WEST LOOP PARTNERS
Chicago West Loop
$5.95M Project
9% Return on Cost
West Loop Partners
Fan Fan, MUP Jordan Feenstra, MBA Kelsey Shulan, JD Xutao Wang, M.ARCH
EXECUTIVE SUMMARY
WEST LOOP PARTNERS
Mr. Peter Allen
Stephen M. Ross School of Business
University of Michigan
701 Tappan Street
Ann Arbor, MI 48109
Dear Mr. Allen, Bank Representatives, and Future Partners:
1133 W. Randolph St. is a property that presents incredible opportunity for investment and growth. Located in Chicago, between the growing West Loop and up-andcoming Fulton Market District, and to the west of Restaurant Row, the Property is in a prime location to take advantage of the surge in activity west of the Loop.
The Development will entail a combination of two properties that will come together under a cohesive design that maintains the architectural charm that is typical of the
neighborhood and appropriate under the official neighborhood plan, while bringing the buildings into the 21st century with impressive glass construction and a stunning rooftop feature. The Property will include retail on the first floor, office space designed for a technology start-up incubator on the second floor, spacious condos
on the third floor, and a semi-covered rooftop with a year-round bar which boasts incredible views of downtown Chicago.
This architecture, mixing old with new, is representative of the neighborhood. The area was and still is largely used for meatpacking and food production. However, in
recent years, start-ups, award-winning restaurants, shops and gyms have made their way into the neighborhood. Now, the epitome of new, Google, has announced
they will move their Chicago headquarters two blocks away from the Property in 2016. With Google, will come more people and increase economic activity. 1133 W.
Randolph St. will be in place to help support and will reap the rewards commensurate with the anticipated market expansion.
Our financing strategy is prudent yet provides opportunity for outstanding risk adjusted returns. The aforementioned buildings will be funded with initial cash equity
and owner participation in the partnership. Initial Contractors and Developers will also participate via earned sweat equity. The remainder construction costs will be
funded by pre-lease tenant improvements, pre-sale condo deposits, and a term construction loan. Finally, a multitude of beneficial exit options exist including cash out
re-financing, tenant purchase options, or a building sale. Our target Return on Cost is 9%.
We hope you find the following detailed information about this opportunity as enticing as we do, and look forward to hearing of your potential participation.
Sincerely,
West Loop Partners
ARCH FIN
LAW
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
NEIGHBORHOOD HISTORY
Sources:
http://www.encyclopedia.chicagohistory.org/pages/878.html
Current
History
Today, West Loop is a place that Chicagoans want to visit and live in. It has
popular residential space and is convenient to live in, due to the proximity
to the Loop and expressway. Randolph
and Fulton streets are destinations for
world-famous restaurants and draw
visitors from the all over the city and
even the world. Renowned galleries,
dance companies, designers, boutiques and music venue have made
West Loop a hub for fashion and arts.
Lake Street
Randolph Street
1880's - Light Industry
Randolph Restuarant Row
Ashland Avenue
During the Civil War, the Near West Side included some of
the most fashionable houses in Chicago. However, in the
1880's, lots of single-family dwellings were demolished for
warehouses and light manufacturing plants. More commercial development happened in the area after the construction of two elevated railroads along Lake and Congress
streets, which linked this area to downtown Chicago. By the
turn of the century, Near West Side became one of the most
densely populated district in Chicago. By 1950's, the neighborhood was still divided by race and religion. In 1961, the
announcement of constructing University of Illinois' new
Chicago campus in this area led to the residential and commercial boom. In the 1980's, light industrial buildings have
begun to be converted into loft apartments.
Near West Side
West Loop
Chicago Loop
Congress Street
UIUC
Figure 1. History
Legend
Near West Side
1961 - UIUC
1980's - LOFT
ARCH FIN
LAW
Target Property - 1133 Randolph Street
West Loop
University of Illinois-Chicago Campus
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
DEMOGRAPHIC
Sources:
Simple Map; http://crime.chicagotribune.com/chicago/community/near-west-side;
http://www.city-data.com/neighborhood/Near-West-Side-Chicago-IL.html
Near West Side has a higher population density than Chicago as a whole. The area
has experienced extensive population growth and is still growing with a higher median
household income, higher median housing rent and a lower unemployment rate. The
neighborhood shows signs of continuing prosperity and we would like to seize the opportunity of strengthening the neighborhood and making a profitable return.
Near West Side Chicago
Compared
Population Density
11942/sf
11919/sf
With
Median Household Income
$73,404
$43,628
Chicago
Median Rent
$1,154
$789
Unemployment Rate
10.7%
11.1%
0-159
160-1276
1277-3261
3262-6482
6483-514981
Population Density
Unemployment Rate
Median Rent
Median Household Income
$0.00-$494.99
$495.00-$639.99
$640,00-&821.99
$822.00-$1108.00
$1109.00-$2250.00
$0.00-$39865.99
$39866.00-$51006.99
$51007.00-$64164.99
$64165.00-$84258.99
$84259.00-$399869.00
Figure 3. Median Household Income(2014)
ARCH FIN
LAW
Figure 2. Population Density-per sq.mile(2014)
Figure 4. Median Housing Rent(2014)
0.00%-5.58%
5.59%-8.10%
8.11%-10.89%
10.90%-15.19%
15.20%-100.00%
Figure 5. Unemployment Rate(2014)
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
NEIGHBORHOOD PLAN
Sources:
Fulton Market Innovation District Plan
Fulton Market Innovation District Plan- July 2014
A Land Use Plan for Coordinated Economic Growth
retailer
Current Situation
Goal
"A place in which tra- "Ensure the area conditional and innovative tinues to serve the need
businesses coexist in a of both exisitng and new
mixed-use area on the
companies. "
edge of downtown. "
Approach
"Preserve existing jobs
while accommodating
private sector investments that reinforce the
area's expanding role
as an innovation-driven
employment center. "
10,000
in next
two years
restaurant
Target Property
Figure 6. Fulton Market Innovation District Plan
ARCH FIN
LAW
leisure-oriented
business
food distributor
A place with a growing economy, where diverse job opportunities
exist and is planned to attract more employees!
