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Business Plan for a Real Estate Project document sample
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Construction and Real Estate Holding Company
THIS DOCUMENT IS A BUSINESS PLAN AND DOES NOT IMPLY AN OFFERING OF SECURITIES. IT IS INTENDED
SOLELY FOR THE USE OF THE PERSON WHOSE NAME IS SET FORTH ON THE COVER PAGE, AND ANY
PERSON’S OR ADVISORS, AND MAY NOT BE GIVEN TO ANY OTHER PERSON OR REPRODUCED.
This document is a business plan and does not constitute an offer
to sell or a solicitation to purchase. It contains confidential
information, including trade secrets, and may not be reproduced
without the express permission of the company named below.
Romack Holding Group, LLC.
Seeks Investor Contributions
In The Amount Of
$10,000,000
Sept 5, 2005
EXECUTIVE SUMMARY
1.0 Introduction
Romack Holding Group (RHG) is a parent company of a profitable commercial construction
company with 26 years of quality commercial development in central and south Florida. Romack
Construction Group (RCG) currently has 4 major contracts in the central Florida. Romack is
expanding its businesses services with four new divisions that feed off of its successful
construction business.
CURRENT PROJECTS
Osceola Kissimmee Area Business condos at a cost of $ 6.0 million
RHG equity in project = $ 900,000 Profit = $ 5.0 million
Osceola Kissimmee Area Business condos at a cost of $ 3.5 million
RHG equity in project = $ 1 million Profit = $ 2 million
Seminole County Lake Mary Area Business condos at a cost of $ 2.6 million
RHG equity in project = $ 1.5 million Profit = $ 2.6 million
Osceola Kissimmee 5 miles from Disney 11 Acre condo at a cost of $ 17.8 million
RHG equity in project = $ 2.3 million Profit = $ 11.1 million
Other Pending Romack joint venture projects include;
PENDING PROJECTS
300 acres of land in Osceola county for single family homes and condo mix use development.
Cost is $ 142.4 million Profit is $ 62.6 million
800 acres of land in Osceola county with Thoroughbred and Quarter horse racing and wagering
track with resort and mix use homes. Cost is $500 million Profit is $800 million
1.1 Mission
Romack Holding Group seeks to streamline the
commercial development process from raw land
acquisition to product financing.
Strategic alliances and Joint ventures with
companies operating under the umbrella of Romack
Holding Group enable us to leverage important
relationships in the Orlando area and create valuable
business opportunities.
1.2 Keys To Success
• Many relationships among the commercial real estate community.
• Impeccable and unique workmanship.
• Retaining high-quality, on-site management.
• Ensuring estimates on price and completion dates are as accurate as possible.
• Track the progress of each construction project to insure the scope cost and schedule
of each is maintained.
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COMPANY SUMMARY
2.0 Company Summary
RHC is a 26 year business managed by three partners who have 80 years of
combined experience in the commercial construction business. The contacts that
each partner has in the commercial real estate business proves their knowledge of
the construction business is extremely valuable from their operations. These three
partners represent sales/management, and finance/administration areas of the
business.
2.1 Company Ownership
The company is led by CEO Mike Romack and assisted by his two sons Jet and Newly
who lead different divisions of RHG. RHG has joint venture arrangements with both
architecture and engineering companies with over 30 years combined experienced.
One of the company's goals is to focus on high quality
workmanship, retaining as much talent as possible is
crucial. Therefore, the company plans to add more
partners to the firm as opportunities arise.
2.2 Company History
The company started in 1979 as a general contractor in residential home and church
construction. Mike Romack has been a commercial contractor since 1971. The
company began building and managing the construction of 18 churches in Southeast
USA and is proud of its early heritage and contributions.
During a period of 5 years, the company began manufacturing custom baseball bats
for major league stars. Baseball is a passion for Mike Romack and a hobby
blossomed into a business as his craftsmanship and attention detail became
legendary.
