the hotel Melrose
A historically inspired boutique hotel.
Prior Quarterly Return | Target Return |
|---|---|
Fri., June 20 | The Academy, L.A |
Thu., June 19 | Bamboo, Santa Barbara |
Sat., June 28 | Cheers, Santa Cruz |
Wed., July 6 | The Roxy, San Francisco |
Grand Junction, Colorado
Hotel Melrose boasts 16 meticulously designed suites, each blending contemporary flair with traditional charm. Featuring kitchenettes, coffee stations, and high-end finishes, these suites offer a haven of comfort and sophistication for guests seeking a retreat from the ordinary. Whether for a romantic getaway, group event, or corporate function, The Hotel Melrose provides an intimate setting for unforgettable experiences.
Investment Offering
$3,000,000
Term
10 Months
Loan-to-Value
50%
Annual Return
9-10%
Estimated Value at Sale
$8,000,000+
100% Funded
Investment Summary
Fort Lending provided the bridge loan as a way to stabilize the asset. The collateral for the loan is tied to a single asset investment generating current income from hotel operations and bar tenant rent and profit share. The property has been fully operational since November 2023. Fort Lending provided total distributions of $2.5m during construction through 2023. Additional draws are anticipated for July 2024 of $416k.
The borrower originally purchased the property for $720k in 2021. Over the 3 yrs of ownership, a total of $3.5m has been spent on construction. An appraisal was completed in 2023, with a valuation of $5.9m.
A total loan-to-value is a conservative 50% with an impressive loan-to-ARV of 36%.
Loan Details
Loan Amount
$4,385,873
Monthly Debt Service
$36,549
AVG Monthly NOI
$29,083
Debt Service Coverage Ratio(DSCR)
0.80
Debt Yield
7.9%
Use of Proceeds
Financing Costs
$43,858
Reserves
$347,375
Remaining Construction
$3,019,800
Construction Loan Payoff
$974,840
Total
$4,385,873
Valuation
Stabilized Value @ 6% Cap Rate
$5,817,952
$223,767
Comparable Sales Approach
$6,662,000
$256,230
Valuation Method
Value
Per Unit
Blended Sale/Rent Approach
$6,239,961
$239,998
Address
651 US-50, Grand Junction, CO
Units
26
Year Built
2024
Lot Size
1.91 acres
Land Cost
$659,443
Construction
(to-date)
$974,839
Year Built
2024
Lot Size
1.91 acres
Type
Workforce Housing
About the Property
Risk Analysis
Strength
The Homes at Monument View are "attainable housing" options to the workforce that are commute to Grand Junction daily. With this prime location & low price point, we will stand out in the market and assist in the gap of available homes for sale.
Opportunity
Housing inventory is at one of the lowest points. The Homes at Mountain View provide an additional 26 homes to market - all at a price point over $100k below the median home price. We feel we have an opportunity to fill the current demand, with a majority of the homes selling prior to completion.
Weakness
With the banking environment a bit rocky over the past couple of years, we may have to rely on renting these units. If so, the returns are a bit lower than if all homes are sold. This is unlikely but may pose as a risk to maximizing our returns at sale.
Threats
Our biggest threat is a slowdown in real estate sales. Although rates are coming down, there is a tightening of credit requirements across the board for all forms of debt. We may have issues finding buyers that qualify for traditional financing and will result in renting these units out.
Years of Experience
16
Notes through
Fort Lending
12
Active Notes
1
Active Balance
$2,580,000
Past Maturity
Balance
$0
Current Liquidity
$1,020,689
This borrower has completed 11+ full service projects using Fort Lending's private credit product with no late payments and all loans paid back in-full & on-time.
Check out some previous projects below:
O'Rourke
SFR Fix and Flips
Apart from projects using Fort Lending, they currently own and operate 50+ units spread across 2 major areas: Butte, MT & Grand Junction, CO.
About the Borrower
FHC Value Add Debt Fund I, LLC - (VDF)
The Value-add Debt Fund (VDF) is the perfect opportunity for investors looking for consistent cash and reduced risk with a secured position. When investing in the Value-add Debt Fund, you can expect to receive a consistent interest payment at an annual rate of 9-10%, which is paid out monthly. This is similar to the interest you would receive from a bank, and your investment is secured by a mortgage on the underlying property.
Annual Return
9-10%
Minimum Investment
$50k
Term
6-24 Months
Empower
Growth