Randolph Row Subarea
innovation-driven firm
meat packer
In "Fulton Market Innovation Distric Plan", the target property is
located in Randolph Row Subarea,
which encompass one of the most
popular destinations for restuarant-goers in Chicago - Randolph
Street, entertainment venues and
culturally aware business that
draw visitors from outside of the
neighborhood. The Plan states
that "new uses should renovate
and incorporate existing buildings."
500
manufacturing
technology-related jobs
Figure 7. Current and Future Job Opportunities
Proposed Uses
Full-service restaurants, coffee shops, taverns,
boutique hotels, entertainment venues, retail, offices, personal services, food purveyors, butcher
shops, groceries and residential (above first floor).
Proposed Building Scale
2-5 stories
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
POWER OF TEN
Restaurant Row - Some of the best restaurants in the nation are
situated on Randolph and nearby streets. People flock to this
area for some of the best eats around!
Harpo Productions - Oprah Winfrey opened this complex in 1990
to house her talk show. Although Harpo will be leaving this site
in December, some tenants will stay and Sterling Bay is in discussions about development possibilities. (Chicago Tribune)
New Google Location - Google is moving in and bringing jobs,
energy, and money with them. The space will also host some
new restaurants! Crain's Chicago, Google.
Union Park - A historic park with over 13 acres of land, Union
Park boasts a field house, gymnasium, swimming pool, etc.
Pitchfork Music Festival is held here annually as well as after
school programs and other events throughout the year.
Randolph Street Market - Indoor/Outdoor market that hosts antique and art vendors in the Summer, Fall, and Spring months.
As shown in the map
above, the property is
situated between the
pink and green lines
of the El and a bus
route (highlighted by
the dashed blue line).
Additionally, there is a
major highway to the
east and another to the
south, making a road
trip out of town very
easy!
"With numerous galleries, boutiques, and
restaurants catering to
both small and large
businesses, the area
is well positioned for
a sharp incline in both
daily foot traffic and
rents..."
-Felix Gutnikov Executive VP of Origination at
Thorofare
RealEstateFinanceInvestment.
com March 2, 2015
Divvy bikes are incredibly popular in the city
and there is a Divvy
station on the side of the
property!
"Divvy is Chicago's bike
sharing system with
3,000 bikes and 300 stations across the city. Intended to provide Chicagoans with an additional
transportation option for
getting around the city,
Divvy is fun, easy, and
affordable."
United Center - Home to the Chicago Bulls and Chicago Blackhawks! Although this venue is about a mile away, it is always
buzzing with sporting events and concerts.
Haymarket Pub & Brewery - This microbrewery offers craft beer,
tours, food, and unique events. The company is planning to open
a full scale brewery in Michigan which will likely increase consumer recognition and food traffic.
Lyon & Healy Hall - Lyon & Healy is a famous harpmaker with its
factory located in the West Loop. The factory also houses an intimate concert hall designed by Marco Tanga, an Italian architect.
Skinner Park - This park has over 7 acres of land and is the venue of sporting events, afterschool programs, summer day camp,
and family fun nights.
Blommer Chocolate Company – Walking down the streets in the
Fulton River/West Loop, people can often smell chocolate in
the air. This lovely addition to the neighborhood is due to the
Blommer Chocolate Factory! Stop in for a tour and some yummy
treats!
.13 Mi .25 Mi .5 Mi 1 Mi www.divvybikes.com/
about
ARCH FIN
LAW
Retail
PLAN
INTRO
NEIGHBORHOOD
Restaurants
SITE
Activities
Coffee and Bars
Figure 8. Power of Ten
DESIGN
Schools
FINANCE
Medical District
CONCLUSION
WEST LOOP PARTNERS
RECENT DEVELOPMENT
Restaurant Row
Randolph St has been a foodie
spot since the '90s, but has undergone a recent resurgence in
popularity with new restaurants
and star chefs moving in, creating
a "hip-but-populist image" and
serving up some fantastic eats!
Above: Sign for Little Goat, owned
by the owner of Girl and the Goat
which is on Randolph as well.
Below: Nellcote, which describes
itself as "Opulent yet approachable."
ARCH FIN
LAW
Sources: Chicagomag.com, nellcoterestaurant.com, dnainfo.com
Google
Google is moving its Chicago office
from River North to Fulton River District. 500+ people working
in engineering, design, sales, finance, operations, etc. will come
to the area in early 2016.
The expectation is that Google will
bring more young talented people
to this area, who will help support
the economic well-being of the
Fulton River District/West Loop
neighborhood.
Transit Oriented Development
The above pictured Morgan-Lake El
Station opened in 2012 and has had
a tremendous effect on the area.
The station "is a strong and recent
example of how increasing access
to modern, affordable public transportation creates local economic
growth," Hosinski said. "...it has
been a key factor, among others, in
attracting new residential developments and businesses to the West
Loop neighborhood." Catherine
Hosinski is a CTA spokeswoman.
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
PROPERTY INFORMATION
WEST LOOP PARTNERS
Site
Zoning
¥¥ DX-3: Service, small scale business, or residential (3 FAR).
¥¥ Area is under historical land use plan, changes to zoning for higher FAR not likely,
but not warranted to profitably up value.
¥¥ Buildings historical character must be maintained.
