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executive-summary-villa-toscana

VIEWS: 74 PAGES: 26

									                     Executive Summary
                             Of


VILLA
  TOSCANA
           36 Premium Single-Family Home Sites
                    Washington, Utah
                         February 13, 2008




Villa Toscana Plat
                                TABLE OF CONTENTS
1. Project Overview………………………………………………………………….. 1
     A. Design Philosophy……………………………………………………………...                                                      1
     B. Architectural and Building Material Elements………………………………….                                       1
     C. Community Design Concepts…………………………………………………...                                                  1
            Figure 1 – Sample Home…………………………………………………..                                                  2
            Figure 2 – Sample Entry…………………………………………………...                                                2
            Figure 3 – Majestic View…………………………………………………..                                                2
            Figure 4 – Phase 2 View…………………………………………………...                                                2
            Figure 5 – Warner Ridge View…………………………………………….                                               2
            Figure 6 – Sign View………………………………………………………                                                    2
            Figure 7 – East View……………………………………………………….                                                   3
            Figure 8 – South View……………………………………………………..                                                  3
            Figure 9 – Nearby Scenic Wonders of Southern Utah……………………..                                  3

2. Team Members…………………………………………………………………… 4
3. Company Ownership…………………………………………………………… 4
4. Funding Needs, Uses and Proceeds……………………………………… 5
            Exhibit A - Proposed Schedule of Cash Flow……………………………... 5

5. Project Timeline and Comparable Sales Information……………….. 6
     A. Milestones and Timeline Overview…………………………………………….                                               6
            Exhibit B - Projected Sales Timeline (Phase 1 & 2)……….………………                                 6
     B. Property Values of Comparable Size “Ready to Build” Lots and Competitors...                      7

6. Current & Projected Population Growth of Washington, Utah…... 7
7. Market Growth……………………………………………………………………... 8
            Figure 10 – Washington City, UT Planned Area Development…………...                              10

8. Real Estate Market Conditions and Economic Trends (Local &
State) ……………………………………………………………………………………... 11
9. Utah State Economy & Job Market………………………………………… 16
10. Other Benefits – Washington City/St. George Region……………. 17
11. Villa Toscana Development – Overhead Views of Property…... 18
            Figure 11 – Overhead View of Property…………………………………...                                        18
            Figure 12 – Bird‟s Eye View of Property………………………………….                                        19

12. Villa Toscana Floor Plans & Elevations………………………………... 20
            Figure 13 – Floor Plan #1 ..…………..........................................................   20
            Figure 14 – Floor Plan #2 ..…………..........................................................   21
            Figure 15 – Floor Plan #3 ..…………..........................................................   22
            Figure 16 – Floor Plan #4 ..…………..........................................................   23

13. Conclusion………………………………………………………………………... 24
                                                                                                    1


1. Project Overview
Surrounded by Majestic Rural, Natural Mountain and City views, Villa Toscana offers a unique
opportunity to make your home in the beautiful surroundings of Southern Utah while maintaining
a serene, comfortable lifestyle. Nestled at the base of Warner Ridge on the scenic East Bench of
Washington City, Utah, Villa Toscana is the premier Southern Utah residential development. The
Design Guidelines, Building Elements and Design Concept listed below will ensure the quality of
life and timeless value you‟ve come to expect when you purchase a home surrounded by such
natural beauty. Modeled after the classic Italian, Mediterranean and Tuscan styles of architecture,
the homes built in this quiet, upscale community are sure to have lasting value. With a rich blend
of Old World style and craftsmanship and modern comforts and conveniences, each home will
reflect a custom, yet connected expression of enduring style.

    A. Design Philosophy:

        The creation of an appropriate setting for your home requires thoughtful planning.
        Architectural and landscape design play an important role in creating a cohesive,
        integrated concept that allows flexibility without sacrificing predominant values. A
        design review committee has been established to ensure these critical considerations and
        allow home and property owners to present concepts that could be limited by a strict code
        of restrictions intended to serve the same purpose.

