Avalon Homes

Location,City : Canada / Brampton

Max Target : $ 4500000

Equity on offer : 30 %

Min Target : $ 2700000

Equity on offer : 19 %

Industry :
Property

Investment Round :
Seed

Stage :
Development

Website : Visit

Summary

I am looking to raise capital for a subdivision project I am working on in Sudbury, Ontario. The project is 160-200 semi's overlooking water or with green space, in a central location within the city's core.

Our estimates have the project netting a 16-20 million dollar profit (estimating roughly $100,000 per unit).

We have already met with the city and are working through the final details to prepare for a submission of a draft plan, and subsequent re-zoning application.

I am looking for any of the following:

a) A 4.5 million dollar loan with a balloon payment at the end (contract would give us 4 years with a small extension if needed).
b) A 4.5 million dollar amount for a percentage of the project. As an investor return based solely on profits of project (This would be the highest Return)
c) A 4.5 million dollar amount with a hybrid model where principle amount is built in and a smaller percentage of profits.
d) A smaller amount greater than 2.75 million with either of the terms listed above

There is already a team in place: real estate firm as primary salespeople, platinum brokerages who would be willing to market these in the GTA as investments, a builder, an engineering firm, and a construction/development firm. We have a couple of bank contacts as well who would be happy to explore a construction mortgage once we get to that point.

We have a great vision for this project and I hope its something that you can help us with.

Thanks,
Carlo

Pitch Video

The Business

Avalon plans to market itself through a variety of methods. Our plan will use referral systems, radio and published ads, leveraging of our pre-existing contacts with the local real estate companies, VIP, Platinum and Executive Real Estate agents, and industry contacts.

Avalon has been able to gain a very advantageous builder contract that will allow Avalon Homes to obtain many of the services and materials necessary to build a subdivision at a significant discount. This will allow the company to underbid its rivals and achieve a low cost leadership role.

Competitive Edge
In the construction industry the primary ways to compete are through low cost or better project management. One of the most important processes for winning a contract is the bid process. Avalon Homes has some very strong connections which will allow the securing of contracts at reduced prices. Gordon Peterson, the lead Real Estate contact and a member of the Project Leadership Team has direct personal connections with the two construction companies. Carlo DiCarlo has a direct personal connection with the builder Lakewood Homes which has secured a discounted rate for the building and some of the development costs. Through these relationships, Avalon Homes has been able to gain very advantageous discounts on services related to the project as well as the materials needed to complete the work. With this competitive edge the company can offer its product at the lowest cost to the consumer.

Marketing Strategy
Avalon Homes understands the importance of marketing and our innovative approach to the sale of these properties is a definite strength of the project and one that will ensure its success. Avalon plans to market the project through a variety of methods. First, we will leverage our pre-existing contacts with the local real estate companies. By implementing a referral system with real estate brokerages, utilizing VIP, Platinum, and Executive Agents who will hold public live events to help sell the units, we will be able to ensure that we have 20-40 exclusive arrangements with brokerages and agents who will work diligently to sell out the project. We will also air radio spots and publish ads in a variety of magazines. We will also make use of billboard advertising, which is a proven tool in the Ottawa and Toronto regions. Finally, we will look to conduct an online campaign utilizing resources such as “Property Spark, Facebook, and Google” to promote the project as a sound investment.

Sales Strategy
We will have somewhere between 160-200 semi-detached homes for sale. Our sales strategy will be one which involves a two-pronged approach to the sales. We will be looking to promote the units to individuals and families to live in. The main target however will be investors from Southern Ontario, the Greater Toronto Area, and the Ottawa Region. With a product that will include elements such as:

Rental Guarantee (Between 2-4 years)
Property Management (5 years)
Lake views
Larger Lots
Capped Development Charges
Free Assignment Clause
Free Customization of Floorplan

There is a lot for an investor to be excited about. Our goal from an investor standpoint is that this will be a virtually a risk-free investment for several years. That combined with an emphasis on quality, timeliness, and low cost this project is sure to be a hit with investors.

Sales Forecast
Individuals in our target markets are accustomed to spending much more for investments. For example, a recent project in Waterloo, Ontario (Canada’s Silicon Valley) had units under 700 sqf selling for $340,000 to $450,000, these units also required the owner to pay the rental fee for the water tanks and HVAC systems. We will be able to offer our units, which come with no hidden fees for between $400,000 and $499,900. The units will be double the size and have no maintenance fees. Condos in Toronto, Brampton, Mississauga, Vaughan, North York and Oakville often sell for greater than what we would be charging for a semi-detached home. Semi-Detached properties in these areas can sell upward of $1,000,000 with the average price in the $800,000 range.

We are confident that our target markets along with our marketing strategy will enable us to find 160-200 individuals who would see this as an excellent opportunity.

The Market

Imagine having the opportunity for work-life balance, with a 10 minute commute to work and a short drive to your weekend escape. Sudbury’s 330 lakes and hundreds of kilometers of trails offer endless opportunities to create lasting family memories.

The City with a population of roughly 170,000 people boasts an unparalleled combination of urban amenities and natural assets, and is also known for its friendly people and a place that welcomes and encourages talented individuals from diverse cultural backgrounds and lifestyles. With its world-renowned attractions, urban comforts and four-season outdoor adventures, Greater Sudbury continues to surprise and impress.

Sudbury is a bilingual city with the third largest Francophone population in Canada outside of Quebec. Together with people of many different ethnic backgrounds, including Italian, Finnish, Polish, Chinese, Greek and Ukrainian ancestry, Greater Sudbury’s multilingual and multicultural fabric is one of the most diverse in Canada.

Objective/Future (Use of funds)

Funds will be used to pay off the land completely, engineering, early development, and start-up costs.

Funds will also be used in the initial marketing campaigns for the project.

Funds will be used to pay off the land completely, engineering, early development, and start-up costs.

Funds will also be used in the initial marketing campaigns for the project.

Exit Strategy

The Exit strategy is an easy one. With over 50 Platinum agents and various brokerages working with us, we feel that selling the units will be the easiest part of what we have to do. This is a "home run" in terms of a real estate project and we look forward to selling our units, and paying back our investors so that we can hopefully move on to a new project.}

Make an offer

Join our team

Looking For : Fund Raiser
Equity : 5%

We would be happy to work with anyone who can help us achieve our goals. We have a great product, an awesome location, and a business plan to bring it all together. The expertise that a Fund Raiser could bring would enable us to realize our goals faster. There would also be additional opportunities for a good fund raiser with us as well as we plan to do additional projects in the future.}

Reviews, Comments and Questions

Interesting project. I wish you all the best with it.

March 21, 2019

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