Primos Tacos IL Refinance

George says: "This is a pretty decent hard money loan for us. The population of Aurora is 180,000; and Americans are always going to want to go out to eat Mexican food."

"Folks, Blackburne & Sons only closes about 40 loans per year. Each of you needs to move at least 20% to 30% of your portfolio out of stocks and into decent first trust deeds before the next great recession hits. It’s been 16 long years since the last crash. My point is that when you see a decent little deal like this, you should take your $10,000 to $25,000 piece. Only a limited number of trollies are coming down the track between now and the next stock market crash. Bitcoin sure looks to me like a blowoff top."

Blackburne & Sons is pleased to present this first mortgage secured by a 4,469SF restaurant on a 0.67-acre parcel, located in Aurora, Kane County, Illinois.

The purpose of this $432,000 loan is to complete a l;and contract in the amount $155,000 and to pay the borrower back for the $96,679 rehab already done to the property, and to cover closing costs.

Kane County is a county in the state of Illinois. According to the 2020 census, it had a population of 516,522; making it the fifth-most populous county in Illinois. Its county seat is Geneva, and its largest city is Aurora. Kane County is one of the collar counties of the metropolitan statistical area designated "Chicago–Naperville–Elgin, IL–IN–WI" by the US census. According to the U.S. Census Bureau, the county's area was 524 square miles, of which 520 square miles is land and 4.1 square miles (0.8%) is water. Its largest cities are along the Fox River.

The county is bordered by McHenry County (north), Cook County (east), DuPage County (east), Will County (southeast), Kendall County (south) and DeKalb County (west). Kane County has an extensive forest preserve program, with numerous nature preserves, historic sites, and trails which include Almon Underwood Prairie, Andersen Woods, Arlene Shoemaker and Aurora West. The county is also home to Aurora University, Elgin Community College, Judson University and Waubonsee Community College

Aurora is a city in northeastern Illinois and is located primarily in Kane and DuPage counties along the Fox River. It is the second-most populous city in Illinois, after Chicago, and the 144th-most populous city in the U.S. The population was 180,542 at the 2020 census. Aurora is the largest city in Illinois that is not the county seat of any county that it resides in. According to the 2021 census gazetteer files, Aurora has a total area of 45.91 square miles, of which 44.97 square miles (97.94%) is land and 0.94 square miles (2.06%) is water. While the city has traditionally been regarded as being in Kane County, Aurora also includes parts of DuPage, Kendall and Will counties. Aurora is one of only three cities in Illinois that span four counties the others being Barrington Hills and Centralia.)

In 2022, the median property value in Aurora, IL was $241,600, with a homeownership rate of 66.8%, and the median household income was $85,943. The economy of Aurora, IL employs 95.5k people. The largest industries in Aurora, IL are Manufacturing (13,865 people), Retail Trade (11,650 people), and Health Care & Social Assistance (11,074 people), and the highest paying industries are Mining, Quarrying, & Oil & Gas Extraction ($122,467), Agriculture, Forestry, Fishing & Hunting, & Mining ($104,605), and Professional, Scientific, & Technical Services ($92,282). The largest universities in Aurora, IL are Aurora University (2,274 degrees awarded in 2022).

The subject property consists of a 29,171SF rectangular shaped parcel that is generally level in topography. The subject property is in the City of Aurora, Illinois, which is located in the west suburbs and is situated north of Montgomery, east of Sugar Grove, west of Naperville and south of Batavia. The subject is situated along the west side of Highland Avenue. The immediate surrounding uses include detached single unit residences to the north, small retail properties are to the east and south, and railroad tracks and industrial uses are to the west.

The site is improved with a single story, 4,469SF restaurant building that was originally constructed in 1962. The building is equipped with a concrete slab foundation, barrel roof and stucco / concrete block exterior walls. The site has 48 parking spots and some light landscaping. The interior has ceramic and porcelain tile flooring, glass entry doors and painted wood trim. There are two forced warm air furnaces and two central air conditioning units and a fire alarm. The finished basement includes an office area and dry storage as well a large open area. There is also a small patio with gazebo in the rear of the building. The maximum allowed occupancy is 144 people.

