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    1. 2. <ul><li>Reasons to Invest </li></ul><ul><li>Summary of Opportunity </li></ul><ul><li>About The Firm </li></ul><ul><li>Bios of Key Team Members </li></ul><ul><li>Investment Strategy I: Short Term Lending </li></ul><ul><li>Investment Strategy II: Long Term Lending </li></ul><ul><li>Strategic Differentiators </li></ul><ul><li>Risk Mitigators I: Short Term Lending </li></ul><ul><li>Risk Mitigators II: Long Term Lending Summary </li></ul><ul><li>Predecessor Fund </li></ul><ul><li>Achieving Our Goals </li></ul><ul><li>Fund Terms </li></ul><ul><li>Summary </li></ul><ul><li>Contact Information </li></ul>
    2. 3. <ul><li>Extensive background in real estate acquisition and finance funds: </li></ul><ul><ul><ul><li>East Bay Equity Investors #1, LLC, April 2004 to December 2007, $1.6m AUM, returned 38% net of fees; </li></ul></ul></ul><ul><ul><ul><li>East Bay Equity Investors No. 2, LLC, August 2004 to December 2008, $1.5m AUM, 18% net of fees; </li></ul></ul></ul><ul><li>Formed and managed several real estate acquisition and finance funds, including East Bay Equity Investors #1 and East Bay Equity Investors No. 2. </li></ul><ul><ul><ul><li>Combined $3m AUM </li></ul></ul></ul><ul><ul><ul><li>Returned average 38% net of fees since 2004; </li></ul></ul></ul><ul><li>Co-founded NorCal Rehab Funding LLC, an ABL fund where he is currently Chief Investment Strategist and Manager in Charge of Lending Operations; </li></ul><ul><li>Graduate of the University of Southern California (Management). </li></ul><ul><li>24 years Sales and Business Development experience; </li></ul><ul><li>Licensed Loan Officer, Realtor, Mortgage Broker; </li></ul><ul><li>Founder/Broker Bluestar Financing, Inc. Rated #1 Independent Broker for investor loans in Contra Costa County, 2006; </li></ul><ul><li>Will serve as Fund Manager in Charge of Day-to-Day Operations, Chief Investment Strategist for RFS </li></ul>John Taylor
    3. 4. <ul><li>Began real estate career as full-time investor in 1998. Built extensive portfolio of multi-family units; </li></ul><ul><li>Founder of Wealth Classes, a nationally franchised real estate education company; </li></ul><ul><li>Began real estate career as full-time investor in 1998. Built extensive portfolio of multi-family units; </li></ul><ul><li>Founder of Wealth Classes, a nationally franchised real estate education company; </li></ul><ul><li>President and Co-Founder of The National Wealth Network, the largest Real Estate Investment Association in San Francisco; </li></ul><ul><li>National Speaker and recognized authority on investing in trust deeds and apartment buildings; </li></ul><ul><li>Co-founded NorCal Rehab Funding LLC, an ABL fund where he is currently Director of Major Business Relations; </li></ul><ul><li>Graduate of the University of California, Davis, B.S. in Engineering; </li></ul><ul><li>10 years experience in software development positions with Microsoft, Intuit and Virage; </li></ul><ul><li>Will serve as Director of Major Business Relations Division for Fund. </li></ul>George Antone
    4. 5. <ul><li>Independent Facilitator for commodity and financial transactions for private equity firms and high net worth individuals (transaction size from $10m to $5b); </li></ul><ul><li>Facilitates funding for bulk REO acquisitions, bank instruments and commodities; </li></ul><ul><li>Joined Management Team for NorCal Rehab Funding, LLC, in 2007; </li></ul><ul><li>Executive Director of a HUD sponsored 501c3 Housing Center; </li></ul><ul><li>Graduated in 1983 from Arizona State University with a B.S. in Accounting and a Masters in Taxation at Golden Gate University, CA. </li></ul><ul><li>Corporate tax accountant of 23 years; </li></ul><ul><li>Worked as an International Tax Analyst for Chevron Corporation before retiring to pursue real estate and finance investments full time; </li></ul><ul><li>Will coordinate with Major Business Division to analyze large ($3m+) deals and facilitate REO package investments; </li></ul>Laura Keller
    5. 6. <ul><li>NorCal Rehab Funding, LLC </li></ul><ul><ul><li>Asset Based Lending Fund, $2.3m AUM </li></ul></ul><ul><ul><li>Established May 2006 </li></ul></ul><ul><ul><li>Period: 2+ years </li></ul></ul><ul><ul><li>Return: 10.02% historic, net of fees </li></ul></ul><ul><ul><li>Returns achieved with use of leverage, SAMs, in-house take-out financing or limited lending geography </li></ul></ul><ul><ul><li>Managed by John Taylor, George Antone, Laura Keller </li></ul></ul>