    B. Architectural and Building Material Elements:

        In the late nineteenth century, southern Europe produced some the most fashionable,
        architecturally appealing styles in history. The rural design elements of Tuscany were
        inspired by the dramatic landscape in which it was incorporated. Blending with the
        natural beauty was paramount then and there, and is also here and now. Asymmetrical
        forms, Courtyards, Natural Building Materials, Prominent Towers, Slight Roof Pitches,
        and Bordered Entryways are all elements that should prevail in the design of homes
        constructed in Villa Toscana. Local codes and set back requirements must also be strictly
        observed. Stucco, natural and/or quality cultured stone, tile roof, doors and other
        elements should be of a good quality and colored in “Warm Earth Tones”. Porches,
        Porticos, Archways and Garages should enhance the design and blend with the elements
        and details of the home. Both single story and multi story homes (with and without
        basements) are suitable for construction when these criteria are applied.

    C. Community Design Concepts:

        The character of Villa Toscana is influenced by the geographical similarities of southern
        Utah and southern Europe and Italy. The mountain, rural and mesa views are unique to
        this area and home design should embrace the scenic splendor that prevails.

To date, 20 of the 36 lots are complete and are ready to be recorded. Washington Estates, LLC
was organized for the purpose of developing Villa Toscana and is comprised of well-qualified
real estate investors who see the value in, and growing economy of, the Washington City area of
Southern Utah (located approximately 5 miles north of St. George, UT). C.F. Rice Construction
is under contract to design and construct homes in accordance with these guidelines. The
following pictures detail the current condition of the project and some examples of homes and
details planned for the development.
                                                           2




Figure 1 - Sample Home           Figure 2 - Sample Entry




Figure 3 - Majestic View        Figure 4 - Phase 2 View




Figure 5 - Warner Ridge View   Figure 6 - Sign View
                                                                                                3




Figure 7 - East View                                 Figure 8 - South View




 Figure 9 - Nearby Scenic Wonders of Southern Utah

As seen in these photos, panoramic views, natural splendor and a quiet rural setting are among the
greatest assets Villa Toscana has to offer. When you couple this environment with dramatic,
state-of-the-art homes designed to accent the picturesque surroundings, the results will be
stunning.

Growth of this community is certain. Washington City continues to expand in all sectors of
economic measure. A new municipal airport, construction of the „Southern Corridor‟ and
community improvements including golf courses, parks and the nearby Red Cliffs Desert Reserve
are just a few master planned amenities that will enhance the lifestyle cherished by families and
individuals that will call Villa Toscana their home. It is easy to see the enduring value,
comfortable lifestyle and natural beauty that draw so many to this beautiful area of Southern
Utah.
                                                                                                     4


2. Team Members
Each team member will play a crucial role in the overall success and profitability of the project.
The following details the team members and the role each plays in the project.

   Project Manager: Nelson Moak - Nelson has been, and will continue to be, involved in the
    development as an independent Project Manager. He is experienced in all facets of the
    development process. He has developed relationships with local municipalities and
    contractors and knows the value of those relationships. He has completed the entitlement
    process, negotiated contracts, managed the construction and maintained the budget on behalf
    of Washington Estates LLC.

   Land/Infrastructure Construction: Dennett Construction - With over 60 years combined
    residential and commercial development construction and planning experience, Dennett
    construction is trustworthy and competent. They have completed the horizontal construction
    on the first 20 lots (Phase 1) and will complete phase 2 per instructions.

   Home Construction Contractor: C.F. Rice Construction - C.F. Rice construction is a 3rd
    generation builder that focuses on building enduring quality and style. Washington Estates
    LLC has contracted with C.F. Rice to construct 36 single family homes. In choosing a
    contractor, reputation, experience and value were the things considered most. C.F. Rice
    construction meets and exceeds the requirements set forth in the design guidelines and
    community design concepts.


3. Company Ownership
Washington Estates, LLC is a Utah Limited Liability Company organized for the purpose of
acquiring, developing and selling of the Villa Toscana project. Washington Estates, LLC is
comprised of well-qualified real estate investors who see the value in, and growth of the
Washington City area of southern Utah. The primary objective of the group is to enhance the
community by providing real lasting value for the home owners and to realize a profit in the
process. The members of Washington Estates LLC and their corresponding percentage of
ownership are outlined below.