Major league baseball stars such as Barry Bonds, Ozzie Smith, Frank Thomas and
even Michael Jordan sat in the Romack kitchen eating breakfast prepared by Mike
Romack`s wife and playing with the future Romack management children as their
bats were custom built. There are dozens of signed collector bats from professional
baseball players on display at the RHG corporate office in Kissimmee Florida.
The company expanded and is focused on being a commercial contractor in the
Orlando market and has a resume of many successful projects to add to their trophy
case. Projects from $ 500,000 to $ 50 million receive the same personal attention to
quality and service as the baseball stars. Today the company offers commercial
construction for commercial office parks, warehousing, retail centers, condominium
projects, home construction, site development, engineering, and transportation.
The company is expanding into a development and financial company in 2005. RHG is
unique and many of its subcontractors have been loyal for its 26 year history which
brings consistency of quality to each job performed. Currently, Romack construction
does complete construction needs except for plumbing and electric work. The biggest
advantage of the company is delivering a quality project on schedule and on budget.
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PRODUCT & SERVICES
3.0 Product & Services
RHG provides commercial construction services, with a primary focus on large urban
structure development. This includes the following types of construction:
• Office buildings
• Condos & Single Family Homes
• Strip malls
• Commercial parking lots and garages
• Apartment complexes
• Restaurants
• Schools
• Government contracts
RHG has four divisions and the Romack Construction Group (RCG) provides revenue
opportunities as a part of building re-construction projects. RHG is the managing
company and majority shareholder of;
• Romack Development Group LLC
• Romack Construction Group LLC
• Romack Transportation Group LLC
• Romack Material Group LLC
• Romack Financial Group LLC
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FINANCIAL REQUIREMENTS
4.0 Financial Strategy
Romack Holding Group is seeking investor contributions, totaling $10,000,000, by
Sept 5, 2005. This cash infusion will result in dramatic revenue and income growth,
over the five-year planning period, and position the company to continue its master
planned development of existing and pending construction projects.
The four initial projects require$10 million in funding in the Orlando market with a 24
month completion. RHC will also be securing $ 55.5 million in construction financing.
4.1 Projected Operating Results.
Revenues are projected to increase, from $7 million, in FY1, to $122 million, in FY5.
After-tax net income is projected to increase, from $1.4 million, in FY1, to $44.8
million, in FY5. The minimum cash balance is $4,095K, occurring in Month 9, and
the FY5 ending cash balance is $48.8 million.
Performa
Year 2005 2006 2007 2008 2009
Revenues 7.0 28.0 38.0 65.0 122.0
Expense 5.6 19.2 22.3 35.1 73.2
EBIT (mill) 1.4 8.8 15.7 34.9 48.8
4.2 Mortgage Backed Securities
All Romack development projects are backed by first or second mortgage bonds.
Romack Financial Group manages multiple divisions for commercial project
development and these securities are backed by real property held by Romack
Holding Group.
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COMMERCIAL PERMITTING FLOW CHART
Romack’s first name relationships with the several Orlando Board Of Commissioners
expedite the permitting procedure with the Department of Economic Development
and Tourism.
With the cooperation of the Department of Growth Management, the Department of
Public Works, the Orange County Health Department and additional agencies,
Romack streamlines the permitting process. We understand the bureaucracy of filing
the necessary paperwork to apply for building permits in Orange County.
We use the flow chart provided and Professional Engineers to get building permits
approved ASAP.
ABDEL-ATY, MOHAMED AHMED MONAHAN, JAMES P CANNATA, MARC ANTHONY
License Number 55986 License Number 57546 License Number 58570
Professional Engineer Professional Engineer Professional Engineer
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ROMACK DEVELOPMENT GROUP RDG
5.0 Vision
The company’s five-year mission is to master plan and develop premier land holdings
in the central Florida area and become a signature land developer. Securities backed
by Romack land holdings are the backbone to guarantee our companies future
success.
