Project Summary

• Diversified Lending Solutions ("DLS") has been retained as the exclusive advisor to Boundless Properties (the "Sponsor") to obtain programmatic funding to complete a 3-Phase, $3.125 million planned urban development. Phase 1 of the Hulse Road Estates (the "Property") consist of the 4 homes, and the entire development will be comprised of 11 single family homes (the, "Project") located in Jonesborough, TN. The homes in Project the will each total roughly 1,900 +/- SF, and include 3 bedrooms, 2 bathrooms, and an oversized 500 +/- SF garage situated on an at least 1 acre of land. Phases 2 and 3 of the project will be comprised of four and three similarly-designed single-family homes, respectively.

The Property

• The Project will benefit from energy efficient design and high-end amenities, including a one-story floor plan preferred by 55+ purchasers. Other features will be large, unfinished daylight basements, oversized garages with work and storage space, stainless steel appliances, USB-enabled outlets throughout.
• Jonesboro, TN is centrally located between Bristol, Knoxville, and Kingsport, TN and home to East Tennessee State University, a school of 12,000 students and a major medical school and teaching hospital. The Property area is in a suburban neighborhood that offers convenient access to the corporate offices of Siemens, Eastman Chemical, American Water Heater and numerous employers in the region. Jonesboro benefits from a crime rates and unemployment rate that are below the regional and national averages, and a population that is 56% married, 73% homeowner, and a median income of $50k.

Background

• The Sponsor acquired the Property in November 2021 for $443,643 and has invested an additional $59,655K into soft costs and horizontal development. The Sponsor is already in possession of all necessary approvals and permits for vertical construction of the homes included in Phase 1, 2, and 3 of the Property. Site work at the Property has already commenced and most of the needed soft cost expenditure for the Property is already underway. The Sponsor has already paid the power board to move electric lines and put in pedestals for underground power to the homes. No roads are required because all of the lots have road frontage and all of the properties will have septic.

Business Plan

• The projected timeline is 9 to 11 months for completion of the Phase 1 vertical construction, and 18 to 21 months to complete all three phases. The Sponsor's business plan is to build each of the homes for an all-in cost of $150/SF and sell the completed homes for $263/SF. The senior loan request for Phase 1 represents 52% of total budgeted costs of $2.67 million and 49% of the completed value. Loan proceeds will be used to fund the vertical hard costs, fund an interest reserve, fund new closing costs.

Sponsor

• The Sponsorship team is comprised of experienced real estate investors in the south who have invested in over 1000 units of multifamily properties, and successfully fix and flip single family homes. The Sponsorship team also has extensive experience managing new construction projects as a principal and a third-party service provider through a principally-owned construction company. Construction experience has ranged from commercial to residential, and includes successfully development of over a dozen new construction homes throughout Tennessee and several commercial buildings.