Lending Opportunities in
Distressed Real Estate




May 2010
Investment Disclosure

•   This summary and analysis does not constitute an offer or sale of
    securities but is merely ...
Opportunity

•   High Demand. There is strong demand for high interest rate
    loans to investors for the acquisition of ...
Lending Criteria

•   Loan Amount. The lending ratios range between:
      –   70% - 80% Loan to Cost.
      –   60% Loan ...
Risk Mitigation

•   Low Loan-to-Cost. All loans require 20%-30% down from the
    borrower. We expect to never exceed 60%...
Investment Overview

•   Investment Offering. Boomerang is raising up to $10 million in
    equity to invest in this strat...
Current Portfolio                                  .

               Loan Face                                 Origination...
Current Portfolio Summary
                             as of 4/30/2010                          .




•   Average Gross IR...
Our Structure


               Boomerang JD, LLC          Loans executed by
                 John Doe – 100%         Boome...
Market Outlook                   .




•   Volume. Homes sold at auction in Phoenix will remain high
    through 2012 due ...
Contacts

Gregg Scoresby
    Principal
    Boomerang Capital Partners
    Direct: 480.650.8150



Spencer Owens
    Direct...
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Lending Presentation

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This is an overview of current real estate investment opportunities in the Phoenix area.

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Transcript of "Lending Presentation"