Aggregation of 2 Properties
¥¥ 1133 W Randolph:
3 Story 66x50 Corner building with adjacent 1 story 66x25 building
Listed for Sale at $3.2M
¥¥ 1141 W Randolph:
3 Story 66x25 building
Assessment of Site
Partner equity valued at $750K
¥¥Perfect definition of worst building in best neighbor¥¥ Purchase lease option for city owned parking lot.
hood.
Approximate Total Buildable Square Feet :
(66x100x3) = 19,800 F.A.R. of 3
¥¥Site was operated as cold storage warehouse, solid
City Owned Parking
1141 W Randolph 1133 W Randolph
bones offer great platform for structural transformation.
¥¥Significant up value via aggregation of two properties
through reduction of vertical space loss.
¥¥Anticipate mixed use of 1st floor retail, 2nd floor tech
office, 3rd floor condo lofts
¥¥Lease option for parking lot is further up value opportunity for future development.
ARCH FIN
LAW
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
TARGET MARKET
Target Condo Owners
Target Office
Ideally, we would like an incubator or accelerator to move
into our second floor office space. With an established organization (as opposed to a start-up) we are more likely to
receive high rents and long term lease agreements. Additionally, we can more easily attract technology and food
focused entrepreneurs to the area with an established organization to do the marketing for us!
Age: 32
Job: Software engineer,
entrepreneur
Income: 250,000 +
Hobbies: Crossfit training, piano
Age: 34
Job: Popular Restauranteur, looking to open new restaurant
Income: 300,000+
Hobbies: food blogging, running
Target Retail
Coffee
ARCH FIN
LAW
Gym
Restaurant/Bar
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
STAKEHOLDERS
Advertise
Condos
Advertise
Retail and Office Space
Neighbors of West Loop
NOWL is a "neighborhood organization formed by residents to empower those in West
Loop who want to make a positive impact on the community." They advocate for responsible development and host community gatherings.
Google's New Office
Google plans to open their new office in West Loop in 2016. As we move forward with
our development, we expect to promote and advertise our loft space to google's employees and have them as our potential tenants.
We plan to advertise our first floor restaurant and coffee space by reaching out to the
NOWL, getting our projects known by the residents and receiving feedback on desired
types of restaurants or coffee shop for our project.
Get Mutual Support
from Other Developments
West Central Association
WCA is "dedicated to enhancing the well-being of its member businesses, institutions,
and organizations. WCA has advocated for business and property owners on legislation,
taxation, transportation, architectural treatment and model plans for the area."
Learn Applicable
Government Services
RFMA
RFMA has helped Near Westside businesses, property owners and residents solve individual and government-related challenges.
They offer Services such as: "Business solutions; Real estate solutions; Accessing government economic development incentives to save money; Accessing government services; Business-to-business networking".
By connecting with them, we could learn the applicable government services for our
site and manage to upvalue without adding costs.
Learn
Grants/Funding Options
"The Association's growing membership works together to encourage a healthy business environment by providing a unified voice for our members, supporting thoughtful
development, encouraging mutual support, and attracting new businesses, institutions,
and residents to the area. "
By reaching out to WCA, we may get mutual support from other developments in surrounding areas.
ARCH FIN
LAW
West Loop Community Organization
WLCO is a recognized delegate agency for the City of Chicago. They represent the business and residential communities within the West Loop boundary. WLCO promotes local businesses, supports economic development and advocates for continued growth.
By consulting them, we may learn of potential grants or funding options for our business and get possible subsidies.
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
DESIGN FOR THIS SITE
Modern/Mix Use:
By infilling a new design between our
properties to propose a mix-used block.
Historical Respect
Being respectful to the historical value,
retaining the beautiful historical elements.
Placemaking:
French window, Exciting sidewalk, extended urban coffee/restaurant space.
Highlighted Rooftop:
Making full use of the rooftop, creating
a mixture of lifestyle and increase value.
Programming
Rooftop:
Semi-covered Bar
3rd Floor:
Specious Condos
2nd Floor:
Technology Firm
1st Floor:
Restaurant, Coffee, Gym
ARCH FIN
LAW
PLAN
INTRO
NEIGHBORHOOD
Figure 9. General Design Idea
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
ARCH FIN
LAW
PLACEMAKING
Bright french window, elegant paving,
sidewalk greens and outdoor seating
for the coffee shop and restaurant.
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
GROUND FLOOR - RETAIL
Ground Floor - Retail
1750 sf
Gym
1340 sf
Coffee
Shop
2570 sf
Restaurant
Lobby
Figure 10. Ground Floor Plan
Gym
Lobby
A separate lobby accessible through the back
entrance will ensure
privacy for our condo
owners.
ARCH FIN
LAW
Staying healthy and fit is
a priority for many millenials. Therefore, we
have decided to rent out
a space on the ground
floor to a fitness center
that will be accessible
by all tenants as well
as the other people in
the area. We hope our
residents and office users will appreciate the
space and that it will
bring other consumers
to our building.
Restaurant
Coffee Shop
A nearby coffee shop is a
must for most city dwellers. A shop with a cool
vibe and friendly staff
will make our building
welcoming, attract foot
traffic, and insure our
office tenants are adequately caffeinated!
We would like to attract a
restaurant with a unique
character that can bring
a new concept to a neighborhood known for its
restaurants. Ideally, the
restaurant on the ground
floor will also rent the
rooftop bar which it can
operate year round.
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
SECOND FLOOR - OFFICE + THIRD FLOOR - RESIDENTIAL
Second Floor - Office
An open space office concept will be
perfect for a tech start-up incubator which thrives on communication
and brainstorming between entrepreneurs and advisors. Individual
work areas mixed with large group
meeting rooms and tables will reinforce the necessity of collaboration.