The property features a large bar, seating areas, a gaming area, stage, commercial kitchen, dishwashing station, large walk-in cooler, and two restrooms. The property was extensively rehabbed in 2024 by our guarantor. This rehab included a complete interior renovation of the main level, including new bar, remodeled restrooms, flooring, light fixtures, stage, new furnaces, and updated kitchen. Per our borrower, approximately $96,679 was spent on the completed improvements.

The borrower is a single man who will hold title to the property through a corporation, of which he is the sole owner and President. He will be providing a personal guarantee on our loan. The entity that will hold title to the property does not report any income. The operating entity runs the Mexican restaurant out of the subject property currently. It reported a net business income of $496,170 in 2023 and $55,380 in 2022.

Our guarantor works as the restaurant manager / owner. He self-reported a net worth of $3,865,000 and has a mid-credit score of 534. He shows an adjusted gross income of $581,666 in 2023 and $268,175 in 2022. For January through August of 2024, the business income is $99,431.46. A letter of explanation for this income drop will be provided in the due diligence file.

The borrower has been operating his business in the subject property since 2021 and will use our loan to satisfy the land contract in the amount $155,000.

We hired an MAI appraiser who valued this property with an appraised value of $835,000 (AS-IS).

We hired a broker who performed a drive-by opinion of value (BPO) and valued this property at $665,000.

At an 11.0% yield to investors and a 51.7% LTV (AS-IS) appraised value, this appears to be a reasonable investment. Investing in any first trust deed 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. Foreclosed commercial properties almost always need to be renovated before they can be leased or sold, so be sure to maintain some liquidity.

ACCREDITATION STANDARDS

Please note this offering is a SEC Regulation D filing and will be done through a Private Placement Memorandum. In order to invest, you must be an accredited investor. Generally speaking, an accredited investor is an individual:

(a) whose individual income exceeds $200,000 in each of the past two years, with reasonable expectation of reaching the same going forward OR
(b) whose joint income with spouse exceeds $300,000 in each of the past two years OR
(c) your NET WORTH exceeds $1,000,000 (exclusive of your primary residence) OR

If you plan on investing through an entity, the entity can qualify if ANY of the following are met:

(a) all equity owners must be accredited OR
(b) any trust with more than $5,000,000 in assets OR
(c) ERISA with either $5,000,000 in assets OR a bank, insurance company, or registered investment advisor as it's trustee OR
(d) any self directed ERISA with an accredited investor(s) making the business decisions OR
(e) an IRA owned by an accredited investor

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.
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.
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.
You can also buy some of our smaller deals in their entirety, but I only recommend this if you are richer than Crassus.
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.
During the S&L Crisis, commercial real estate fell by 45%. Within three years, values reached new highs. During the Dot-Com Meltdown, commercial real estate fell by 45%. Within three years, values reached new highs. During the Great Recession, commercial real estate fell by 45%. Within three years, values reached new highs. Some time in the next decade, we will have another opportunity to snatch up prime commercial real estate at a huge discount. You will be terrified, but when Blackburne and Sons invites you to join a syndicate to buy a nice commercial property at a 35% discount off its prior high, just remember that the best time to invest is when blood is running in the streets. Why not when real estate has fallen by 45%? You’ll never catch the very bottom because historically the bounces off the bottom happen much too fast. Bounce-soar. You will be terrified, but just remember that the best time to invest is when blood is running in the streets.

Blackburne & Sons Realty Capital Corporation--For more information, contact Tom Blackburne
555 University Ave., Suite 150, Sacramento, CA 95825
Telephone: (916) 338-3232 * Fax: (916) 338-2328
Real Estate Broker -- California Department of Real Estate -- License Number 829677 -- NMLS Number 103430
Publicly advertised to California residents only under California Department of Business Oversight business plan permit.
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