    Names and full addresses of Washington Estates, LLC members:

LLC Member                  Full Address                          Percentage of Ownership
Richard W. Colver           2261 Cardiff Circle                   24.242%
                            El Dorado Hills, CA 95762
Kevin J. Colver             114 North Clark Lane                  30.303%
                            Elk Ridge, UT 84651
Jared R. Bryant             120 Burwood Way                       15.152%
                            Folsom, CA 95630
Timothy J. Barkocy          15917 Dawson Creek Dr.                15.152%
                            Monument, CO 80132
Justin Strong               2550 Shadow Fax Lane                  15.152%
                            El Dorado Hills, CA 95762
                            TOTAL                                     100.000%
                                                                                                                            5


4. Funding Needs, Uses and Proceeds

We are seeking financing in the amount of $7,500,000 to be secured by a first position deed of
trust on the entire 16.33 acre parcel(s) and all improvements thereto. As the phases are recorded
and individual parcels are created, the deed of trust will encompass all lots that are associated
with the parcels in this development. The funds will be used to re-finance the current debt
associated with acquisition and development costs to date, complete the horizontal construction
of phase 2 and to construct 32 of 36 homes to be built on the lots provided in this development.
The term requested to ensure the absorption of the homes based on current and projected market
conditions is 60 months. Our projections are divided into ten 6-month periods. This time line is
conservative and allows for adjustments along the way. Expectations are that the proceeds from
home sales will service and eventually satisfy the debt and provide a net profit in excess of
$3,000,000. The Proposed Schedule of Cash Flow (Exhibit A, below) outlines the expected
draws, proceeds, ending value, and LTVs for each period:

Exhibit A - Proposed Schedule of Cash Flow
                                                                                                      (3)
                               Beginning                   (1)             (2)       Ending        $ Value at
                                 Loan                     Draw            Sales       Loan           End of
Months        Draw Date         Balance        Ref        Amt           Proceeds     Balance         Period        LTV

1-6         01-Mar-2008                  0      (a)      5,140,000               0   5,140,000      6,775,000      76%
7 - 12      01-Sept-2008         5,140,000      (b)      1,850,000       2,175,000   4,815,000      6,963,000      69%
13 - 18     01-Mar-2009          4,815,000      (c)      1,864,000       1,370,000   5,309,000      7,609,000      70%
19 - 24     01-Sept-2009         5,309,000      (d)      1,530,000       1,380,000   5,459,000      7,766,000      70%
25 - 30     01-Mar-2010          5,459,000      (e)      1,760,000       2,130,000   5,089,000      7,582,000      67%
31 - 36     01-Sept-2010         5,089,000      (f)      1,940,000       2,340,000   4,689,000      6,497,000      72%
37 - 42     01-Mar-2011          4,689,000      (g)      2,000,000       2,340,000   4,349,000      6,716,000      65%
43 - 48     01-Sept-2011         4,349,000      (h)      2,100,000       3,120,000   3,329,000      5,952,000      56%
49 - 54     01-Mar-2012          3,329,000       (i)     1,950,000       3,220,000   2,059,000      5,188,000      40%
55 - 60     01-Sept-2012         2,059,000       (j)     2,250,000       4,830,000   (521,000)      2,716,000     (19%)

Total                                                  22,384,000      22,905,000                   2,716,000

Detail of Draws:
(1)(a) - $5,140,000 = Current Debt: $3,450,000 (ANB); $1,250,000 (Wash The Fields); $500,000 (Toscana Vista); Balance Due
on Const: $215,000 (Dennett Construction); Closing Costs ($125,000)
(1)(b) - $1,850,000 = Complete Horizontal Land Work/Construction: Utilities, Paving, Sidewalks etc. on Phase 2 - $265,000
(Dennett Construction), 6 Mo. Interest $300,000, Const. of 3 Homes (Units 1,2 and 3): $1,285,000 (C.F. Rice Construction)
(1)(c) - $1,864,000 = Construction of 4 Homes (Units 4,5,6 and 7): $1,564,000, 6 Mo. Interest $300,000
(1)(d) - $1,530,000 = Construction of 3 Homes (Units 8,9 and 10): $1,230,000, 6 Mo. Interest $300,000
(1)(e) - $1,760,000 = Construction of 4 Homes (Units 11,12,13 and 14): $1,460,000, 6 Mo. Interest $300,000
(1)(f) - $1,940,000 = Construction of 4 Homes (Units 13,14,15 and 16): $1,640,000, 6 Mo. Interest $300,000
(1)(g) - $2,000,000 = Construction of 4 Homes (Units 17,18,19 and 20): $1,700,000, 6 Mo. Interest $300,000
(1)(h) - $2,100,000 = Construction of 4 Homes (Units 21,22,23 and 24): $1,800,000, 6 Mo. Interest $300,000
(1)(i) - $1,950,000 = Construction of 4 Homes (Units 25,26,27 and 28): $1,800,000, 6 Mo. Interest $150,000
(1)(j) - $2,250,000 = Construction of 4 Homes (Units 29,30,31 and 32): $2,100,000, 6 Mo. Interest $150,000

