Business Plan Summary
Every business plan tries to convince you to invest. I would like to suggest that you use the real estate appraiser of your choice to verify the real estate projections in the business plan. Independent opinion is the best way to give you the information you need to judge the safety of the investment. Start not by looking at the business plans predictions, but as a simple development of this lake front property. Once you know your total investment is secured by real estate, then look at the business opportunities in the business plan.
There are 3 possibilities for investment.
1. Complete the construction $350,000
2. Complete to make the business year round. $200,000
3. A simple re-finance. Assume the loan on a property that is $30,000 below its last appraised value.
Here are some obvious points that I would like to bring up.
The investor or investor group should hold the mortgage on these two lake front properties and be in full control of any construction that would alter the value of the property. One property is completely paid for and I am willing to surrender that property towards the final agreement and put another mortgage on it.
The basic construction plan is to start with a simple steel building, add two mezzanines, and then a masonry veneer (similar to the style found at the Olive Garden) to transform the plain steel building into a lakefront mansion.
Considerable savings can be obtained by having stamped and dyed concrete floors. Any other type of flooring can be applied over the stamped concrete any time later.
I would like to keep the same construction agreements in place. One of the engineers on this project is quite good. His name is George Runkle . Under his direction and frequent visits I have been able to cut costs dramatically by working as the general contractor. He also has a special needs son that might be able to benefit from this facility. The building itself is pre-engineered and has already been designed by Arco and can be built and installed 45 days after the foundation is poured. They will build, erect it and warranty it.
The difficult two level foundation going around the pool has already been poured. Grading and forms for the other half have been completed. The re-bar has been pre-cut and bent and is on site. The footings have been engineered.
The second half of the foundation needs about 14 days to complete. It may have to cure for up to 28 days before the building is erected on it. This means the simple steel building can be completed in 2 to 3 months from the "Go" date if the concurrent construction of the 2 mezzanines does not take more than 4 weeks from the time their footings have cured . No estimate of costs or time for the masonary veneer have been made. But this can be done at anytime after completion of the construction .
The investor should earn money on the mortgage of the property similar to the way any mortgage company would. Added to this would be a percentage of the business profits.
The property can be lost to the mortgage holder in the same way that it can be lost to any company that might hold the mortgage. ( ie miss 3 payments)
The money invested should be less then or equal to the appraised value of the developed land. Similar to any construction loan. I should be able to borrow against the equity of the property for the purpose of developing the business.
Facts
Property # 1, undeveloped lakefront - $100,000 appraised value. Paid for, No liens.
Property # 2, appraises from $150,000 to $250,000 depending on the appraiser.
$141,000 on the first, $41,000 on the second
Last appraised value used for our home loan was $210,000 in 2001.
Home occupation permit allows this property to be used for an aquatic and EMS instruction business and to be used as a residence.
Sits on a beautiful point of land surrounded by Lake Lanier with great access from GA 400.
Finished building will be 15,000 sq/feet. $250,000 to $350,000 needed for completion. The total debt, including the existing mortgage would be $30 to $40 per square foot.
Lake property typically appraises well over $100 per square foot and usually over $200 square foot. If the finished property appraises for $100 per square foot then there will be $900,000 in equity in the property when the building is completed.
The pool is operational and has produced slight amount of revenue. The pool is 12' deep, 25 meters long (82' ) and meets standards for establishing official swim times that can be used for National records. 5 underwater windows have been placed to record the flip turns and dive in entries of competitive swimmers. Computer analysis of the swimmers stroke using dartswim (www.dartswim.com) software , nutritional support including blood draws and analysis and a full work out area for cross training will pull this aquatic facility towards its goal of producing Olympic champions or top competing swimmers and athletes.
This is the key to our business and marketing strategy. Start with a solid foundation of athletics and build recreational activities on top of it. This business will then be able to house several special needs people who can live and work at the same place. They will not have to face the additional challenge of transportation to go to work. Instead of relying on a government program they will be proud contributing members of society. My son Cameron with Down syndrome benefits from using his body and has no limitations there. Pair Cameron with someone like George Runkles son who has a great mind but can't use his body and you have a team that could with a few other special people manage and live at this aquatics and EMS business.