Although, this is our concept for the
space, our plan and space is flexible
and can meet the needs of any future
tenant.
5870 sf
Figure 11. Second Floor Plan
Third Floor - Residential
1750 sf
2100 sf
2020 sf
The three impressive condos in the
property will be perfect for people
who want lots of space in a trendy
area. We hope to pre-sell these condos so that the owners can build out
the space at their own expense and
in a style that suits them best. The
owners will have the benefit of large
windows, the buildings gym, restaurant and coffee bar, and access to the
beautiful rooftop.
Figure 13. Third Floor Plan
ARCH FIN
LAW
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
ARCH FIN
LAW
ROOF TOP
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
COMPARABLES & MARKET
The West Loop offers
many sensational and
recent
renovations
across all building types
in immediate vicinity of
our property location.
Each comparable was
renovated/built in the
last 6 months giving
solid, real time benchmarks for our development.
As with any market,
there are echelons of
quality and quantity. Vacancies and prices for
new, "wow" buildings
show clear demand by
retail operators, tech
companies, and creative class individuals.
These comparables are
those attracting top of
market rents and what
we intend 1133 Randolph to achieve.
ARCH FIN
LAW
Sources: Chicago Home Info, Colliers, Crains, REIS, Loopnet, Zillow
New Listings:
Top Floor:
Condo Residential
Address
Distance
Price # of Sq Foot
Amenities/comments
Sold Listings:
1152 W Fulton
.2 Miles North
$825K 2,000
No amenities. Roof deck,
no city views
1000 W Washington
.2 Miles South East
$795K 2,350
Full line of amenities
100 S Sangamon
.5 Miles South East
$925K 1,946
Adjacent to park, rooftop
city views
1144 W Randolph
.1 Miles North
$30
NNN
1035 W Lake St
.2 Miles North East
$27
Partial Floor, not recently renovated
1313 W Randolph
.2 Miles West
$25
Further out in West
Loop, transit stop
Ground Floor:
Retail
Address
Distance
Price/Sq Foot
Lease Terms/
comments
1152 W Randolph
.1 Miles North
$32
$400K Construction Payback, NNN
1134 W Washington
.2 Miles South
$25
NNN, offering TI abatements
118 N Peoria
.3 Miles East
$38
NNN
from 125
from 39
from$340K
98.6% of Listing
5 Year
Avg. Vacancy:
2nd Floor:
Office
Address
Distance
Price/Sq Foot
Lease Terms/
comments
Median
Sales Price:
25%
67%
8.6%
5 Year Inventory Growth:
14%
19%
-.1%
.0%
West Loop
Chicago
West Loop
Chicago
Current
Vancancy YOY
3.0%
Net Absorption
YOY
19,536
Down
from 4.4%
Clear signs of
unmet demand for new development!
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
FINANCING PROCESS
$5.95M Total Cost
To finance our total development costs of $5.95M, we use an evolutionary approach to reduce
our risk as we execute our sales and lease up strategy
ARCH FIN
LAW
Cash
Equity
Investor
Initial Equity
$2.56M Cash Equity is earmarked
for the 1133 W Randolph Building.
$2.56M
1141
Building
Owner
Also, cash consideration will
demonstrate seriousness to the
seller and quicken our efforts to
obtain tenants and residents.
$750K
Sweat
Equity
$375K
Prelease
Deposit
Sweat Equity will be
initial Developer and
Hard Construction
Costs ($187.5K Each)
Sources
Cash Equity Partner
1141 Owner Building
Developer Sweat Equity
Construction Sweat Equity
Pre Lease
Condo Deposits
Construction Loan
Pre Lease/Sales
Our Target Ground & Office Tenants
are investor backed new ventures.
Thus it is an ideal match to utilize
upfront pre leases. These leases
will be discounted with a 4% Present Value Reducing their cash outlays and in turn reducing our risk
and borrowing needs. 50% of the
leases will be pre-paid and credited as tenant improvements. We
target a 20% deposit for our 3rd
floor condos.
$609K
Presale
Deposit
Uses
$ 2,560,000.00 1141 Building
$ 750,000.00 1133 Building
$ 187,500.00 Construction
$ 187,500.00
$ 609,132.48
$ 445,000.00
$ 1,210,774.60
$ 5,949,907.08
$ 750,000.00
$ 2,560,000.00
$ 2,639,907.08
Choice of Debt
To fund our construction & initial
years of operation, we will pursue
a modest 5% interest only "mini
perm" loan, with availability of additional $600K for contingencies.
$445K
Mini
Perm
$1.2M
$ 5,949,907.08
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
CONSTRUCTION COSTS
WEST LOOP PARTNERS
Construction Budget
Construction Costs
Hard Costs
▪ Exterior
Rooftop Furniture
Windows ( 2nd and 3rd Story)
Glass Window Fill In
▪ 3rd Floor Condo Lofts ( 6300 Sq Ft)
▪ 2nd Floor Office ( 6200 Sq Ft)
▪ Ground Floor & Rooftop
Ground Floor Restaurant
Ground Floor Retail
Rooftop Bar
Windows
Total
Per/SF
-­‐
-­‐
-­‐
-­‐
$ 10,000.00
$ 14,756.00
$ 325,000.00
Subtotal $ 349,756.00
$ 422,169.30
$ 520,380.00
$ 67.01
$ 82.60
$ 538,076.00 $ 134.52
$ 130,900.00 $ 65.45
$ 130,900.00 $ 65.45
$ 7,378.00 $ -­‐
Subtotal $ 807,254.00 $ 100.91
▪ Freezer Removals/Wall Demolition*
$ 187,500.00 $ 13.10
Total Hard Costs $ 2,287,059.30 $ 111.02
Soft Costs
▪ Contractor ( 3% of Hard Costs)
$ 68,611.78
▪ Permits
$ 15,736.00
▪ City Fees
$ 15,000.00
▪ Architecture/ Engineering*
$ 75,000.00
▪ Legal*
$ 25,000.00
▪ Developer Fee*
$ 87,500.00
▪ Interest Carry ( 6% Estimated on $1.1M Loan) $ 66,000.00
Total Soft Costs $ 352,847.78 $ -­‐
TOTAL CONSTRUCTION COSTS
$ 2,639,907.08 $ 128.15
Square Footages(Approximated)
Rooftop Bar
2,000
Condo
6,300
Office
6,300
Restaurant
4,000
Retail
2,000
Total 20,600
Soft costs are of a lower
percentage as building rehabilitation did not require
robust pre-construction expenses such as soil boring,
zoning, surveying etc.
