1. Madison Realty Equities, LLC Track Record – Examples
The following are examples of properties that Madison and its principals have
managed over the past twenty years.
Slate Creek Senior Apartments in Effingham, Illinois
Since 1996, Madison has been the general partner, asset manager and property manager
for this 113-unit senior apartment property. Madison has been able to maintain 99%
occupancy of the property for the past 15 years and has caused the refinancing of the
property two times since 1996 and has returned over 200% of the investors original
$1,500,000 of equity capital. Annual cash flows remain 8% each year on the original
equity invested.
Otsego Senior Housing Partners in Michigan
Madison has been the general partner, asset manager and property manager for this 120unit senior apartment property since 1996. Madison has been able to maintain 99%
occupancy of the property for the past 15 years and refinanced the property in 2005
which returned 120% of the investors original $1,200,000 of equity capital. Cash flows
have been 8% each year on the original investment.
Denair Senior Apartments in Turlock, California
Since 1997, Madison has been general partner, asset manager and property manager for
this 70-unit senior apartment property and has been able to maintain a 98% occupancy at
the property for the past 14 years. Madison refinanced the property in 2002 and 2008.
As a result, the investors received over 150% of their original invested equity through
refinancing proceeds and annual cash flows are 9% on the original equity.
Arbors Senior Living in San Diego, California
This property is a 96-unit senior assisted living
and memory care apartment facility and is subject
to a 15 year master lease by an affiliate of
Madison. Since its acquisition in 2008, the
operation has maintained an average occupancy
rate of 95% and a 7% cash flow to investors and
there is land for a future expansion.
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2. You Secure RV & Self Storage in Nashville, Tennessee
This facility is a 520-unit self storage and RV storage. We purchased 5.4 acres of land in
1998 and designed and developed the self storage facility on the land. The property was
financed with a bank loan of $2,500,000 and capital equity investment capital of
$1,200,000. Madison continues to provide management services for the property and the
investors are receiving an annual 8% cash return.
Park Club Townhomes in Westerville (Columbus), Ohio
Since 1989 to the present, Madison has been the manager, general partner, property
manager and asset manager for this property, a luxury apartment rental community. A
limited partnership built 372 condominiums on the site in 1988. In 1989, Madison
purchased the unsold units, and redeveloped the property as a luxury apartment property
for lease. Our investor group paid $30,000 per unit (the units were recently appraised for
$90,000 per unit). Our partnership paid $12,500,000 for the property with mortgage debt
of $9,500,000 and equity capital of $3,000,000. Madison has caused the property to be
refinanced with replacement debt twice since 1989. Each time the equity distributed out
to the investors has been more than 100% of their original capital. In addition, the
investors have received and continue to receive annual 8% cash flow distributions as well
as allocations of tax loses to shelter their other investment income.
Williamsburg Square in Columbus, Ohio
Since 1991 to the present, Madison has been the asset manager and general partner for
Williamsburg Square, an apartment rental community of 384 apartments near Columbus,
Ohio. Madison assumed the general partner and asset manager role and has refinanced
the loan which has returned to the investors, 100% of their original capital and an annual
8% cash flow on their original equity amount.
Lakeview Square Townhomes in Dublin, Ohio
Since 1989 to the present, Madison has been the
manager, general partner, property manager and
asset manager for Lakeview Square Townhomes,
a luxury apartment rental community located in
Dublin Ohio. Investors built 470 townhouse
condominiums on the site in 1988. In 1989,
Madison purchased the unsold project, and
redeveloped the property as a luxury apartment
property for lease by the rental tenants. The
partnership paid $30,000 per unit (the units were
recently appraised for $90,000 per unit with the appraisal based on a rental rather than
condominiums). The partnership paid $17,500,000 for the property with mortgage debt
of $13,500,000 and equity capital of $4,000,000. Madison caused the property to be
refinanced with replacement debt twice since 1989. Each time the equity distributed out
to the investors has been more than 100% of their original capital. In addition, the
investors have received and continue to receive 7-9% annual cash flow distributions as
well as allocations of tax loses to shelter their other investment income.
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3. Assisted Living 51 in Phoenix, Arizona
In 2008, we took over the management of a 90 bed
assisted living seniors property in Phoenix, Arizona.
In addition to refurbishing the common areas
including the entrance and dining area, we
developed a revised operating and market plan. As
a result, we doubled the number of memory care
beds from 30 to 60 beds. This increased the
occupancy and increased rents increasing the
monthly income by $180,000 and the value of the
property by $2,000,000.
