We Have Raised the Rate By 1%, and George Now Likes the Deal a Lot
$251,500 REMAINING!


Exhibit B -- Specifics of the Loan

Non-California Residents
Must Purchase the Entire Loan

Image 2

Loan Number: N2496
Loan Amount: $350,000
Minimum Investment: $20,000
Call for availability of smaller participations
Type: First Mortgage
Yield: 9.0%*

Important Links:
How to Invest in This Loan
Suitability Requirements
Offering Circular
Loan Servicing Agreement
Audited Financial Statement for B & S
Inventory of Available Loans
To Be Added to Our Investor Email List


PROPERTY

Project: Miami Gardens Warehouse Condominium
Property Address
: 4710 NW 165 Street Miami Gardens, FL 33014
Description:
The subject property consists of a 4,920SF one story, front loaded, ground level office/warehouse condominium located in a complex of additional units in Miami Gardens, Florida.

For an aerial view of this property...Click Here!
For a street view of this property...Click Here!

Image 2



Image 2

TERMS

Term of Investment
60 months
Current Interest Rate
9.0%
Repayment Schedule
30 Year Amortization
Monthly Payment
$2,752.55*
Purchase Price of the Note
$350,000
Current Balance on the Note
$350,000
Maturity Date
60 months
Balloon Pymt. after 60 months app.
$343,191.50
Late Charge Amount
$330.67**
Prepayment Penalty
None

*Net of servicing
**To be shared equally with B&S


EQUITY ANALYSIS

Appraised Value - December 21, 2018
$640,000
Protective Equity
$290,000
Loan-to-value - Appraisal
55.0%


OPERATING STATEMENT

INCOME
Rental Income
$56,580
Less 6.0% Vacancy Allowance
$3,395
Effective Gross Income:
$53,185
   
EXPENSES
.
Management Offsite (5%)
$2,659
Taxes
$11,426
HOA
$7,872
Miscellaneous
$738
Legal & Audit
$738
Total Expenses
$23,433
 
NET OPERATING INCOME
$29,752
Note: Pro forma based on appraiser's estimates

BORROWERS

Name(s)
Individual
His Occupation
CPA
2016 Income
$114,038
2017 Income
$119,766
Percent of Ownership
100%

Earn a $250 Referral Fee 
Refer accredited trust deed investors
for our mailing list.


To invest, please call Angela Vannucci
at 1-800-606-3232 or CLICK HERE.


MIAMI GARDENS WAREHOUSE CONDOMINIUM

George says,"I have just figured out that I like this loan a lot.  It is now a whopping 9% loan (we just increased the rate by 1%) to a CPA with a good income and a mid-credit score of 772.   Over the years I have made it clear that I hate church deals.   My initial opinion of this deal was therefore pretty lukewarm.   Actual church buildings are difficult to sell and and near-impossible to lease.   I also missed the fact that our borrower makes a handsome income outside of the church.  My staff, however, has reminded me that our borrower has a good income outside of the church and that collateral is a nice industrial condominium.  The good thing about industrial condominiums is that the exterior of the building and the grounds are maintained by the condominium association.   At this 1% higher rate, I now think this loan is an excellent risk-return tradeoff."

Blackburne & Sons is pleased to present this new first mortgage secured by 4,920SF, one-story office/warehouse condominium located in Miami Gardens, Florida. Borrower is a CPA with a 772 mid-credit score. The purpose of this loan is to pay in full the matured loan secured by the subject property. More details on borrower and property below.

Miami-Dade County is in the south-eastern most part of the U.S. state of Florida. According to the 2017 census report, the county had a population of 2,751,796, making it the most populous county in Florida and the seventh-most populous county in the United States. It is also Florida's third largest county in terms of land area, with 1,946 square miles. The county seat is Miami, which is the principal city in South Florida.  This county is one of the three counties in South Florida that make up the Miami metropolitan area, home to an estimated 6,158,824 people in 2017, as well 34 incorporated cities and many unincorporated areas. The northern, central and eastern portions of the county are heavily urbanized with many high-rise buildings along the coastline, including South Florida's central business district, Downtown Miami.

The subject property is located in the City of Miami Gardens. With a population of 111,875, this city encompasses a total of approximately 22 square miles and is considered a blue-collar, middle class community. The Dolphins Stadium (recently renovated in 2016) and Calder Race Track are located here. Florida Memorial University also call Miami Gardens home, with 1,600 students and aviation as its centerpiece. This university is one of the nation’s only Cessna training center.

As for the neighborhood surrounding the subject property, the character of the neighborhood is light-industrial in nature, considered average quality and in the redevelopment stage. Growth at this time is reportedly slow, with fair development potential due to the lack of vacant developable land. The Miami Gardens Police Department headquarters is located in the Sunshine State Industrial Park, three miles east of the subject site. Common property types surrounding the subject are warehouses, light manufacturing plants, cold storage plants, and combination wholesale/retail warehouses and office warehouses built between 1957 and 1985.