By carefully planning and executing development of
land holdings, leveraging well cultivated strategic
alliances, and facilitating construction, RDG intends to
prepare raw land holdings for infrastructure,
permitting, and civil engineering site preparation for
residential and commercial projects.
Maintaining relationships among Central Florida
commercial real estate players is a key to our success.
Romack has several relationships in place with a circle
of high level real estate experts in the Orlando area.
5.1 Joint Ventures
RDG is very capable of dealing directly with property
owners for an equity position in projects that 99% of
our competition are not qualified to offer. These skills
bring our business operations to a level our competition
is unable to compete with.
We are competent in the due diligence of this nature
and we know how to process city and state building
permits for Orlando development ventures.
Every project we acquire requires hundreds of hours of paperwork, appraisals, title
analysis, legal structure, and equity participation. Joint ventures are a springboard
to feeding work to our construction, transportation, materials, and financing
companies and increase our bottom line significantly.
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ROMACK CONSTRUCTION GROUP RCG
6.0 Summary
Romack Construction Group provides RHG with 80 years experience in the high end
construction industry. One unique aspect of RCG is that it has the ability to self-
perform most items on a project. This includes site work, concrete, asphalt, steel,
drywall, masonry, carpentry and exterior finishes.
Romack construction aims to provide high quality craftsmanship in the commercial
construction industry at a competitive cost. It is the goal of the company to achieve
a reputation for quality and on-time delivery superior to competitors in the central
Florida region. RCG maintains high integrity on all promised timelines and quality
assurances.
Commercial development of condos and
apartment units have been our strongest revenue
generator and we continue to seek profitable
opportunities in this area.
6.1 Strategic Partners
Fabre Engineering provides Romack with civil and
environmental engineering and land surveying
services for all types of projects.
For more than twenty years, Fabre Engineering &
Surveying has been selected and re-selected to
provide engineering and surveying services for
clients, such as utility companies, architects, land
developers, industries, The Department of
Defense, and governmental agencies.
Bullock Tice Architectural combines in-house
service capabilities with those of Romack’s
strategic alliance partners and provide clients with
custom-tailored, integrated, “Total Solutions”.
Title Attorney Tom Smith provides Romack with
Legal services in several areas including General
Business Law; Real Estate Law; Oil and Gas Law.
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ROMACK MATERIAL GROUP RMG
7.0 Summary
Romack Material Group achieves a 15% profitability margin by helping RHG achieve
Supply Chain Management excellence. Assisting other divisions of the Romack
companies, RMG deals directly with manufacturers, distributors, and retailers to
deliver building materials on time to Romack projects.
7.1 Electronic Bidding Sites
Electronic bidding sites enable Romack
construction projects to continually
supply raw materials, parts,
subassemblies and finished assemblies.
RMG knowledge of Just-In-Time (JIT), lower cost, and higher quality delivery of
construction materials is a very critical Supply Chain Management process.
7.2 Electronic Data Interchange (EDI)
RMG has 7 major southeastern distributors that provide competitive bids for building
materials that are used on construction sites. RMG has EDI accounts set up with
these distributors that streamline the delivery and payment of products.
1. Identify the processes for inherent delays proposing a
methodology and techniques for continuous
improvement of both the operative and site work.
2. Redefine roles and activities of all involved in projects
from the client through to the operative in an attempt
to remove the barriers to efficiency and quality.
3. Develop expertise in all the component parts
necessary to achieve a good production engineering
approach through developing project teams committed
to achieving an integrated project approach.
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ROMACK TRANSPORTATION GROUP RTG
8.0 Summary
Romack Transportation Group supplies heavy
materials for infrastructure development to
construction sites This includes cement Storm
Drainage, Manholes and Junction Boxes, and
Catch Basins.
The Transportation Group provides services first
for Romack projects and secondary contracts for
other site work contractors.
RTG is targeting existing construction companies
that need our transportation services. Because
these services are perishable, we don’t make
money when our trucks are idle.
