TOTS Development Company
Ashburn CrossingLoudoun County, Virginia
Joey QiJanka Durisova Cheng Ji Doreen Liu Sherlock Zhou Zach Kayce
Summary StatementJoint Venture TOTS Development & St. John Properties
200 units – Luxury garden-style multifamily project at the corner of Loudoun County Parkway and Gloucester Parkway in Ashburn, Virginia
Expected return over 20%
Location
The Metrorail (Silver Line) will be extended into Loudoun County by 2018
Gloucester Parkway will be extended past the Redskins Park to connect with Route 28
Upcoming Silver Line and Gloucester Parkway Extension
Market Study – Ruled OutRetail - Fierce competition from One Loudoun
Office - High Vacancy Rate (16.9% - 19%)
Flex/Industrial - High Vacancy Rate (14%) Oversupply (400,000 SF under construction)
Market Study – DemographicsAccording to the 2010 Census:
Household Income Chart:
Loudoun CountyPopulation 328,533 (2012 Estimate)
Median Household Income $119,134 (#1 Ranked in USA)Household Size 3.37
Potential Renters
Market Study - Vacancy
According to Cassidy Turley Multifamily Snapshot – Fourth Qtr. 2012
Apartment rents grew at a controlled rate of 3.1% in 2012
Vacancy RateDC Metropolitan 3.9%
Loudoun County 4.2%Average Asking Rents (Loudoun) $1505
Market Study - DemandExisting competitors:
Ashburn MeadowsParc Dulles ApartmentAshboroughSaddle RidgeVillage at Potomac Falls
No new construction in our immediate market Ashburn Meadows
Saddle Ridge
Ashborough
Village at Potomac Falls
Parc Dulles Apartment
Current Year Year 5
Marginal Demand 259 475
Improvement – BudgetTotal development cost $ 38,396,050
Hard Cost
27485428.718132372%
Soft Cost
7660621.4006331120%
Land Cost3250000
8%
Improvement – Unit MixImprovements:
Total GBA : 250,025 SFTotal Net Rentable: 200,000 SFTotal Units: 200 unitsAverage Unit Size: 1,000 SF
Unit Mix:
Jr 1 BR/1 BA15%
1 BR/1 BA35%
2 BR/1 BA15%
2 BR/2 BA17%
3 BR/2 BA18%
Improvement – Details Exterior:
• 1st Floor – Concrete; 2nd & 3rd Floor – Wood• Brick & Wood Facade
Interior: • High-end interior finishes• Granite countertops, shaker inspired cabinetry, Italian porcelain tiles, chef kitchen sinks, African hickory hardwood, marble countertops in the bathrooms• Keyless entry system to enter your apartment home
Common Areas:• Clubhouse - a study area/computer lounge, fitness center, pool,
resident lounge, Wi-Fi, party room for rent
Timeline Timeline
Begin: June 2013Construction period: 24 monthsLease-up period: 12 months
Month 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29Constructi onLease-upMove- i n Stabl i zed
TeamDevelopment Team
Equity Partner Architecture
Construction Management Company Legal Consultant
Lender
Major Participants
Project Manager
Lead Engineer
Sr. Financial Analyst
Lead Architect
Sr. Developer Sr. Developer
Reversion Split 45%
Cash Flow Split After Pref 55%
Preferred Return St. John then TOTS
HUD Loan Debt
St. Johns Contribution$ 3,250,000
Return
IRR with Reversion (2022) = 20%
Sensitivity Analysis
Variables:
1- Market Rent2- Vacancy3- Cap Rate
Risk• Market Risk
Increases with potential oversupply of competitive properties with the Silver Line coming on board
• Interest Rate RiskInterest rate increases resulting in higherCapitalization Rate
• Inflation RiskOperating expenses inflate higher than rental rates
RecommendationJV with TOTS Development 10 acres at $3,250,0008 Pref – 55% Cash Flow Split – 45% Reversion SplitIRR 20% in 2022
Contact Information
TOTS Development1625 Massachusetts Avenue
Washington, DC 20002(703)-203-1128
Questions & Comments
Slides Reference1- Intro2- Summary Statement3- Location4- Metro + Route 28 Ext.5-8 – Market Study9-11- Improvements12- Timeline13- Development Team14- Return15- Sensitivity Analysis16- Risk17- Recommendation