Detail of Sales Proceeds:
(2)(a) - $0 = No Sales Projected in this period
(2)(b) - $2,175,000 = Sales of Units 1, 2 and 3 @ $725,000 ea. Avg.
(2)(c) - $1,370,000 = Sales of Units 4 and 5 @ $685,000 ea. Avg.
(2)(d) - $1,380,000 = Sales of Units 6 and 7 @ $690,000 ea. Avg.
(2)(e) - $2,130,000 = Sales of Units 8, 9 and 10 @ $710,000 ea. Avg.
(2)(f) - $2,340,000 = Sales of Units 11, 12 and 13 @ $780,000 ea. Avg.
(2)(g) - $2,340,000 = Sales of Units 14, 15 and 16 @ $780,000 ea. Avg.
(2)(h) - $3,120,000 = Sales of Units 17, 18, 19 and 20 @ $780,000 ea. Avg.
(2)(i) - $3,220,000 = Sales of Units 21, 22, 23 and 24 @ $805,000 ea. Avg.
(2)(j) - $4,830,000 = Sales of Units 25, 26, 27, 28, 29 and 30 @ $805,000 ea. Avg.
                                                                                                                     6

Detail - Value at End of Period:
(3)(a) - $6,775,000 = 20 Lots completed + 16 paper Lots with some improvements; As Completed Value $7,590,000 -
$815,000 completion cost.
(3)(b) - $6,963,000 = 33 Completed Lots @ $211K ea. Avg.
(3)(c) - $7,609,000 = 29 Completed Lots @ $211K ea. Avg. + Units 6 and 7 ($745K Appraisal avg. ea.)
(3)(d) - $7,766,000 = 26 Completed Lots @ $211K ea. Avg. + Units 8, 9 and 10 ($760K Appraisal avg. ea.)
(3)(e) - $7,582,000 = 22 Completed Lots @ $211K ea. Avg. + Units 11, 12, 13 and 14 ($735K Appraisal avg. ea.)
(3)(f) - $6,497,000 = 20 Completed Lots @ $211K ea. Avg. + Units 14, 15 and 16 ($759K Appraisal avg. ea.)
(3)(g) - $6,716,000 = 16 Completed Lots @ $211K ea. Avg. + Units 17, 18, 19 and 20 ($835K Appraisal avg. ea)
(3)(h) - $5,952,000 = 12 Completed Lots @ $211K ea. Avg. + Units 21, 22, 23 and 24 ($855K Appraisal avg. ea.)
(3)(i) - $5,188,000 = 8 Completed Lots @ $211K ea. Avg. + Units 25, 26, 27 and 28 ($875K appraisal avg. ea.)
(3)(j) - $2,716,000 = 4 Completed Lots @ $211K ea. Avg. + Units 29 and 30 ($936K Appraisal avg. ea.)

LTV Calculation: Ending Loan Balance / $ Value at End of Period

NOTE: If the milestones (shown above) associated with a certain period are met prior to the 6 month time
line, advancement of the next period will take place.



5. Project Timeline and Comparable Sales Information
A. Milestones and Timeline Overview

      Phase 1 (20 lots) is completed and ready to record as individual lots. These lots are fully
      improved, pad ready and have soil certifications. Of these first 20 lots, 7 have been reserved
      for construction of homes by individuals, builders and investors. It is expected that of these
      reservations, 3 will be ready to build during the first 6 month period. Upon verification of
      financing and /or funds required, construction of homes will begin. As outlined in Exhibit A
      (above), construction of the next 4 homes will begin once the first 3 are sold, contracted and
      verified. This pattern will continue until the project is sold out.