ARCH FIN
LAW
PSF Hard Costs
Based on
70% of
RS Means New Construction
So. Costs 13% Hard Costs 87% PLAN
INTRO
*Notes
Sweat
Equity
Contingency
Fund will be
additional untapped draw
from mini perm loan
($600k)
Task
Purchase Phase
Offer/Acceptance
Title Work & Closing
Freezer Removal
Marketing and Lease Up
Construction Loan Approvals
Condo Presale Closing
Tenant Pre Lease Closing
Retail/Restaurant
HVAC
Electrical
Plumbing
Flooring/Walls
Windows (1st Story)
Office
HVAC
Electrical
Plumbing
Flooring/Walls
Loft
HVAC
Electrical
Plumbing
Flooring/Walls
Exterior
Windows (2nd and 3rd Story)
Glass Window Fill In
NEIGHBORHOOD
1
Our Development Team views Construction and Sales/Leasing as the fullest "Buckets of Risk".
Compounding these sources of risk is their interrelatedness
lack of tenants/
buyers will increase carrying cost of real estate as well as increase importance of
construction execution.
To mitigate (not eliminate) these risks we:
Utilize Sweat Equity for initial hard/soft costs
3 Month window to pursue tenants and buyers and arrange closing of deposits
Staggered Construction to strengthen momentum to drive building completion
2
3
Months (# of Weeks for Task are within bars)
5
6
7
8
4
Our OurConstruc+on Constructionschedule scheduleis staggard for sfor
ix m
is staggard
sixonths months
con+nuous w
ork f
or ach continous work for eeach
trade. e view trade. WWe
viewthis thisas as
beneficial beneficialto toestablishing establishing
pos+ve ith postiverela+onships relationshipswwith
our ourconstruc+on constructionpartners. partners.
2
2
4
12
9
2
4
4
10
11
12
Total Work Times (Weeks)
HVAC
Electrical
Plumbing
Windows
Flooring/Walls
8
8
8
8
Lease up is
"Critical Path"
We give 3 months
to find our tenant
partners. If not,
development can
be reconsidered with no
accumulated debt.
4
8
8
8
8
8
8
8
8
8
12
SITE
DESIGN
FINANCE
CONCLUSION
24
24
24
24
20
WEST LOOP PARTNERS
PRO FORMA AND FINANCIAL RETURNS
Rental Properties Pro Forma
Operating Revenues
1st Floor Restaurant/Retail
2nd Floor Office
Rooftop Bar
Gross Potential Rent
Vacancy (@ 0%)
Tenant Improvements (@ 50%)
Gross Rental Income
Operating Expenses
Property Taxes (3% of Capitalized V alue)
Property Management Fees (2.25% of GPR)
Insurance (1.5% of GPR)
Total Operating Expenses
NOI Income
NOI Margin
Capitalized V alue (@ 6.0% Cap) Debt Service
Before Tax Cash Flow
Debt Coverage Ratio
Taxes
Depreciation
Principal Add back (None: Interest Only Loan)
Interest Taxable Income
Taxes @39.5%
After Tax Cash Flow
1
3
4
$
$ 210,000.00
$ 189,000.00
$ 40,000.00
$ 439,000.00
$ -­‐
$ (219,500.00)
$ 219,500.00
$/NRSF
$ 35.00
$ 30.00
$ 20.00
$ 30.70
$ -­‐
$ (15.35)
$ 15.35
$
$ 210,000.00
$ 189,000.00
$ 40,000.00
$ 439,000.00
$ -­‐
$ (219,500.00)
$ 219,500.00
$/NRSF
$ 35.00
$ 30.00
$ 20.00
$ 30.70
$ -­‐
$ (15.35)
$ 15.35
$
$ 210,000.00
$ 189,000.00
$ 40,000.00
$ 439,000.00
$ -­‐
$ (219,500.00)
$ 219,500.00
$/NRSF
$ 35.00
$ 30.00
$ 20.00
$ 30.70
$ -­‐
$ (15.35)
$ 15.35
$
$ 210,000.00
$ 189,000.00
$ 40,000.00
$ 439,000.00
$ -­‐ $ -­‐ $ 439,000.00
$/NRSF
$ 35.00
$ 30.00
$ 20.00
$ 30.70
$ -­‐
$ -­‐
$ 30.70
$ 70,915.38
$ 9,877.50
$ 6,585.00
$ 87,377.88
$ 132,122.12
60.2%
$ 2,202,035.26
$ 60,000.00
$ 72,122.12
0.83
$ 4.96
$ 0.69
$ 0.46
$ 6.11
$ 9.24
60.2%
$ 153.99
$ 70,915.38
$ 9,877.50
$ 6,585.00
$ 87,377.88
$ 132,122.12
60.2%
$ 2,202,035.26
$ 60,000.00
$ 72,122.12
0.83
$ 4.96
$ 0.69
$ 0.46
$ 6.11
$ 9.24
60.2%
$ 153.99
$ 70,915.38
$ 9,877.50
$ 6,585.00
$ 87,377.88
$ 132,122.12
60.2%
$ 2,202,035.26
$ 60,000.00
$ 72,122.12
0.83
$ 4.96
$ 0.69
$ 0.46
$ 6.11
$ 9.24
60.2%
$ 153.99
$ 141,830.77
$ 9,877.50
$ 6,585.00
$ 158,293.27
$ 280,706.73
63.9%
$ 4,678,445.51
$ 9.92
$ 0.69
$ 0.46
$ 11.07
$ 19.63
63.9%
$ 327.16
$ 163,843.77
$ -­‐
$ 60,000.00
$ (91,721.66)
$ -­‐
$ 72,122.12
$ 163,843.77
$ -­‐
$ 60,000.00
$ (91,721.66)
$ -­‐
$ 72,122.12
$ 163,843.77
$ -­‐
$ 60,000.00
$ (91,721.66)
$ -­‐
$ 72,122.12
Returns: 15% IRR/ 9% Return on Cost
Condo Sales Pro Forma
Proceeds from Sale
Condo Unit 1 Condo Unit 2
Condo Unit 2
ARCH FIN
2
After Tax Cash Flow From Sale
Less:
Debt $ 1,200,000.00
Depreciation Capture
$ 122,882.83
Taxes (@ 20%)
$ 695,689.10
$ 2,659,873.58
Chicago Cap Rate of 6%
Total Proceeds
1
$ 850,000.00
$ 750,000.00
$ 625,000.00
$ 2,225,000.00
Expenses
