Subject Property| FINANCING REQUEST| To finance construction of subject
The Villagio at Austin property. The borrower requests competitive development debt financing.
Austin, TX PROPERTY DESCRIPTION |
Loan Type| Construction Physical: SH-620 North near Anderson Mill Rd.
Loan Purpose| Ground-up Legal:
Property Type| Mixed-Use Zoning: Not Applicable
As-Is Value|$10,000,000 Unit Mix: 288 apartment units/ 6 restaurants / Office/Retail
As-Completed Value|$118,451,540 NRSF: Retail/Office – 150,000 Multifamily - 311,000
Price Per SF|$257 Avg SF: 900 sf per apartments
Total Dev Costs|$91,603,425 Lot Size: 30 Acres
Loan Requested| $72,800,000 # of Bldgs: Retail – 10 Office - 2 Multifamily - 2
LTC| 80% Frontage: 49,240 sf
Pro Forma NOI| Utilities: Municipality – City of Austin
$4,275,000 Retail/Office # of Parking Spaces/Parking Ratio:
Surface Parking @ 420
Principal Cash Contribution| Structured Parking @ 750
$18,803,425 Total Parking @ 1170
Apartment Ratio 1.66/unit
Principal Borrower(s)| Commercial/Retail – 3.5/1,000sf
The Marcel Group Restaurants – 10/1,000sf
P.O. Box 9556
The Woodlands, Texas 77387 Amenities: Structured parking, lush landscaping, natural park/lake
www.marcelinc.com settings, etc.
PROPERTY BACKGROUND |
Background: The Villagio is a Class-A mixed-use development in Austin near Lake Travis and Anderson Mill Rd. The
property serves to satisfy pent up retail and apartment demand in the vibrant and bustling community. The Villagio will
contain apartment for upper income A-credit tenants as well as retail and office uses throughout the property. In
addition, the property will have natural park settings and a lake on premises. Absorption and demand has been strong in
Austin for the intended uses of this project.
Tenant profile: Regional credit tenants for retail/office. Upper income, strong credit apartment tenants.
Recent Occurrences: Recent multifamily density bonuses have provided favorable approvals in addition to a more
attractive return profile on the Villagio at Austin project.
Existing Debt : Land acquisition per option contract to take place before December of 2007 in the amount of
$6,500,000 plus soft costs.
Leasing Management: Retail leasing will be performed by the Marcel Group’s in-house leasing team.
www.marcelinc.com. Third-party management will be provided for multifamily component.
Entitlement Status: Fully entitled
Total Development Cost: $91,603,425
As-Completed Value: $118,451,540
Absorption Period: 8-10 months
Expected Stabilization: 30 months
As-Completed LTV: 60%
Economic Market Report: http://recenter.tamu.edu/mreports/AustinRRock.pdf
Real Estate News-Austin/RoundRock: http://recenter.tamu.edu/mnews/mnsearch.asp?AID=3&TID=&STX=
Austin Economic Profile: http://www.austin-chamber.org/DoBusiness/GreaterAustinProfile/index.html
Workforce Data: http://www.austin-chamber.org/DoBusiness/GreaterAustinProfile/workforce.html
City/County Plan: http://www.austin-chamber.org/DoBusiness/AboutOpportunityAustin/About.html
Nearby Developments (complementary growth ie retail, office): http://www.globest.com/cgi-
Historical/Current Occupancy: 95% for both residential and retail.
Rental rate trend: 5% per annum
Units in Inventory: N/A
Building Permits: http://recenter.tamu.edu/data/bpgis/Austin.html
Borrowing Entity (SPE): To form separate entity with borrowers and equity investors.
Guarantor(s): Compass Cos., Marcel Construction & Maintenance, Charles & Vernon Veldekens
Background: Real Estate Development
Track Record: Multiple retail developments throughout Texas. www.marcelinc.com
Credit Score: 800+
Net Worth: $20MM+
Cash into Deal: $18,803,425
SOURCES & USES
Senior Debt $72,800,000
Subordinated Debt: Seller Financing N/A
Subordinated Financing: Mezzanine N/A
Cash Contribution $18,803,425
Imputed Equity N/A
Use of Loan Proceeds: Land acquisition and ground-up development of The Villagio Project.
Land Acquisition $6,500,000
Soft Costs – Expenses/Developer Fee $18,183,425
Interest Reserves $5,750,000
Development Costs - Hard $61,170,000
Estimated date of repayment: Spring 2010.
Financial Exit Strategy: Permanent takeout of construction financing subsequent to stabilization to take place 30
months from construction financing.