  1. 1. Lending Opportunities in Distressed Real Estate May 2010
  2. 2. Investment Disclosure • This summary and analysis does not constitute an offer or sale of securities but is merely a solicitation of interest in Boomerang Capital Partners, LLC and its affiliated entities. • Securities may not be offered or sold in the United States absent registration or exemption from registration under the US Securities Act of 1933. • The offer or sale of any securities of any entity affiliated with Boomerang Capital Partners, LLC will only be made by means of formal offering documentation that complies with all applicable federal and state securities laws and consists of definitive investment documentation. Page 2 Confidential
  3. 3. Opportunity • High Demand. There is strong demand for high interest rate loans to investors for the acquisition of foreclosed homes purchased at auctions in the metro Phoenix area. • Excellent Liquidity. Short term loans create a higher than normal liquidity rate in real estate and reduce many long-term risk factors. Most loans are paid back in less than 75 days. • Conservative Terms. Borrowers are willing to contribute substantial equity at conservative valuations for short-term loans which greatly reduces the risk of default. • Expected Returns. Due to prepaid interest, high annual interest rate, and transaction costs we expect gross IRR to range between 20% and 25%. Page 3 Confidential
  4. 4. Lending Criteria • Loan Amount. The lending ratios range between: – 70% - 80% Loan to Cost. – 60% Loan to Value. • Transaction Costs. Borrower pays $500-$1,000 in loan preparation fees at closing. • Terms. Loans are made for 6 months with at least 1 month of prepaid interest. Extensions may be offered for additional fees. • Interest Rate. Our rates range from 17% - 19% per annum depending on loan size. • Cross Collateralization. We require borrowers to cross collateralize all assets where we are the lender. Page 4 Confidential
  5. 5. Risk Mitigation • Low Loan-to-Cost. All loans require 20%-30% down from the borrower. We expect to never exceed 60% LTV. • Senior Lien. We will always be in first recorded lien position on the deed of trust, and disallow any subordinate debt. • Cross Collateralization. If a borrower defaults on one loan then all loans for that borrower are considered to be in default. • Personal Guarantee. We require borrowers to sign a personal guarantee to further secure our note. • Lender’s Insurance. A lender’s insurance policy is available at the time the Trustee’s Deed is recorded. • Worst Case Scenario. If the borrower defaults on the loan all collateral will be taken back via foreclosure. Page 5 Confidential
  6. 6. Investment Overview • Investment Offering. Boomerang is raising up to $10 million in equity to invest in this strategy. • Accredited Investors. This investment opportunity is being offered only to accredited investors. • No Management Fee. Boomerang Capital Partners will not take a management fee, but will participate in profits only. • Profit Split. Lending profits will be split 70/30 in favor of the investor. Profits will be calculated only upon payoff of each loan. • Distributions. Distributions will be made annually or upon request with 90 days notice, or when funds become available. • Target Gross IRR. The investment has a target gross IRR between 20% and 25%. Page 6 Confidential
  7. 7. Current Portfolio . Loan Face Origination Hold Time Loan # Amount LTC LTV Date Payoff Date (days) Gross IRR L0001 56,840 70% 55% 11/24/2009 1/4/2010 41 40.0% L0002 60,000 68% 50% 12/9/2009 3/23/2010 104 26.6% L0003 70,000 70% 56% 1/11/2010 3/5/2010 53 19.6% L0004 47,000 48% 34% 1/11/2010 4/1/2010 80 19.0% L0005 83,650 70% 60% 1/11/2010 3/19/2010 67 19.6% L0006 87,000 79% 60% 1/12/2010 4/13/2010 91 22.8% L0007 87,000 66% 60% 1/20/2010 3/23/2010 62 19.6% L0008 85,200 80% 53% 1/20/2010 112 L0009 68,000 71% 54% 2/12/2010 4/28/2010 75 22.0% L0010 77,000 70% 56% 2/16/2010 85 L0011 57,000 70% 51% 2/17/2010 4/16/2010 58 24.8% L0012 33,000 70% 41% 2/22/2010 4/29/2010 66 28.2% L0013 75,000 78% 60% 2/24/2010 77 L0014 75,000 77% 60% 2/25/2010 76 L0015 73,000 80% 56% 2/25/2010 4/30/2010 64 25.1% L0016 108,000 80% 60% 2/25/2010 4/21/2010 55 25.8% L0017 60,000 71% 55% 3/1/2010 4/15/2010 45 26.2% L0018 203,000 75% 58% 3/4/2010 69 L0019 33,400 77% 42% 3/5/2010 68 L0020 144,000 72% 60% 3/11/2010 4/20/2010 40 25.7% L0021 73,600 80% 59% 3/15/2010 4/28/2010 44 25.6% L0022 65,000 76% 60% 3/17/2010 5/25/2010 69 28.7% L0023 200,000 62% 51% 3/17/2010 56 L0024 85,000 79% 59% 3/23/2010 5/12/2010 50 29.3% L0025 44,000 70% 55% 4/2/2010 5/13/2010 41 29.6% L0026 78,000 78% 60% 4/21/2010 5/17/2010 26 35.8% L0027 88,000 79% 52% 4/21/2010 5/21/2010 30 31.9% L0028 170,000 70% 61% 4/23/2010 19 L0029 117,000 74% 60% 4/29/2010 13 Average: $ 85,115 73% 55% Projected Average: 58 26.3% Page 7 Confidential Past performance is no guarantee of future results
  8. 8. Current Portfolio Summary as of 4/30/2010 . • Average Gross IRR. Actual closed loans are averaging 24.4%. • Average Net IRR. Closed loans are averaging 16.5% to investors. • Repeat Borrowers. We are averaging 1.6 loans per borrower. • Performing Loans. 100% of all loans are in good standing. • Default Rate. The expected default rate for all current loans is 0%. • Payback period. The average payback period to date is 58 days. • Excess Demand. Loan demand exceeds available capital by 4x. Page 8 Confidential
  9. 9. Our Structure Boomerang JD, LLC Loans executed by John Doe – 100% Boomerang JD, LLC John Doe Owner and serviced by Boomerang Capital Boomerang Capital Partners – Manager Partners Boomerang Capital Interest payments and Partners invoices payoffs received into Boomerang JD for Boomerang JD, LLC services rendered account Page 9 Confidential
  10. 10. Market Outlook . • Volume. Homes sold at auction in Phoenix will remain high through 2012 due to higher than average negative equity. • Foreclosure Pricing. Prices paid at auction are driven by investors with a 3-4 month flip timeframe, keeping prices low. • Current Resale Pricing. Recent sales data supports the assumption that home prices under $300k have bottomed out. • Future Resale Pricing. A very slow turnaround is expected. Analysts suspect little to no appreciation for the next 5 years. Page 10 Confidential
  11. 11. Contacts Gregg Scoresby Principal Boomerang Capital Partners Direct: 480.650.8150 Spencer Owens Director of Capital Investments Boomerang Capital Partners Direct: 480.302.3568 Page 11 Confidential

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