Building Costs (1/3 of Purchase Price)
Construction Costs
Expenses
Gross Margin
Taxes on Sale (@ 39.6% Income Rate)
After Tax Cash Flows from Condo Sales
Pro Forma Comments:
¥¥ Jump in Y4 NOI due to phase out of TI incentives , similar increase in property taxes
¥¥ Leases are NNN, therefore no repair/ maintenance expenditures
¥¥ Tax losses are of significant value to a wealthy investment partner: $164K of tax shield
¥¥ Building sale is not optimum exit, Cash Out Refi at 75% LTV would generate $2.3M payment which could be utilized in exercising of parking lot option and expansion of development.
$ 1,250,000.00
$ 422,169.30
$ 1,672,169.30
$ 552,830.70
$ 218,368.13
$ 2,006,631.87
Scenario With 80% LTV Leverage:
While the above scenario fits the risk and return profile of our team and prospective investor, we realize such a
conservative approach would not be taken by a seasoned developer who could aggressively leverage the project.
Eliminating Tenant Improvements as well as funding the building purchase and construction costs at 80% LTV,
would increase the IRR to 25%. Accordingly, our project is very marketable and attractive to an experienced development team.
LAW
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
CONCLUSION
WEST LOOP PARTNERS
Feasibility Chart Review
As a "check" for our development, we reviewed each
"bucket of risk" that we would encounter upon execution. We do not deem any as insurmountable given
the preceding design and financial plans.
Historical
building with
character +
modern
design
No cleanups
or industrial
legacies
Partner mentality, building
together to
share risk &
reward
Prudent
leverage,
protecting
downside with
great returns
Protects area
design and
promotes
local business
Legal
Taxes
Economic
Cycle
Environmental
LAW
Social/
Construction Community
Goals
Staggered
scheduling,
"partner
mentality"
West Loop is
the definition
of Path of
Growth
Enough
"runway" for
stabilized
execution
ARCH FIN
Market
Research
WOW
Architecture
"Win-Win
mentality"
influences our
risk sharing
contracts
Political
Approvals
No rezoning required,
increases tax
base
Sales
/Leasing
Personal
& Family
Property
/Management
Equity
& Debt
Property generates $164K
in tax savings
for investor
¥¥ 9%
NNN tenants,
condo
association
management
Feasible
project, great
1st step for
future deals
Benchmarks & Takeaways
Return on Cost
Beats 5% Chicago Cap Rate,
downside protection.
¥¥ Executable: entry level development that is fantastic first step for generating track record for future deals
PLAN
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
RESUME - FAN FAN (MUP) Neighborhood&Site Analysis; Layout & Graphic Design
FAN FAN
EDUCATION
09/2013 - 05/2015
09/2008 - 07/2013
EXPERIENCE
03/2015 - 03/2015
2200 Fuller Court, Apt 408B
Ann Arbor, MI 48105
E: [email protected]
T: +1 (734)834-7462
University of Michigan, Taubman College of Architecture and Urban Planning, Ann Arbor, MI
Candidate for Master of Urban Planning
Candidate for Graduate Certificate in Real Estate Development
Northwest University, Department of City and Environment, Xi’an, China
Bachelor of Engineering in Urban Planning
Skidmore, Owings & Merrill LLP: SOM, New York, NY
Spring Externship
¥¥ Produced presentation layout for an interior design project.
¥¥ Participated in planning charrette and project meetings.
05/2014 - 08/2014
Joseph Wong Design Association, Shenzhen, China
Summer Intern
¥¥ Received significant exposure to projects’ meetings with clients, worked closely with multidisciplinary people from diverse cultural backgrounds and acted as an interpreter to facilitate international communications.
¥¥ Participated in the Master Plan/Section drawing of Hainan Yalong Bay Project; produced Revit
Model to check the sea-view visibility of villas, which helped the developers to meet market’s
needs and increase project’s market value.
¥¥ Took main responsibility in the Phase I of Dapeng Health Town Concept Plan; worked with
clients about defining target market, creating plan vision, designing plan structure and transportation system; prepared Phase I presentation to the government by creating planning diagrams
and applying GIS to conduct land evaluation, topography analysis and landscape visibility
analysis.