      The Projected Sales Timeline for Phase 1 & 2 is summarized in Exhibit B (below):

Exhibit B - Projected Sales Timeline (Phase 1 & 2)
                                       Sales
Months         Date         Ref      Proceeds



1-6        01-Mar-2008       (a)                0    No Proceeds Projected in this period
7 - 12     01-Sept-2008     (b)         2,175,000    $2,175,000 = Sales of Units 1, 2 and 3 @ $725,000 ea. Avg.
13 - 18    01-Mar-2009       (c)        1,370,000    $1,370,000 = Sales of Units 4 and 5 @ $685,000 ea. Avg.
19 - 24    01-Sept-2009     (d)         1,380,000    $1,380,000 = Sales of Units 6 and 7 @ $690,000 ea. Avg.
25 - 30    01-Mar-2010       (e)        2,130,000    $2,130,000 = Sales of Units 8, 9 and 10 @ $710,000 ea. Avg.
31 - 36    01-Sept-2010      (f)        2,340,000    $2,340,000 = Sales of Units 11, 12 and 13 @ $780,000 ea. Avg.
37 - 42    01-Mar-2011      (g)         2,340,000    $2,340,000 = Sales of Units 14, 15 and 16 @ $780,000 ea. Avg.
43 - 48    01-Sept-2011     (h)         3,120,000    Sales of Units 17, 18, 19 and 20 @ $780,000 ea. Avg.
49 - 54    01-Mar-2012       (i)        3,220,000    Sales of Units 21, 22, 23 and 24 @ $805,000 ea. Avg.
55 - 60    01-Sept-2012      (j)        4,830,000    Sales of Units 25, 26, 27, 28, 29 and 30 @ $805,000 ea. Avg.


Total                              $ 22,905,000
                                                                                                  7

   Phase 2 (16 lots) has been previously rough graded with the balance of construction
   scheduled to begin in mid March 2008. Phases 1 and 2 will be sold simultaneously, without
   restriction to encourage early reservations and absorption. It is anticipated that phase 2 will
   be completed and individual lots recorded in early June 2008. Final zoning and preliminary
   plat approvals for phase 2 have been granted and a construction permit has been applied for
   and approved. The current zoning for this neighborhood is R-1-15, defined as one single-
   family residence per 15,000 sq. ft. (minimum lot size) lot. The home sites in Villa Toscana
   range between 15,000 and 18,000 sq. ft. Careful consideration will be given to protect views
   and the overall vision of the development.

B. Property Values of Comparable Size “Ready to Build” Lots and Competitors

   Current sales of similar lots in the surrounding area average approximately $215,000 per lot.
   For example, in a neighboring subdivision there are currently 6 lots that have sold or are
   under contract to sell at $216,000. It is also important to note that although these neighboring
   lots are selling for $216,000, this neighboring property mentioned does not have the views,
   nor the more desirable neighborhood of Villa Toscana. Estimated values for Villa Toscana
   are between $210,000 and $225,000 per lot.

   There are several developments nearby that compete directly with Villa Toscana. Most are in
   basin area where the water table is just 2-3 feet below grade. In the underground construction
   phase of nearly all nearby developments, the water table was a major issue. Extra cost and
   care must be used when building in these areas. Villa Toscana is up, above the basin on a
   slight hill side, thus water problems and less than desirable views are two issues that are not
   associated with Villa Toscana. Galilee Heights Subdivision is just to the West and lower in
   elevation in relation to Villa Toscana. This is our primary competition. The marketing
   program for Galilee heights is to sell developed lots to consumers, builders and the like.
   Villa Toscana offers superior views and an opportunity to purchase a home that blends
   perfectly with the surroundings.


6. Current & Projected Population Growth of Washington, Utah

The following supporting information regarding Washington City‟s Plan for Growth was
obtained from the most recent Washington City General Plan (dated March 2005):

       Past Population Growth and Future Projections
       For over 20 years, Washington County has had steady population growth and economic
       growth. It has been one of the fastest growing areas in the state and it is anticipated that
       the County will continue to grow as more retirees move into the area and tourism
       increases. As of 2000, the population of Washington County was approximately 100,000
       and is expected to reach over 165,000 by the year 2020. It is anticipated that because of
       the high cost of land in St. George, a significant portion of Washington County‟s future
       development will occur in Washington City.