    6. 7. <ul><li>Residential Funding Solutions and its GP Provide Unparalleled Transparency, Compliance and Accountability: </li></ul><ul><li>Quarterly and Annual Fund Reports Include Trust Account Status, Reconciliation & Balances, ERISA Membership Reports, Collateral/Underlying Loan Report, Mortgage Pool Statements, Partner Statements, Lender Statement of Account, Lender Investment Profile, Late Reports, Servicing Statistical Profile, Payment Projections; </li></ul><ul><li>Quarterly and Annual Financial Reports and Annual Financial Audit prepared by third-party accounting firm of Sterck, Kullick O’Neal; </li></ul><ul><li>Quarterly Newsletter detailing all Fund developments prepared by Fund Manager; </li></ul><ul><li>John Taylor, Fund Manager & Broker of Record (DRE License #01784703) compliant with all Threshold Lender regulations – reports available online; </li></ul><ul><li>94%+ of all capital secured by trust deeds - all trust deeds written by Fund available online or at County Recorder’s Office. </li></ul>
    7. 8. <ul><li>Our Focus: The Financing of Distressed, Non-Owner Occupied, Single Family Residential Income Properties in Targeted Counties Throughout California: </li></ul><ul><li>Properties: </li></ul><ul><ul><li>Over 400,000 bank owned SFRs in the state, will increase by 16% in 2010; </li></ul></ul><ul><ul><li>Additional distressed properties include pre-foreclosures, tax defaults, short sales, structural and cosmetic deficiencies; </li></ul></ul><ul><li>Geography: </li></ul><ul><ul><li>SFRs can cash flow in California for first time in three decades; </li></ul></ul><ul><ul><li>CA property values and overall economy appreciate faster than U.S.; </li></ul></ul><ul><li>Demographic: </li></ul><ul><ul><li>To chose lending areas, Fund analyzes empirical data on Population Stability & Growth, Job Growth, Household Income, Asking Rents, Vacancy Rates, Inventory, Foreclosure Rates and Home Price Affordability. </li></ul></ul>
    8. 9. <ul><li>Our Mission: </li></ul><ul><li>Provide Safety, Transparency and Solid Returns </li></ul><ul><li>For Our Real Estate Funds’ Investors. </li></ul><ul><li>Managing Partners have decades of combined experience in Asset Based Lending (ABL), Acquisition and Improvement Lending (A&I), Single Family Residential (SFR) & Multi-Family Rehab, Mortgage Brokering & Banking and Private Equity; </li></ul><ul><li>Predecessor Fund, NorCal Rehab Funding, LLC , returned 10.02% IRR net of fees with $2.3m AUM between October 2006 and October 2008; </li></ul><ul><li>GP has instituted significant changes in strategy for the new fund to integrate lessons learned from Predecessor Fund and to meet current market challenges. </li></ul>NorCal Capital Management, Inc, General Partner
    9. 10. <ul><li>Asset Based Lending (ABL) Fund providing turn-key financing solutions to niche market of “buy & hold” borrowers for purchase of distressed, 1-4 unit, residential income properties throughout California; </li></ul><ul><li>Loan products feature both debt and equity financing; </li></ul><ul><li>Unique underwriting and asset valuation process ensure low-risk; </li></ul><ul><li>Five (5) year, closed end fund seeking $100m and targeting 15.08% IRR, gross cash-on-cash returns of 1.98x and 15% distributions of cap. contributions in years three (3), four (4) and five (5); </li></ul><ul><li>GP is NorCal Capital Management LLC, whose predecessor fund earned 10.02% net of fees. </li></ul>
    10. 11. <ul><li>6-month balloon note secured by first deed of trust; </li></ul><ul><li>Interest-only payments at 12% and 6 points; </li></ul><ul><li>Loan amount includes both acquisition and improvement costs; </li></ul><ul><li>Available only for non-owner occupied, 1-4 unit single family residences targeted as rental properties (can include condos, townhomes PUDs); </li></ul><ul><li>Loan amounts based on 60% or less of the after-repair value . </li></ul>Provide Short Term Loans to Borrowers Seeking to “Buy & Hold” Distressed, 1-4 unit Single Family Income Properties:
    11. 12. <ul><li>Providing Borrowers Long Term Financing to Realize Property Appreciation: </li></ul><ul><li>3 to 5-year term with monthly adjustable interest rate (Target: 7.5% and six points); </li></ul><ul><li>Loan amount based on a max 65% of the asset’s after-repair value, secured by a 1st deed of trust (loan can feature rehab component as well); </li></ul><ul><li>Deed of Trust is a Shared Appreciation Mortgage (SAM) that entitles Fund to 20% to 50% of the collateral’s appreciation (minimum 20% - higher rates based on risk, deal flow, etc); </li></ul>