07/2012 - 08/2012
Design and Research Association of Urban Planning, Xi’an, China
Summer Intern
¥¥ Analyzed the inventory of Public Facilities in Xi’an High-tech Industries Development Zone
(XHDZ) statistically and graphically; studied international cases on public facilities supply and
spatial distribution in order to provide suggestions for Public Facilities Plan in XHDZ.
¥¥ Performed map drawings and zoning code calculations for diverse detailed plans.
¥¥ Assisted the supervisor in presentation preparation and documents management.
12/2011 - 01/2012
Northwest Architectural Design institute, Xi’an, China
Winter Intern
¥¥ Calculated the energy-saving statistics for public buildings.
¥¥ Researched the advantages of Dihua Town to develop as a tourism-oriented area; assisted in
landscape design, taking main responsibility in street furnitures/bridges design; participated in
master plan drawing; produced final layout.
AWARDS AND DISTINCTIONS
12/2014
Rackham International Student Fellowship (merit-based)
Graduation with Distinction Honors
06/2013
Department Excellent Works in Urban Planning
02/2012
05/2011
NECCS Third-place Prize
First-place Scholarship (merit-based)/ Excellent Student
02/2011
Outstanding Performance in National Competition of Urban Planning and Social Survey
09/2010
ARCH FIN
LAW
SKILLS
Software
PLAN
Languages
INTRO
Proficiency in ARCGIS, Autodesk AutoCAD, Adobe Creative Suite, SketchUp and Microsoft Office
Suite; Elementary proficiency in Rhino and Revit
Native speaker of Chinese; Professional working proficiency in English
Other: Statistical Analysis and Real Estate Pro Forma Making
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
RESUME - JORDAN FEENSTRA (MBA)
Financial Analysis; Market and Property Information Analysis
JORDAN FEENSTRA
5374 36th Avenue, Unit 39, • Hudsonville, MI 49426
[email protected]
EDUCATION
UNIVERSITY OF MICHIGAN
Stephen M. Ross School of Business
Master of Business Administration, May 2015
• Currently a candidate for graduation with Distinction Honors
• Elective emphases: Analytics, Finance, Strategy
• Club Memberships: Finance and General Management
GRAND VALLEY STATE UNIVERSITY
Bachelor of Arts In History, April 2004
• G.P.A.: 3.4, Dean’s List 2002 and 2004
EXPERIENCE
2007‑Present
Ann Arbor, MI
Grand Rapids, MI
COMERICA BANK
Grand Rapids, MI
Investment Analyst, 2012‑Present
• Execute ROI improvement strategies for individuals and organizations aiding in $125
million (18%) increase in aggregate market value over three year period.
• Construct financial models for Comerica’s Wealth Management equity fund aiding in
4% annual market outperformance over three year period.
• Innovated Excel database to isolate account abnormalities and cross sell opportunities
leading to identification of $3.5 million in new investable assets over prior year.
Investment Associate, 2010‑2012
• Reengineered business processes by pioneering utilization of centrally operated service
center decreasing account loads by 28% as well as reducing costs by estimated $1
million over five year period.
• Designed investment proposal and collaborated cross functionally with other divisions
to sell comprehensive customer solution for an industrial customer, totaling $450,000 in
aggregate interest & fee revenue.
• Led project as a subject matter expert to increase compliance with new federal
regulations. Culminated in 100% completion rating as well as 100% compliance rating
by internal company and Federal Reserve auditors past three years for entire team.
Investment Assistant, 2007‑2010
• Created new platform connecting divisions in order to manage externally held client
assets. Led to $6 million in new assets under management for department and
obtainment of sales goals.
• Took initiative to successfully drive adoption of new trading software program
replacing manual data entry process to leverage time of investment managers resulting
in throughput increase of 12.5%.
• Developed custom sales presentation and pitch book for large community nonprofit
organization highlighting firm capabilities and value added differentiators leading to
$9.7 million in new assets under management.
ARCH FIN
LAW
2005‑2007
NATIONAL PARK SERVICE
Hyde Park,NY & Springfield,IL
Park Ranger
• Conducted interpretative/educational presentations to diverse audiences lasting
approximately one hour at Roosevelt‑Vanderbilt Historic Sites (NY) & Home of
Abraham Lincoln Historic Site (IL).
• Orchestrated marketing efforts and community engagement events.
• Assisted authors and historians in their publications.
ADDITIONAL
• Created and led mentorship program for at risk children through Kids Hope USA
partnership between local church and elementary school
• Participated in home ownership construction projects for low income persons in Neon,
Kentucky, Grand Rapids, Michigan, Palmer, Alaska and Ensenada, Mexico.
• Avid reader, books read over last 12 months: A Short History of Nearly Everything by
Bill Bryson, Thinking Fast/Slow by Daniel Kahneman, To Sell is Human by Daniel Pink
PLAN
November 2014
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
RESUME - KELSEY D. SHULAN (JD)
Neighborhood&Site Analysis; Project Management; Writing
KELSEY D. SHULAN
300 N. Canal St.· Chicago, IL 60606
[email protected] · 734.368.4502
EDUCATION
UNIVERSITY OF MICHIGAN LAW SCHOOL
Ann Arbor, MI
Juris Doctor, Expected May 2015
• Dean’s Scholarship (merit-based)
• Extern at Federal Trade Commission Midwest Regional Office
• Entrepreneurship Clinic Student Attorney
• Hiring Committee for Assistant Dean of the Office of Career Planning
• Research Assistant to Professor David Hess, Associate Professor of Business Law and Ethics, Ross School of Business
• Women Law Students Association - Treasurer
• Frank Murphy 1L Oral Advocacy Competition Quarter Finalist
UNIVERSITY OF MICHIGAN STEPHEN M. ROSS SCHOOL OF BUSINESS
Bachelor of Business Administration with High Distinction, April 2012
• Focus in Operations and Strategy
• Minor in Women’s Studies - Gender, Race, and Ethnicity
• Carson Scholar (selected for intensive business and policy program in Washington DC)
• Business Today International Conference 2010 Case Study Winner
Ann Arbor, MI
EXPERIENCE
POLSINELLI PC
Summer 2014, Chicago, IL
Summer Associate (Offer Received and Accepted)
• Drafted and edited corporate documents including those necessary for incorporation, joint ventures, and financing.