Site work preparation and transportation of
materials such as fill dirt and Storm Drainage
basins generate a 22% profit margin. It only
makes sense to utilize our transportation
equipment and we are making $5,000 per day
delivering material in this manner.
Romack Transportation Group delivers the following material to construction sites.
• Concrete conform to ASTM Designation C-150 Type II cement
• Masonry Mortar. Masonry mortar (grout) strength of 2000 psi.
• Reinforcing Steel ASTM A-615, Grade 60 with deformed bars.
• Connectors 15" diameter (Min.)
• Castings No. 16 (Standard Detail-S-716) with a tensile strength of 35 ksi.
• Manhole Steps in conformance to the Standard Detail
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ROMACK FINANCIAL GROUP RFG
9.1 Summary
Romack Financial Group (RFG) is a financial
subsidiary of RHC and manages residential and
commercial project funding via Mortgage-
Backed Securities. The Financial side of RFG
orchestrates complicated transactions between
both investors and consumers. RFG is a end-
user business and facilitates direct sales of
Romack products with consumers.
RFG is a “private-label” mortgage company in
contrast to an “agency” company.
9.2 Residential MBS’s
Mortgage Backed Securities (MBS’s) are
securities that offer investors a wide range of
maturities from a pool of tranche’s. Each tranche
provides an investor his own interest rate and
payment schedule. RFG underwrites and
manages residential project MBS’s for investors
involved in Romack projects.
RFG works directly with Romack products that are
ready for sale to consumers. This soup to
nuts approach involves Real-Estate Agents,
Real-Estate Brokers, Title and Insurance, Mortgage, and Financing companies (RFG).
9.3 Commercial First Mortgage Bonds
All Romack development projects are backed by
first or second mortgage bonds. Romack
Financial Group manages multiple divisions for
commercial project development.
RFG works directly with commercial brokers and
owners who are willing to contribute real
property in exchange for a percentage of future
profits. This means relationships and
negotiations are based on a detailed market and
data analysis. The market and data analysis
provide a detailed report forecasting profits and timelines for qualified projects. Each
report is prepared by a qualified research analyst.
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PENDING PROJECTS
The land requirement for the racetrack – grandstand, track, stables and parking – is
approximately 320 acres. Appropriate parcels currently available range from 320
acres for $25,000,000 to 750 acres for $45,000,000 to 600 acres for $90,000,000;
pricing being an obvious factor of location (i.e., distance from Disney World).
As a recent development boom in the area has triggered increased land values and
constrained availability of suitable property, final pricing and location will be
determined once financing has been secured.
The larger parcels offer the advantage of resale of partial acreage to hotel and resort
or property developers as Orlando’s need for new hotel and housing space continues
to grow apace.
800 acres of land in Osceola county with Thoroughbred racing and wagering track
with resort and mix use homes. Cost is $500 million Profit is $800 million
INFRASTRUCTURE & FACILITIES
A world-class stadium is envisioned, able to accommodate up to 30,000 patrons at any given
event. The complete facility would comprise:
Grandstand with tiered levels of race watching comfort and exclusivity
– from open-air bench seating to exclusive skyboxes
• Multi-purpose professional track with high-tech composite outer oval
and inner turf oval
• Professional stables and exercise areas plus profit-generating
accommodation for horse owners, staff and patrons
• State-of-the-art wagering, judging and audio-visual systems and
equipment
• Large-scale simulcast viewing lounges
• Three levels of food and beverage outlets – kiosks, group dining room,
and a formal five-star restaurant and lounge – as well as full catering
services
• Hobbyist equestrian areas – including riding school, boarding stables
and riding trails
• Polo field
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DRI, Planning & Engineering
The impact of a facility of this size and nature requires the careful study and conduct
of professionals who are capable of satisfying local and state governing bodies
charged with oversight of roads, water, environment, etc. services and other general
design features of the project as they impact on the area and its residents.
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REFERENCE:
1 http://myregion.org/myregion/default.asp
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