January 20, 2025
Dear Investors, Underwriters and Friends,
Year number two of our operations at 5214 Stacy Road was a step in the right
direction. Net Income increased from $136,000 in 2023 to $203,000 this past
year:
After accounting for the capital returned to investors during this year, this
constitutes an 8.1% on investor capital. We expect to improve on that in the
coming year as we have 9 renovations to complete, with two scheduled to finish in
January and February of 2025.
One of our three major remaining capital improvements projects was completed as
the year turned over. You will see pictures within this report of the new exterior
painting of our building. The next two will be the installation of impact windows,
which will be costly, but should save use on insurance costs and will certainly be
recognized in any potential resale process. Finally, the resurfacing and re-pitching of
the parking lot is a project we will set aside for slowly.
Depending on the performance of our scheduled renovations, we expect to resume
distributions, on a quarterly basis in Q2 of 2025. The first set of distributions were
the result of accessing the remainder of our financing and we thing the property
should be essentially stabilized within the next 3-6 months.
From a market perspective, there is another property on Stacy Road that is coming
for sale. It is a 23 unit multi-family, which are all 3 bedroom 2 bathroom
apartments, just like our property. The owner is asking $5.7 million ($248,000 per
unit) for the property, which we believe is much too high for an unrenovated
property. For example, we paid $200,000 per door in a lower interest rate
environment two years ago. Certainly, we will be pleased if this owner succeeds,
but for now we will wait and see.
For now, we will continue to work on our property and endeavor to generate larger
and earnings for all of you. Thank you again for your trust and support.
-Clem
