Experienced real estate developer and investor sought a business purpose cash-out 1st TD on this non-owner occupied, vacant land in Penn Valley, CA. Funds from our loan were used to payoff a small existing 127k 1st TD. Additional cash-out will be applied to the development of Retirement & Affordable Housing units on this subject property by his company https://steelheartinternational.com which has a history of specializing in small home construction. The borrower was able to purchase the land at a distressed value last year and has since successfully lobbied to be recognized & included in the City’s new Master Plan as the “Village Core”.
The subject property is 20.1 acres of vacant land. The subject property is located in Nevada County which is experiencing a significant population growth because it’s located within a desirable, commutable distance from Sacramento while providing an affordable, small town atmosphere. The subject property sits in the picturesque rolling hills of the Sierra Nevada’s, close to rural shopping centers and nearby schools; as well as, many popular tourist and recreational locations such as Lake Tahoe, Truckee River & Yuba River. The subject property is on Highway 20 which connects just 5 miles to Highway 49, the major transportation artery to larger cities. The borrower is in the process of receiving entitlements for this subject property to be re-zoned from its current “R2” residential zoning to commercial/mixed use for this City Center and Retirement & Affordable Housing build. The current Appraisal of $1.26 Mil. is based on the current R2 zoning which allows 6 units per acre. Any increase in Zoning or Entitlement density would add additional value to the Appraised amount.
What we like about this Trust Deed opportunity:
- 13.00% annualized return
- 34.99% LTV / 32.37% Net LTV
- 6 months guaranteed interest
- 6 months prepaid interest
- Small Home, Rural Retirement & Affordable Housing trend, increased consumer demand