Victor Valley Mortgage Investors, in Victorville/Hesperia, California
In 1996, we formed a real estate investment company wherein we raised $3,000,000 of
equity to purchase a 66 acre land banking property in Victorville/Hesperia, California for
$40,000 per acre. Initially, the property was zoned by the city of for development as
single family suburban homes. In 1997-99, we designed and obtained approval from the
city for a new development plan for the entire site with revised zoning for 23 acres of the
tract to multi-family apartments. In 2001, we caused the partnership to sell the re-zoned
apartment land to an apartment builder for a price of $2,200,000. This activity generated
a gross profit of $1,280,000 to the investors for this parcel alone.
In 1999 and 2000, we re-zoned the remaining portion of the Victor Valley site (43 acres)
and we obtained a conditional use permit for single family development which increased
the density from four lots to the acre to six lots to the acre. We then caused the limited
partnership to sell the 43 acres with the conditional use permit to a home builder for
$9,000 per lot or $2,300,000, net of costs. The $2,300,000 value was all profit to the
investors.
Stonebrook Estates in Apple Valley, California
In 1998, we purchased a 94 acre parcel of land in
Apple Valley, California where we developed a
revised development plan and obtained a
conditional use permit to create a gated
community of luxury single family homes known
as Stonebrook Estates.
We completed the
development entitlements to the land and we
formed a joint venture with a local home builder
and contributed the 140 home lots to the joint
venture. The builder built the homes, sold them and in 2002 the joint venture was
liquidated and our investors made a net profit of $2,100,000 more than doubling their
investment.
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4. Riverside Center Commerce Park II in Hesperia, California
In 1997, we formed Riverside Center Commerce Park II, which purchased a 49 acre site
of land in Hesperia, California. The purchase price was $3,700,000 or approximately
$75,000 per acre. When the partnership purchased the property, it was zoned for
commercial/office space. In 1999, we obtained approval and a permit from the city to
revise the development plan and we obtained a permit to build a recreational vehicle and
self storage facility on 11 of the 49 acres near the back of the site. This facility was built
and has 680 self storage units and 104 spaces to store boats, cars and vehicles. The
recreational vehicle and self storage facility has operated since 2000 and generated
approximately $650,000 of income increasing the value of the property and the site by
$3,500,000 and giving annual 10% cash flows to investors. We are presently negotiating
with WalMart to purchase the 20 acres to build a new super retail property. The
remaining 13 acres will be developed as retail commercial center and will include a
senior assisted living apartment.
Grissom Road Self Storage in San Antonio, Texas
In 2007, we purchased and took over management of Grissom
Road Self Storage, an existing self storage facility consisting
of 265 self storage units and undeveloped excess adjacent
land in San Antonio, Texas. The excess land consisted of
approximately 13 acres of land zoned commercial. To take
advantage of local market conditions and fill a market
shortage, we added 275 parking spaces for boats and vehicles.
We also added 40 new storage units. We reduced the property
taxes with an appeal and these actions increased the annual
net income from $220,000 to $465,000 and increased the
value of the property from $2,600,000 to $5,500,000 while
cash flows were 20% by the third year.
Wolf Creek Development Phase Two, LLC in Raleigh, North Carolina
In 2006, we formed Wolf Creek Development Phase Two, LLC which purchased 23
acres of land in Raleigh, North Carolina. The property was zoned for student housing
apartments and during 2006 and early 2007, we redesigned the property to provide
student apartments for 648 suites. Each of the suites are fully furnished and the facility
provided many social and sports amenities for the residents. The construction was
completed in late 2008. During 2009 and 2010, our management company pursed a
marketing plan and leased the facility. We are now managing the facility for the
investors who invested $8,500,000 of equity. While there was no cash flow during
construction and lease up, the property now generates an annual 10% cash return to
investors.
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5. Magnolia Gardens in Riverside, California
In 2004, we acquired development land zoned for
48 market rate apartments located in Riverside,
California. We redeveloped the parcel of land
and obtained a conditional use permit which
allowed the partnership to build an 86 unit three
story senior housing apartment property called
Magnolia Gardens. We funded the construction
with a $7,500,000 construction loan and raised
$2,100,000 of equity.
The property was
constructed in 2005 and leased up in 2006. In
2007, at the end of the construction and lease up effort, the partnership sold the property.
The sale returned the $2,100,000 of investor equity and gave the investors an additional
$3,500,000 of net profit within 36 months.
Silo Self Storage in Nashville, Tennessee.
In 1999, an entity sponsored and managed by Madison purchased a 7.8 acres of land and
built a self storage property in Nashville, Tennessee for $3,600,000. We doubled the size
of the property using construction financing to build phase two and three which increased
the investor equity from $1,200,000 to $ 2,100,000. We sold the property for a $900,000
profit in 2006.
We note that certain properties enjoy a higher increase in value or different
rate of growth in net operating profit. It should be noted that each property
has its own unique risks and potential. This track record is related only to
those properties we have cited above and numbers are approximate and are in
U.S. dollars.
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