       Washington City grew rapidly between 1970 and 1980, with an annual growth rate of
       over 15%. This growth rate slowed down to an average annual growth rate of 3.4% from
       1980 to 1994. From 1990 to 2000, the City‟s population doubled, with a growth rate of
       6.9% per year. In 2005, the City estimated the population to be approximately 15,000, an
       annual growth rate of almost 13%! The City is projecting a population of over 36,000
       residents by 2020. The land uses in the General Plan indicate a „build-out” population of
       approximately 80,000 for the current City boundaries, and almost 120,000 including the
                                                                                                    8

        potential annexation areas. Washington City will clearly have significant growth. With
        that growth will come a significant change in the character and function of the
        community - by any measure, Washington City is on its way to becoming a major urban
        area.


7. Market Growth
Villa Toscana is situated in the heart of a new area of Washington City that has been planned and
approved for accommodation of the fast growing population. The focus of this new region is to
attract the increasing number of families and long-term residence through providing a “family
friendly” environment, along with all the associated amenities. Current development in the areas
surrounding Villa Toscana includes the new Southern Beltway, as well as schools, parks and golf
courses. In addition, the new city “commercial center” will provide families in the area
convenient access to services, shopping and other necessities (please see map at end of this
section that identifies these areas). Further, Washington City will soon be constructing an
international airport to service the local region. This airport is planned around the ability to
accommodate large commercial aircraft.

The following information from the Washington City General Plan (Dated March 2005) outlines
the main projects that are expected to fuel and support the growth of the area during the years to
come:

        New Regional Airport
        Being planned by St. George City in the southern section of Washington City (near the
        Arizona border) the new airport will bring a new level of air service to the Washington
        City/St. George area, which will attract both jobs and residents to the region. The
        immediate vicinity of the airport will also become a new focus for industrial
        development, and new roads and services will be required. Careful planning of the
        surrounding land and circulation will help Washington City attract uses that will take
        maximum advantage of the airport and allow it to function successfully with few
        conflicts.

        Southern Corridor
        The Southern Corridor Beltway, a proposed 21-mile limited access State highway, is
        being planned to extend from I-15 near the Utah-Arizona border east to the new airport
        then north around the east side of Washington City and northeast to State Route 9 in
        Hurricane. The Southern Corridor will become an important regional roadway - it will
        not only provide more direct access to the new airport, but will open up large areas in
        Washington City and St. George for major new development. The Beltway will also
        provide several new „front doors‟ to the east side of Washington City. Planning ahead
        will help us capitalize on these opportunities and avoid future conflicts or incompatible
        uses.

        Development in the Washington Fields
        Residential development has been gradually moving into Washington City‟s traditional
        agricultural area south of the Virgin River. In the past, development has occurred in
        isolated pockets, leaving a patchwork of farmland and subdivisions. Under the previous
        General Plan, subdivisions were developed with a range of densities. Growing pressure to
        develop the remaining farmland raises several important questions: Shall we try to
        preserve any of the farmland? If so, how will this be accomplished? If not, what
        development pattern will best avoid conflicts between adjacent developments?
                                                                                                         9


     Climate
     Another factor in the growth of the Washington Utah area is the desirable climate. Like
     other Sun Belt cities, Washington City‟s climate is an attraction in its own right.
     Washington City‟s combination of the warm, dry winter climate and natural beauty of the
     environment draws both new residents and tourists to the area.

     Washington City is located within the northern extension of the Mojave Desert. This
     southwestern setting, and its low elevation, provides the City with a desert climate
     characterized by low humidity (rapid evaporation), generally clear skies, relatively warm
     winters, and hot summers. The average annual temperature is approximately 61 degrees
     (Fahrenheit). As a result, people tend to enjoy the out of doors most of the year, except
     during the hottest days of the summer.

     Average annual precipitation is approximately eight-inches per year. This dry climate has
     attracted many who experience physical discomfort due to humidity. At the same time,
     this arid condition places a high importance on the availability of water. Water has been,
     and will continue to be, a key factor in Washington City‟s growth. The Washington
     County Water Conservancy District has contracted with Washington City in 2006 to
     provide sufficient water for planned growth.