The subject property itself is located in an industrial complex that consists of three adjacent, one story, office / warehouse condominium buildings; total square foot of buildings is 95,717SF. The buildings were constructed in 1979, then converted from a rental warehouse to industrial condominiums in March of 2007. The land-to-building ratio for the subject property is 2.46 to 1. There are a total of 16 units of various sizes; units range from bare shells with no build-out, to 38% build-out. The buildings have recently been painted and have new decorative overhang entries. Each unit has at least one overhead loading door and a pedestrian door. The units have a clear ceiling height which averages 18’ to the bottom of the twin-T extrusion. Each unit has at least one restroom and the buildings are equipped with fire sprinklers.

The security of this loan will be one 4,920SF condominium, of which 907SF is office space. The office space has vinyl tile and carpeted floors, painted drywall, acoustic ceilings with recessed fluorescent lighting and central air conditioning. Two restrooms are located at the east end of the office area. The office space includes a waiting room, reception area and two private offices. The warehouse area is air conditioned, with exposed flexible duct work.  The subject has two overhead loading doors and a clear ceiling height of 19’ to the bottom of the twin-t extrusion. The subject is considered to be in average condition for the area, with no recommended repairs noted.

Presently, the subject property is owned by Herald of Harvest Ministries Apostolic Faith Incorporated. This church was operated by the borrower’s father, who purchased the subject in November of 2007 for $680,000. After the passing of the borrower’s father in 2014, our borrower took over operations. The church filed for Chapter 11 bankruptcy protection in 2016 to avoid foreclosure due to the Note’s maturity, and inability to obtain new financing. The bankruptcy was dismissed on April 30, 2019 to allow for the borrower to take title to the property personally, and pay off the existing Note that has matured. The church will remain as a tenant in the property after transfer of title. Our borrower now runs the ministry, which reported a 2018 net income of $28,012 and $20,212 for 2017 after adding back mortgage interest. The church will be leasing back the property for a monthly rental rate of $3,046 NNN.

Our borrower is a married man, who will be holding title to the property as an individual. He has a mid-credit score of 772, with a stated net worth is $846,510. Taxable income for 2017 and 2016 was $119,766 and $114,038, respectively, all from his employment as a supervising CPA at Kaufman Rossin (CPA firm).  His wife will not be on title due to poor credit and that she is a full-time student.

We engaged a local MAI appraiser who valued this property at $640,000. We also engaged a local broker who performed an opinion of value, and valued this property at $435,000.

At an 9.0% yield to the investors and a 55.0% LTV, this appears to be a reasonable investment. Investing in any first mortgage involves substantial risk, so be sure to read the Risk Factors section of the Offering Circular carefully before investing. A large and prolonged decline in real estate values is possible. Be sure to read the Risk Factors section of the Offering Circular carefully before investing. Foreclosed commercial properties almost always need to be renovated before they can be leased or sold, so be sure to maintain some liquidity.

George’s Advice For Successful First Mortgage Investing

  1. You should spread your mortgage investment portfolio out among lots of different deals. If you have $300,000 to invest, you should invest $10,000 to $20,000 in 15 to 20 different fractionalized first trust deeds. For example, if the deal is a $300,000 first trust deed on an office building in Boise, with a $15,000 investment you would own 5% of the loan. By spreading your money out into a bunch of different deals, you are achieving the diversity of a fund without the failed fund sponsor problem. If you are extremely wealthy, you could double (or even triple) my suggested investment amounts, but be careful about pouring too much money into a single deal. We once had a whole building fall into an old coal mine. Ouch.

  2. Be wise and resist investing in any first trust deed yielding more than 9%. I would personally never invest in a first trust deed with a double-digit yield. The payments slowly grind the borrowers into the dust.

  3. Blackburne’s Law theorizes that a portfolio of 8% and 9% first trust deeds will outperform a portfolio of 11% and 12% first trust deeds over a seven-year term. Only our wisest (and eventually the happiest) investors listen to me.

  4. You can also buy some of our smaller deals in their entirety, but I only recommend this if you are richer than Crassus.

  5. It is very easy to lose money in hard money first mortgages, so fight-fight-fight against the temptation to invest in high-yield deals. As Nancy Reagan used to say, “Just say no.” But if you choose 7% to 9% first mortgages, I predict that you will be very, very pleased. 

Earn a $250 Referral Fee 
Refer accredited trust deed investors
for our mailing list.


To invest, please call Angela Vannucci
at 1-800-606-3232 or CLICK HERE.


Blackburne & Sons Realty Capital Corporation--For more information, contact Angela Vannucci
4811 Chippendale Drive, Suite 101, Sacramento, CA 95841
Telephone: (916) 338-3232 * Fax: (916) 338-2328
Real Estate Broker -- California Bureau of Real Estate -- License Number 829677 -- NMLS Number 103430
Publicly advertised to California residents only under California Department of Business Oversight business plan permit.
Return to C-Loans Home Page | Return to Blackburne & Sons Home Page
Copyright © 2018 Blackburne & Sons Realty Capital Corporation. All rights reserved. (800) 606-3232