Financial Services

15% ROI on New Construction Equity Partnership Joint Venture (Bellingham, WA)

WWW.REDDOORDESIGNANDBUILD.COM

Red Door Design & Build LLC is the largest residential home developer in Whatcom County, located midway between Vancouver, B.C. and Seattle Washington.

OPPORTUNITY / CONCEPT

Red Door has identified an opportunity to build and sell mid and up range homes in desirable, established neighborhoods in Bellingham, WA. Bellingham, population 80,000 has been voted one the top ten places to live in the United States. There is currently a shortage of inventory in our target price range of 450k to 700k in Bellingham that leads us towards expanding our current business model.

Red Door is confident that we can produce high quality saleable homes in this niche market using our in-place production homebuilding resources, established design, as well as sub-contractor supply and management systems at very controlled costs.

Further, we can build these homes in a very tightly scheduled, expeditious manner.

The term of the investment would approximately be between 8-10 months from beginning to end.

EQUITY PARTNERSHIP OPPORTUNITY

Red Door expects to see increased profits from our market shift efforts by the end of the first year. To that end, we are seeking equity partners to supply capital for our expansion. Our program will net the investor a 15% ROI or 50% of the net proceeds, whichever is greater.

INVESTOR PROTECTIONS

1. The primary protection for your investment is that you own the project. We are very clear from the outset of our relationship that there is no other investment capital on the project other than yours.

2. The capital that you invest is placed in an account with a bank of your choice.

3. We use a monthly draw system that is submitted to the investor for review before funds are released to pay for work that has been completed and inspected on the project.

4. Our company takes advantage of having the lowest available costs for labor and materials because we are the largest production builder in Whatcom County and have long established contracts with our sub-contractors.

5. When the house sells…You as the investor will be paid first. You will receive your initial investment and your ROI (Return on Investment) prior to Red Door receiving any the net proceeds. We do not collect any management fees or salaries during the build.

6. You will receive 15% ROI (return on investment) or 50% of net proceeds, whichever is greater.

7. Our general contractor will provide us with a not-to-exceed quote, which means that we won’t have to deal with outrageous overages on costs for construction.

8. Your investment is protected in that our cost to build the home and your 15% ROI is far less than what the home would be worth once it is complete.

9. The total investment that would be required by to participate in the Equity Partnership Model for Red Door would be: $ 350,000 or less. (Exact numbers would be disclosed with a detailed proforma prior to the investment.)

10. Your investment would cover the cost of the entire build. (Lot, permitting, and a turn key home in an established desirable neighborhood.)

11. The house will be listed for sale on, “The Northwest Multiple Listing Service” (NWMLS). The Red Door CEO runs three reputable real estate offices in the local area with over 270 agents that will be dedicated to selling the homes. A lot of time has been spent on developing the sales price and com-parables for this business model.

12. We at Red Door would welcome any potential investors to come and visit our operation. We would be happy to show you existing homes that are currently under construction as well as thousands of homes that we have already built.

HOW DO I GET A 15% ROI?

Any shortfalls once the house sells, after we calculate your investment and 15% ROI, would come from our side of the net proceeds. We are building the homes for less than what used homes are currently priced at in our target market. When a home-buyer is given the choice between purchasing a new or used home in the neighborhoods where we build, our homes will be the obvious choice.

SAMPLE PROFORMA.

2800 Sq Ft Plan

Final Sales Price $ 550,000.00

Lot Cost $ 100,000.00

Listing Commission / 3.00% / $ 16,500.00

Selling Commission / 3.00% / $ 16,500.00

Construction / $ 71.43 / 2800sq.ft. $ 200,000.00

Sales Tax / 8.70% / $ 17,400.00

Permits $ 10,000.00

Design $ 2,520.00

Engineering $ 800.00

Closing Costs Escrow $ 379.00

Title $ 200.00

Excise Tax / 1.78% / $ 9,790.00

Total Cost $ 374,089.00

Gross Margin $ 175,911.00

Return (as percentage of Price) 31.98%

Total Investment from Equity Partner $ 313,320.00

We would love to work with you.

For more information please e-mail us or visit us at www.reddoordesignandbuild.com

Thank you,

Ceo / Member
Red Door Design & Build LLC
www.reddoordesignandbuild.com

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