    12. 13. <ul><li>Creating a “one-stop” financing solution by providing borrowers a short term loan for purchase and rehab and a long term loan for positive cash flow rental income and property appreciation; </li></ul><ul><li>Obtaining equity positions in Single Family Income Properties by utilizing SAMs; </li></ul><ul><li>Focusing on under-serviced market of distressed, SFR income properties; </li></ul><ul><li>Using Cash Flow Valuation policy on underlying collateral and “Full Doc” underwriting guidelines to reduce default risk; </li></ul><ul><li>Using empirical data to target the best lending regions in California to increase returns and reduce risk; </li></ul>
    13. 14. <ul><li>Short Term Loans: </li></ul><ul><li>60% max LTV, 1 st position deed, 6-month balloon note; </li></ul><ul><li>All interest paid by borrower upfront in reserve account; </li></ul><ul><li>Borrower-based underwriting criteria – no subprime. Borrowers pre-qualified for take-out financing before receiving RFS loan; </li></ul><ul><li>Valuation of asset based on property’s ability to generate positive cash flow as a rental income property; </li></ul>
    14. 15. <ul><li>Long Term Loans: </li></ul><ul><li>1 st position deed at maximum 65% loan to value; </li></ul><ul><li>All loans have a target Debt Service Coverage Ratio of 1:1.2, ensuring that rent payments will cover mortgage; </li></ul><ul><li>Same underwriting and valuation process as Fund’s Short Term Loan – all borrowers “A Paper” quality; </li></ul><ul><li>Loans managed within 100-mile radius of Fund’s office; </li></ul>
    15. 16. <ul><li>Highly Experienced Team With a Successful Track Record in Sector; </li></ul><ul><ul><ul><li>Predecessor Fund had historical yield of 10.02% net of fees; </li></ul></ul></ul><ul><ul><ul><li>GP has decades of combined experience in mortgage brokering, banking and real estate investment; </li></ul></ul></ul><ul><li>Strong Potential Returns ; </li></ul><ul><ul><ul><li>Target IRR of 15.08%; </li></ul></ul></ul><ul><ul><ul><li>Cash distributions at a target 15+% beginning year three; </li></ul></ul></ul><ul><ul><ul><li>Equity position in properties could result in higher returns; </li></ul></ul></ul><ul><li>Low Risk, Asset-based, Alternative Fund; </li></ul><ul><ul><ul><li>94% of all capital contributions secured by 1 st deed of trust on real property at minimum 40% under market value; </li></ul></ul></ul><ul><ul><ul><li>Low correlation to stock market, low volatility market, low risk strategy, highly transparent fund and GP; </li></ul></ul></ul><ul><li>Equity Benefits Without Hassles of Ownership; </li></ul><ul><ul><ul><li>Shared Appreciation Mortgages create interest & point income and on-going equity position; </li></ul></ul></ul>
    16. 17. <ul><li>5-year, closed-end Limited Partnership. All capital recycled years 1 and 2; </li></ul><ul><li>General Partner is NorCal Capital Management, LLC </li></ul><ul><li>Seeking $100m, fully capitalized by EOY 2009; </li></ul><ul><li>Minimum investment: $1m; </li></ul><ul><li>Capital Draws of approx. $60m in Year 1, $40m in Year 2; </li></ul><ul><li>Target 15.08% IRR and net cash-on-cash returns of 1.94x; </li></ul><ul><li>Distributions of targeted average 15% of capital contributions beginning Year 3, paid quarterly; </li></ul><ul><li>Wrap-up at end of Year 5 should take less than 6 months; </li></ul><ul><li>No redemptions until wrap-up; </li></ul><ul><li>2% annual Management Fee, half of which is reinvested in Fund on behalf of GP. No Mgmt. Fee in years 4 and 5; </li></ul><ul><li>10% annual Performance Fee with 5.5% Hurdle Rate; </li></ul>
    17. 18. <ul><li>An Opportune, Alternative Investment: Fund has no ties to stock market volatility and provides financing niche that’s increasingly scarce; </li></ul><ul><li>Creative Income Generation: Loan products feature both debt and equity financing; </li></ul><ul><li>Low Risk: Unique underwriting and asset valuation process mitigates risk; </li></ul><ul><li>Excellent Potential Return : 5-year, closed end fund seeking $100m and targeting 15.08% IRR, net cash-on-cash returns of 1.94x and 15% cash distributions starting year 3; </li></ul><ul><li>Exemplary Performance and Experience: GP’s predecessor fund earned 10.02% net of fees while market values in California dropped 47% during same period. </li></ul>