• Collaborated with real estate attorneys to draft and organize complex asset sale and purchase agreements.
• Conducted detailed research and reported on effect of new regulations on producers of medical waste. The report will be
used to educate clients and prevent future noncompliance.
• Developed argument for and wrote motion to dismiss bad check case brought against client. Litigation associate used this
argument in court proceedings.
DICKINSON WRIGHT PLLC
Summer 2013, Ann Arbor, MI
Summer Associate (Offer Received)
• Drafted a variety of corporate documents including loan documents, bylaws, and agreements.
• Produced Articles of Incorporation and Bylaws for a 501(c)(3) organization.
• Researched and drafted legal memos on a variety of topics including evidentiary rules and mortgage deficiency statutes in
multiple states.
• Constructed persuasive argument for the approval of a request for amendment to a trademark registration. The argument
was successful and the United States Patent and Trademark Office accepted the amendment.
GOLDMAN SACHS ASSET MANAGEMENT
Summer 2011, New York City, NY/Jersey City, NJ
Summer Operations Analyst
• Reconciled accounts, created client reports, and communicated with trading desk and external custodians and fulfilled
other various duties of a Portfolio Administrator.
• Researched and drafted detailed written instructions for facilitating manual accounting transactions and created database
to record transactions thereby increasing procedural controls, decreasing risk of error and documenting procedure for
regulatory inspectors. Presented project to managers and team.
ARCH FIN
LAW
PLAN
ALPS CONSULTING-ROSS SCHOOL OF BUSINESS
Summer 2010, Ann Arbor, MI
Consulting Intern
• Consulted with laser technology company on market entry strategy for new product.
• Researched and analyzed market trends for new products to corporate clients; created informational binders and sales
charts; presented findings to corporate clients and management team.
• Participated in series of seminars taught by professors of Center for Positive Organizational Scholarship, focusing on
corporate relations and marketing theory.
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION
WEST LOOP PARTNERS
RESUME - XUTAO WANG (M.ARCH)
Architecture Design; Graphic Design
Xutao Wang
Stone R d 2429 Northwood V | Ann Arbor, MI 48105 | [email protected] | (734) 834- 7358
E DUCATION
Univer s ity of Michigan -- Taubman College of Architecture and Urban Planning
Mas ter of Architecture (expected May 2015)
Ann Arbor, MI, USA
Sep. 2013- Present
S outheas t Univer s ity ---School of Architecture
B achelor of Architecture
Nanjing, J iangs u, China
Sep. 2008 --- J un. 2013
E XTE R N S HIP E XP E R IE NCE
WXY Ar chitectur e + Ur ban Des ign
•
•
New York City, USA
Mar.2. 2015 - Mar.6. 2015
As s is ted 4 project teams with drawings , graphic des ign and model making.
E ngaged in the Plaxall project with clients and NYC planning authority.
R TK L As s ociates Inc.
•
•
Chicago, USA
Mar.3. 2014 - Mar.7. 2014
Highly involved in the conceptual des ign of the Window of China commercial project
As s is ted the project expres s ion at the kick off meetings with worldwide clients
IN TE R NS HIP E XP E R IE N CE
UD Ar chitectur al Des ign Ins titute
•
•
•
Shanghai, China
Feb. 2013 - J un. 2013
L ed the researches and ass is ted in development s trategies for the build- out of a high- quality community
Offered regeneration concept for No.8 Hengs han R d international competition
Developed facades and plans drawings for No.8 Hengs han R d project
Ar chitectur e Des ign & R es ear ch Ins titute of S outheas t Univer s ity
•
•
•
Nanjing, China
J un. 2012 - Sep. 2012
Conducted a bioclimatic heating/cooling/lighting researches on high- rise building
E nhanced engineering & technical knowledge in building cons truction
Comprehended cons truction proces ses in practical projects
E X- CUR R ICUL AR E XP E R IE N CE
Concept planning of ar chaeological par k of the Yangs han r aw s teles s ite
•
•
Adminis tered a s ucces s ional lands cape planning and a reclamation s trategy on his torical mining s ite
Des igned a mus eum and whole area infras tructures as artificial lands cape
P r es er vation planning of his tor ical buildings
•
•
K unming, China
Feb. 2012 - J un. 2012
Surveyed and mapped 62 local houses with 3D scanner
Composed a guideline for his torical buildings and a preservation manual in historical area
K unming, China
S ite planning of his tor ical ar ea of Chenggong
•
•
ARCH FIN
LAW
Nanjing, China
Sep. 2012 - Dec. 2012
Sep. 2011 - Dec. 2011
Surveyed and drew 13 his torical buildings with 3D s canner
Formulated the infras tructure plan and a commercial land inventory for bus iness development
S K IL L S
PLAN
Proficient in Autodesk (CAD, E cotect), Adobe Suite (Illus trate, Photos hop, Indes ign), R hino and Sketchup.
INTRO
NEIGHBORHOOD
SITE
DESIGN
FINANCE
CONCLUSION