The borrower is requesting a loan of $1,425,000 in order to refinance and renovate the underlying properties and to pay off existing taxes, liens, and other expenses. There is moderate renovation needed for the underlying property, totaling $237,288. The borrower will receive 4 draw(s) totaling $1,237,288 over the course of the loan. The initial draw in the amount of $1,000,000 occurs at closing in order to pay off the existing debt on the properties. The second draw of $94,000 will be disbursed after invoices are provided according to the Property Improvement Plan (PIP), to be submitted by borrower. The third draw of $94,000 will be disbursed upon receipt of visual proof (pictures, invoices, etc.) of purchases, upgrades and improvements made towards property renovation according to PIP, to be verified by third party vendor. The difference of $187,712 represents an allocation for escrow charges that include insurance, liens, taxes and fees, which will be paid from escrow directly. The fourth draw of $49,288 will be disbursed after final invoices for completion of the PIP are provided, to be verified by third party vendor. The borrower plans to sell the property.
2021-2023 Regal Dr.
- As-Is Value: $2,975,000
- Renovation: $237,288
- After-Rehab Value: $3,375,000
An independent third party appraisal commissioned by Patch of Land, shows an After Repair Value (ARV) of $3,375,000 for 2021 and 2023 Regal Dr. The ARV ratio is 42% and is in line with the data we found during our due diligence process. Our research shows the commercial market surrounding the underlying property in this area of Corsicana is stable and supply and demand are in balance.
|Investment Needed||Minimum Investment||Loan Duration||APR|
|Appraised ARV||42% Loan to Combined Appraised ARV||$3,375,000|
2021 and 2023 Regal Dr. were built in 1984, located in the commuter neighborhood of Corsicana, Texas.
2021 Regal Drive is a Super 8 Motel comprised of 2 two story buildings. The hotel currently has 48 guest rooms. 2023 Regal Drive is a Knights Inn comprised of one two story building. The hotel currently has 44 guest rooms. There is also a breakfast dining area.
The properties are located just off Interstate 45 near State Highway 31, within minutes of several restaurants and retail shopping; Splashicana (23-acre water park) scheduled to open Summer 2016.
2021-2023 Regal Dr.
Property renovations are underway now and there is moderate renovation needed for the property. The following renovations are planned to be completed:
- Install landscaping between buildings
- Install new signage
- Replace telephone and computer systems
- Update office and lobby
- Buy new ice machines
- Purchase and install new washer/dryer
- Purchase and install new furniture and fixtures
The Managing Member of the borrowing entity is an experienced hotel investor. He started his career in his family’s hotel business eventually becoming Director of Operations for a hotel group managing six limited and full-service hotels. He has a Masters degree in Hospitality Administration from University of Nevada, Las Vegas. He currently owns a Super 8 Motel and Knights Inn in Corsicana, Texas.