     The Following table outlines average temperatures in the St. George Area by month.

                             Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Average Daily Maximum °F      54      60     68     77      86        96 102 100     93   80   65   54
Average Daily Minimum °F      26      31     36     43      51        59   67   65   55   43   32   26

                                   Data is for St. George Municipal
                                                                                  10

The map below (Source: Washington City General Plan (Dated March 2005) provides
information on planned area development including Schools, Parks, Commercial Centers,
Southern Beltway, and the new Airport:




Figure 10 – Washington City, UT Planned Area Development
                                                                                                     11


8. Real Estate Market Conditions and Economic Trends (Local & State)
When compared to other regions of the country, the St. George (and surrounding areas of Utah)
real estate market is strong. The Office of Federal Housing Enterprise Oversight (an independent
entity within the U.S. Department of Housing and Urban Development, HUD) recently named
Utah as the top market for real estate appreciation in the United States with a growth rate of 12%
between November 2006 and November 2007.

According to the State of Utah (Governor‟s Office of Planning and Budget), the values in the
Washington & St. George areas have held steady over the same period of time. In the second
quarter of 2005, there was a proverbial home buying frenzy in southern Utah. This drove prices
up by an unsustainable 35% on average by second quarter 2006. Demand was high and
inventories were low. Developers rushed to meet the demands of the market. By the third
quarter in 2006, home prices were at an all time high. Inventories were beginning to increase and
the impending national housing market crash came with force. Nationally, home prices and
growth based economies collapsed. Utah, particularly the Southern part of the state, has actually
sustained an overall 13% annual growth rate since 2005. This is sustainable and healthy for
emerging markets. Job growth is up. Home and land values are steady. Overall, conditions in the
area are great. However, there is currently, a surplus of inventory in the housing sector. This has
affected absorption rates and prices. Though less desirable areas are experiencing price
decreases, more desirable areas, like Villa Toscana, have held steady during this period of
adjustment. Villa Toscana is clearly one of the most desirable areas in the region.
The development plan presented in this executive summary is structured to anticipate current and
near-term slow absorption rates, and also allows for expected improvements in future market
conditions.

The following information was gathered from various sources and is deemed reliable and
accurate.

Source: Washington City General Plan (Dated March 2005)

        Median Income
        There are subtle but important differences in the average incomes reported in the Census
        for Washington City, St. George, and Washington County. Washington City‟s Median
        Household Income is $1,200 les than St. George, and $1,900 less than the County.
        With regard to Family Median Income, St. George and the County are almost equal, with
        Washington City‟s median income approximately $3,000 less. These gaps don‟t seem to
        be significant, until one realizes that they are averages for the entire number of
        households in the community.

        Washington City‟s lower Household and Family incomes may in part be a reflection of
        the lack of housing available in the past to attract higher income level residents. Recent
        and pending upscale developments in Washington City may be raising the Median
        Income levels somewhat in the future.

        The City, County, and St. George median incomes are all significantly lower than those
        of the Wasatch Front, as represented by the North Salt Lake comparisons. This difference
        could be a reflection of several factors, including the relatively large retirement segment
        of the population that is living on pensions, as well as the lack of skilled employment
        opportunities in the Washington County area. As the region continues to grow and
        regional business access improves with the new airport, it is likely that the area will be
        increasingly attractive to employers who require higher skilled employees, and incomes
        will begin to rise.
                                                                                                 12



        The chart that follows outlines the median income for Washington City
        compared to other areas in in the region and state.




