Tommy and Katia review a luxury spec house that originally needed $1 million to build a $5-7 million mansion. The first developer fell through on due diligence, but another investor, Deanna, stepped in and bought it instead. They walk through the $1.9 million purchase price, construction budget, and 12-15 month exit timeline.
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It was a brand new luxury house development build, and we were going to raise funds on it for a guy to build the house there. He wanted us to raise him $1 million and then they were going to build a, like a $5 or $7 million mansion on it. And so we were trying to work the deal with the guy, but he never got back to us with all the due diligence stuff we needed from him. And deal slipped through. Well, last week during the podcast, during the webinar virtual summit, one of the people on stage, Deanna, actually bought that guy's deal ahead of him. And then told us about it and needs us to raise the capital. So like we didn't lose the deal. We just lost, we just switched buyers. We switched and it was crazy how small world, they're both Canadian. You're totally not enthused with this at all.
No, I'm, I'm looking for, did you already like run Cortez on here? Is it this one? Got it. Okay. Like I went through, so here's another thing to learn over here. You can actually rename these. And this makes a huge difference so that when you're like, we'll just call this Cortez. So, and then like I renamed a few of them because we were going through them over the weekend just to make life easier. So anyways, when that happens, it just makes a big difference.
Right. So if you go up to the top here, you'll see what I did was I put the documents in and explained it. Are you up at the show?
I'm at the top.
Oh, well, I put the documents in below this. So, all right. So what can you walk through these real quick? I got a couple of things going on right now.
So this is the projects. We have the operating agreement, the debt, the subscription agreements, the overall budget, and then the PM. So when it goes through, but it's going through Titan 23 fund, which means that on the back end of this, It's got my PPM and all the things and the criteria. So now it's going through helping analyze through the filter of my fund Titan 23. So current deal, the purchase price, $1.9 million. Estimated ARV. What's ARV? Come on. What's ARV? After repair value. After repair value. There we go. Construction budget. And then the exit timeline, 12 to 15 months. So it's build and sell a luxury spec residence. What that means, Katia, a spec residence? No, I'm not sure what that is. So they can ask Deal Hunter, but—
start with what is the full word? What is the full word?
Spec is short for specifications, speculation.
So spec is speculation. Okay. Speculation is that I'm going to build this house and I speculate that I'm going to sell it.
Gonna guess.
So I'm guessing I'm gonna sell. I speculate I'm gonna sell it.
So the hard and soft construction cost, $2.5 million.
