WHITESTONE
REAL ESTATE PARTNERS
PACIFIC GARDENS
Co-GP Passive Investment
RETURNS
Expected (net) returns between 40-50% IRR and approx. 1.5x equity multiple within 18 months.
SPONSOR
EV Capital Partners
Location
25 McAker, San Mateo, CA
OVERVIEW
EV Capital Partners (“EV” and “sponsor”) is in escrow to purchase 25 McAker Ct (“Property”), a 38-unit townhouse style condominium in the heart of San Mateo, California. The anticipated closing date is December 17th, 2021. The property is being purchased at approx. a 21% discount.
PRE-SALES
EV is under contract to purchase the property for $34 million. EV began pre-selling units in late Oct 2021 to close simultaneous with the property. As of Nov 14th, three (3) vacant units and one (1) tenant-occupied unit are under contract. Sponsor expects six (6) units will be pre-sold and conveyed at closing. The remaining 32 units will be purchased for a net price of $27.5 million.
OPPORTUNITY
EV is pleased to present the rare opportunity to invest alongside the sponsor in the General Partnership (“GP”) position. Sponsor has executed term sheets with lender (Maxim Capital Group) to fund 69.5% of costs and Limited Partner (Red Starr) to fund 84% of the equity.
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Loan Proceeds of 69.5% LTC ($20.8M)
-
Equity 90% Funded ($8.2M from LP & sponsor
Sponsor is seeking equity investors to participate in up to $920,000 as co-GP equity.
-
Minimum: $100,000
-
Terms: Preferred 20% IRR (net), then share in 25% of the GP promote, pari-passu.
-
Returns: Expected (net) returns between 40-50% IRR and approx. 1.5x equity multiple within 18 months.
RETURN SENSITIVITY
Avg. Sale $ / SF
$835 psf
$860 psf
$885 psf
$910 psf
Investor IRR
31%
43%
51%
60%
Equity Multiple
1.4x
1.5x
1.6x
1.7x
SENIOR LOAN
(MAXIM CAPITAL GROUP)
Loan Type:
Loan to Cost:
Loan Amount:
Interest Rate:
Term:
100% Paydown until:
Paydown thereafter:
Origination & Broker Fees:
Non-recourse
69.5%
$20.8 M ($494 psf)
L + 716 bps
24 mos + extension
$300 psf
80%
1.5% + 1.0%
PROPERTY DETAILS
Address:
Location:
Year Built/Converted:
Unit Descriptions:
Unit Size:
Building Area:
Project Purchased Area:
Project Hold (Absorption):
25 McAker Ct
San Mateo, CA
1993 / 2021
3 Bed / 2.5 Bath
1,318 SF
50,084 SF (38 units)
42,176 SF (32 units)
18 months
SOURCES & USES
Uses
Bulk Condo Purchase
Exp. Pre-Sale Proceeds
Purchase Price
Legal & Closing Fees Working Capital (CapEx) Tenant Relocation
Financing Costs
Op. & Interest Reserves
Total Uses
Total
34,000,000
(6,510,698)
27,489,302
396,447
350,000
400,000
724,194
610,753
29,970,695
$/SF
679
823
652
9
8
9
17
14
711
SALE PROCEEDS
Total Exit Proceeds
Total WC & Cost of Sales
Net Exit Proceeds
Less: Debt Repayment
Less: Equity Repayment
Equity Profit
$ Total 37,352,143 (2,310,046) 35,042,096
(20,829,633) (9,141,062) 5,071,401
$/SF
886
(55)
831
(494)
(217)
120
CO-GENERAL PARTner Terms
Available co-GP Equity:
Co-GP Preferred Return:
Co-GP Equity Returns:
$920,000
20.0% IRR
51.3% IRR / 1.57x MOIC
LIMITED PARTNER
(RED STARR)
LP Contribution (% equity): Equity Investment:
LP Preferred:
GP Promote Thereafter:
LP Exp. Returns:
86%
$7.67 M
20% IRR / 1.25x MOIC
50%
32% IRR / 1.34x MOIC