Source: The Milken Institute – Best Performing Cities (2007):

        The Milken Institute “Best Performing Small Cities, 2007” ranked St. George, Utah as
        the #2 small city for job creation and retention. This ranking for St. George also indicates
        that it is one of the very best small cities in the country when it comes to overall
        economic performance. Images and text from the report follow:
13
                                   14




Source: Inc Magazine (May 2007):
15
                                                                                                    16



9. Utah State Economy & Job Market
Source: State of Utah - Governor’s Office of Planning & Budget (December 2007):




Source: Forbes Magazine (November 2007):

Although located in the northern part of the State, the following article (highlighting Salt Lake
City) add strength to the argument that Utah‟s overall economy is strong when compared to the
rest of the country.
                                                                                                17


10. Other Benefits – Washington City/St. George Region
Villa Toscana is conveniently located in Washington City, Utah and has all of the benefits of
being part of an incorporated city; water, sewer, storm drain, parks, street and right of way
maintenance all provided by the city, just to name a few. Beyond that, Villa Toscana touts the
splendor of the natural surroundings with convenient access to local shopping, recreational areas,
hospitals, and professional services. Villa Toscana is also just a short 1.5 hour drive from
fabulous Las Vegas, Nevada. Although not everyone is drawn to Las Vegas for “gaming, shows
and night life”, it remains a popular destination for world class dining, shopping, shows and
concerts. McCarran International Airport is a major hub that services major cities across the
nation and abroad. Flights to and from this airport are priced among the lowest in the nation. Yet
another reason the lifestyle Villa Toscana offers is wide ranging and diverse.

The following map provides a great overview of the natural wonder that is Southern Utah. Zion
National Park is less than 1 hour to the east of Washington City. Brian Head Ski and Summer
Resort is 1 hour to the north. Quail Creek Reservoir is less than 5 miles away. You can ride your
mountain bike or ATV from right near your home in Villa Toscana to Sand Hollow Recreation
Area and the famed “Sand Dunes”. Pine Valley is located just 45 minutes to the Northwest
offering alpine streams, equestrian trails and Pine Valley Reservoir. Washington City is as close
to Moab as any other populous place in the world. Lake Powell is a short 3 hour drive. Villa
Toscana is the virtual center of recreational activities that families and baby boomers alike will
cherish.
                                                                                               18


11. Villa Toscana Development – Overhead Views of Property
The aerial photos (below) show the boundries of the development. The reader should note that
improvements have been made to the property that are not reflected in the photos. All
improvements to date have been permitted and completed according to the municipal code. The
improvements made to the property, but not shown in the photos, are listed here for the reader‟s
information:
Phase 1 - Improvements Not Shown:

       Final Grading of all 20 Lots inluding escesary over excavation, compaction and pad
        preparation.

       All Utilities including Gas, Water, Electric, Storm Drain, Fire Hydrants and Sewer

       Curb, Gutter and Sidewalk

       Paving, Street Lights, Street Signs and Monuments.

Phase 2 - Improvements Not Shown:

       Utilities are stubbed to property phase line and beyond as needed.

       Mass Site Grading including Streets and Lots




Figure 11 - Overhead View of Property*
                                                                                                19

*Note: The blue line indicates the phase split in both photos. In the photo on the previous page,
the green boxed area indicates the 2.5 acre parcel that is under contract that will be paid for rom
proceeds of initial draw (see section 4, Exhibit A, Detail of Draws, Draw 1(a) Toscana Vista).




Figure 12 - Bird‟s Eye View of Property*

*Note: In the photo above, the grey lines are for reference, indicating the approximate location
of streets and are not to scale.
                                                                                             20


12. Villa Toscana Floor Plans & Elevations
The following floor plans and elevations of the homes planned for Villa Toscana are provided for
the reader‟s information:




Figure 13 – Floor Plan #1
                            21




Figure 14 – Floor Plan #2
                            22




Figure 15 – Floor Plan #3
                            23




Figure 16 – Floor Plan #4
                                                                                              24


13. Conclusion

Villa Toscana is a beautiful, tranquil setting designed to give its future residents the rich,
rewarding lifestyle they desire. From an investment standpoint, Villa Toscana has been planned
in such a way as to maintain strength in the changing market of today. The following table
summarizes the main points of the project, the financing being sought, and the expected proceeds
and LTV:



Review:

 Total Lots Available                                              36

 Homes to be Constructed                                           32

 Funding requirements ($)                                 $7,500,000

 Term of Loan                                                 5 years

 Total of Draws                                          $22,384,000

 Total Proceeds (at end of term)                         $22,905,000

 Average CLTV                                                    57%




*If you have any questions or need any additional information please feel free to
contact: Nelson Moak 435-229-6625                 Jared Bryant 916-983-5145
            marketwise2000@hotmail.com                      jaredbryant@yahoo.com

								
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