Borrower has invested $450K “skin in game” in full renovation and remodel since purchase of property in 2019. In addition to this income generating hotel property, borrower owns a successful Harley Davidson restoration company. Borrower able to make payments through multiple financial sources.
Successful business owner and real estate investor sought a $337,500 1st Trust Deed cash out refinance loan on this fully renovated and remodeled commercial hotel building known as “Old Sierra City Hotel” just two blocks from the world-famous Pacific Crest Trailhead, Yuba River and located in the picturesque Sierra Nevada region, 40 miles northwest of Lake Tahoe. in Sierra City, Sierra County, CA. The purpose of this loan is to refinance out of an existing, and in good standing 1st TD $222K that is maturing, 6 Months prepaid investor interest and the balance of approximately $70K in cash out will be re-invested into the business’ online and social marketing efforts, hotel/restaurant staffing to support subject property’s popularity and growth.
The borrower has approximately $450K personal “skin in game” between down payment on original purchase of subject property then self-financed renovation/remodeling work completed. In addition to the subject property known as “Old Sierra City Hotel” Old Sierra City Hotel, borrower owns a successful Harley Davidson motorcycle restoration business called DC Choppers DC Choppers (dc-choppers.com). Exit Strategy: conventional or SBA refinance.
The subject property is a fully renovated and remodeled, cozy, historic, 3 story, “Tahoe style” Hotel building with a restaurant and bar. The subject property building is comprised of 6,000 rentable SF, sitting on two parcels amounting to a total of 7,841 SF. The subject property has a total of 12 rooms. 10 rooms are used for overnight stays, 8 bathroom and on the lower floor is the restaurant, bar, pool tables, dining/event room, a commercial kitchen and two ADA restrooms. The subject property features guest outdoor seating with covered patios on the entrance deck and the 2nd level floor. In addition, subject property includes a detached 600 SF garage-warehouse building with a 10 x 8 feet metal roll up door on adjacent parcel from hotel building.
The subject property was designated a Historic building in 1992 and it is located on the popular midway point of the Pacific Crest Trail that tourists and hikers, domestically and internationally, frequent. The Pacific Crest Trail goes from Mexico through State of California and up to Canada. The subject property sits on the main intersection of downtown Sierra City, just across from the city’s post office and main general store. The subject property is on State Hwy 49 near many hiking, equestrian and biking trails as well as the Yuba River for swimming and river rafting for the summer months and local cross country skiing during winter months.
There is a full-time, onsite, hospitality experienced General Manager running sales/operations. The hotel is averaging $10K monthly income. The newly renovated restaurant is opening soon with income projections of another $10K income earning potential for a total of $20K monthly revenue. Borrower “gutted it out” during COVID and used that time to fully renovate and remodel hotel. Borrower financially invested in property and believes it’s well positioned for success with hotel sales and new restaurant. Exit strategy: conventional and SBA refinance within 24 months. We made several improvements and updates not limited to the following: Interior and exterior paint Repaired and updated septic system Repaired and updated electrical systems. Installed new fixtures, toilets, showers in most rooms. Replaced hot water heater. Replace heating system. Replaced doors and windows. Redecorated entire facility.
What we like about this Trust Deed opportunity:
- Fully renovated/remodeled hotel and restaurant – Borrower $450K “skin in game”
- LTV: 50.00% / Net LTV 46.62%
- 12.00% Investor Rate
- Net Investor Equity Protection: $360,282
- Busy tourist location on the world-famous Pacific Crest Trail and Yuba River
$400,000 1st TD @ 11.50%, 59.26% LTV, Commercial Hotel, $40,000, Min Inv., Sierra City, CA
