ready for refinance.

Olga Levin-Diaz, CFO

No updates.

MANAGING PARTNERS

Vil Nikollaj, Managing Partner

Giovanni Gracias
4748 College – listed on MLS for $539-569k. Great finish. Still need to get final approval. See link below.
http://bit.ly/202tjzR

2672 Escala – property still not relisted. Originally listed 11/25, pulled 1/8 for higher comps to close, then 2 months waiting for Realtor financing, which fell through 3 weeks ago. See link below.
http://bit.ly/1RVqq0D
http://bit.ly/1N5On0N

12081 Calle de Medio refi
– Still waiting for confirmation as to when/where the funds to replace Calle de Medio will come from.
– Imperial Beach duplex closed.
– North Park condo should have started rehab Fri 4/1.

George Flint
See George’s update. Everything is closing tracking the schedule.
Muirlands completion – 22 Sept
Pescas completion – 10 Aug

John Allen
Accepted revised cash offer with longer contract period.
Due Diligence Period: 4/22/2016 (21 days)
Tentative Closing Date: 5/16/2016 (45 days)

Chad Urbshott, Managing Partner

The Note in Texas with Nathan sold last week. Total investment was $18,500, profit is $13,800 for an ROI of 75% or annualized at 128%. EAC’s share of the profit is $7500.

Tony Banawa, Managing Partner

Kevin flew into Vegas on the 3rd and met in person, Noah from Platinum RE Professionals and Christine ith Home Today. They’ve done ove 1000 flips to date and over 130 last year. Currently they have 34 flips working.

Home Today is a HUD approved Counseling agency and developer that’s created a very unique ARR program(Acquisition, Rehab, Resale). Christine is the CEO. She has built relationships from her long time running First Look Program and Lease to Own programs. They are also one of the only ones doing a Short Sale buy back program that is slowly being recognized around the nation.

Kevin and I drove around with Noah from Platinum RE Professionals, one of the top RE Brokers in Las Vegas area. We saw about 12 rehab projects in different stages and different levels including B, C, and D class props.

He has 3 offices in town and has been past presidents of some of the popular Real Estate groups in town. Noah is also a lobbyist and is a community man with solid relationships from over 30 years in the industry in Las Vegas.
We are working on finalizing a JV agreement this week.

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:
Insulation and Drywall phase of project, projected completion on this phase April 15, 2016.

201 Cleveland:
Complete, 1 tenant upper, pending applications for second unit

2016 Berkley:
complete and rented

126 E Broadway:
Painters scheduled for completion of paint and drywall work April 10, 2016

Andrew Davis, Ground Partner from Orlando, Florida

602 Emma:
The other holding is the Emma, which we gotten order to throw everyone out, that didn’t do any good and we’re planning to sell that property which should be in a loss to EAC and get it out of our books and to talk to real estate agents to do that.

1215 Avenue L:
There are 2 properties that we own, one of them is half occupied and we just got the appropriate court orders to evict the other tenant, she is out. We’re getting to fix the empty/vacant space in the duplex which is Ave L, and our property manager tells out that it will be rented out very quickly. That’s a good holding.

Giovanni Gracias, Ground Partner from San Diego, California

Awaiting updates.

George Flint, Ground Partner from San Diego, California

1222 Muirlands:
Project is moving a long very well. Demo is done, framing has started and concrete work is in full swing. Ruff plumbing and ruff electrical should start in a few weeks.

Pescas:
Framing 80% done, ruff electrical, plumbing and AV start Monday the 4th.

Other Updates:
– 1370 Inspection Photos
– 1371 Inspection Photos

John Allen, Ground Partner from San Diego, California

4336 53rd Street:
– After a confusing couple of weeks negotiating with buyers, we are in escrow to sell 53rd Street. Summary of terms:

– $720k purchase price
– $40k commission for buying broker, $21.6k commission for selling broker
– 21 day due diligence period, 45 day close with seller option for 30-day extension
– Close only contingent on delivery of approved plans

It’s a fair offer and I am looking forward to closing this thing out. Grading plan is nearly stamped, just need to make minor changes to the formatting of the plans and we will be good. Building plans are also pretty much ready to submit, waiting on some information and preferences from the buyer/builder and we will submit.

Samuel Lord, Partner from St. Louis, Missouri

3441 Shenandoah:
Drove by Monday a.m. to check security system as was not responding. Found had been unplugged and moved.

4759/61 Alaska:
Notice from City concerning trash at back. Problem abated. Corner home rehab has cut down trees and stacked onto Alaska property. Trash/drywall was on their alley way. contacting city to ensure they understand it was the corner lot/rehab.
Fully occupied.
Will work on existing issues from inspections over the next week.

4552/54 Virginia:
4552B occupied over weekend.
4552A moved out and in process of cleaning.
Inspection notice states some things that were prior to first floor move out and most of which was alleviated. We will try to clean the carpets which are 6 months old but look more like 10 years now. Touch up paint required but overall condition of home in good shape.
Scheduled rain day this week to clean and begin necessary repairs. Already have some interest in rental.
Asking contractor to view roof and bid at least parapet/flashing issues which need to be addressed.

3501 Iowa:
1st Floor. Finally received call back from inspector. Advised that tenant must work with their social worker on staying until Winnebago may be ready. Spoke to tenant and she is working that end. We did receive Section 8 Payment today for April 2016.
We have abated issues as far as we can without starting tear out of some of the walls or working on the underlying issues.

3116 Michigan:
We gave Tenant notice of not renewing lease as of April 30, 2016. Tenants moved out over weekend. Overall property in good shape. Putting Simplisafe security system in and scheduling to have back on market in coming 2 weeks.
Will also go through basement and spray and try to abate any mold issue we may find. Will update.

3438/40 Ohio:
We have received complaints from both tenants about the back area. Pile of rubble, fence, and other debris still on site.
LTE will clean up and if approved, use existing demo waste containers at Winnebago/Oregon properties to dump.

Nathan Turner, Ground Partner from Ontario

4233 Comanche:
This property closed last week so Chad and I are going through final expenses prior to distribution later this week. I’m on the lookout for the next deal!