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The Residence at Biltmore


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The Residence at Biltmore

  1. 1. The Residence at Biltmore • Introduction to Sundog • Introduction to Southern Resorts, LLC • Southern Resorts Philosophy -Holistic and Facilitative Approach to Property Management • The Residence at Biltmore- A Resort Condominium • The Residence at Biltmore-Hotel Operating model • The 100 day plan
  2. 2. A Resort Real Estate Company Based in Cullowhee NC
  3. 3. About Sundog Places Founded by Joel Sowers in 2007, located in Cullowhee, North Carolina Past-Executive Vice President- 23 Year Career-Fortune 200 Company – Real Estate President -Resort Real Estate Operation in the United States. Present- Sundog Places-Specialize in Western North Carolina Real Estate. We are a boutique specialized shop and very selective of who we choose to work for and represent. Biltmore Farms-The Ramble Sundrops on Caney Fork, a Sundog Development Bear Lake Reserve (select group of 35 to 40 owners) Serrus Capital Partners The Board of Directors of The Residences at Biltmore for at least the next 20 minutes We are; NC Real Estate Brokers, NC General Contractors- Unlimited license, Lifetime Students of Real Estate and Real Estate Junkies
  4. 4. Southern Resorts Partnership • Sundog and Serrus are 50/50 partners in Southern Resorts, LLC. • Steve Mudge and Joel Sowers worked together at Centex Destination Properties and have had a long standing professional relationship. • Centex Destination Properties, planned, designed, built and operated many resort and lifestyle properties that included condominiums, condo-hotels and resort properties and clubs.
  5. 5. Southern Resorts Condominiums and Condo Hotels We know Condo’s We have designed, built, marketed, sold, owned and operated thousands of Condominiums in North Carolina, Florida, California, Las Vegas, New Hampshire, Texas, Hawaii We have designed, built, marketed, sold, owned and operated Hotels and CondoHotels; some more notable are: Palm Coast Florida (Ocean Hammock- Hotel) Palm Springs (La Quinta) Oahu Hawaii- (Ko’ Olina) Horseshoe Bay Resort, Texas We have worked on resort properties w/ Disney, Ritz Carlton, Universal Studios, Intrawest, American Ski, Intercontinental Hotels, The Resort Group (HI).
  6. 6. Southern Resorts PhilosophyWe bring a Holistic Approach to Managing Real Estate Balancing Rental Incomes and…… Real Estate Values in the community
  7. 7. Why a balanced approach - rental incomes vs. real estate values?
  8. 8. Real Estate Values vs. Rental Income Owners Real Estate Value • $1- Owners keep 100% Rental Income • $1- Owners keep 50-65% • Property Manager -0% • Property Manager- 35-50% • LTCG Tax- 15% • Income tax rate-max 39+% As Real Estate Brokers- we have an agency relationship with owners and are programmed to work for the best interest of the owner.
  9. 9. First Question We were curious how The Residence at Biltmore condominiums compared in value today to similar sized condominiums in downtown Asheville? So we looked at downtown condominium closings in 2013 (thru September) that were between 700-1400 square feet
  10. 10. Market Values today The Residence of Biltmore $350.00 $300.00 Downtown Condominiums price per sq ft $250.00 $200.00 Biltmore Residences price per sq ft $150.00 $100.00 $50.00 $0.00 1
  11. 11. Residence at Biltmore Direct Market Comps Address 12 South Lexington Ave; unit 301 52 Biltmore 12 South Lexington Ave; unit 206 12 South Lexington Ave; unit 409 100 Coxe Ave, 409 12 South Lexington Ave; unit 409 155 S. Lexington 202B 155 S. Lexington 307B 59-c College St 2013 Asheville Condo Value Average size 205 Bowling Park Rd 115 Bowling Park Rd 2013 closed sale average List Price Sales Price $419,000 $353,000 $530,000 $500,000 $499,000 $465,000 $200,000 $209,000 $395,000 $3,570,00 0 $422,000 $340,000 $500,000 $460,000 $475,000 $441,000 $193,000 $201,000 $385,000 $3,417,00 0 $268,900 $269,900 $249,000 $249,000 $517,900 $518,900 Sq. Ft. Price sell Date per ft. 1310 $322 29-Aug 1344 $253 15-Apr 1400 $357 10-May 1250 $368 3-Jun 1306 $364 20-Sep 1133 $389 30-Aug 730 $264 7-Aug 817 $246 30-Aug 973 $396 10-Sep DOM 227 10 25 32 93 85 28 64 62 10,263 $332.94 1140 1026 $263 1026 $243 $2,052 $252.88 9-Sep 9-Sep $0 $0
  12. 12. The Residence at Biltmore approximate Valuation as a Condominium on 9/30/13 Downtown Asheville Valuations Unit Configuration Number of Units Todays Values using valuations sq. ft. $, 2013 closings) The Residence at Biltmore $252 per square foot 1 Br 2 Br 3 Br 506 763 1023 1386 11 Square footage from condo plan Studio 42 46 15 $127,512 $192,276 $257,796 $349,272 Total 104918 114 $26,575,920 Valuations using $333 dollars per square foot Valuations using Downtown closings between $200,000 and $750,000 or $333 per foot Difference in Market Value today $168,498 $254,079 $340,659 $461,538 $35.118,180 $8,542,260
  13. 13. Why do The Residences sell at a 24% market discount today? We looked at the following attributes that we consider primary drivers of value of residential real estate and could not come up with any deficiencies that we felt justified this discount…..
  14. 14. Real Estate Value-The Residences at Biltmore We believe the community has all the attributes necessary to be among the premier condominium properties in Asheville A. Located in a well known upscale location B. Near boutique shops and restaurants C. Close to major tourist destinations D. Quality healthcare nearby E. Outdoor pool and onsite fitness center F. Resident and guest parking is easily accessible G. Floor plans are comfortable H. Building design is attractive
  15. 15. The Hotel Market How do the service attributes at The Residence at Biltmore compare to other Biltmore Village Hotel attributes?
  16. 16. Hotel Services • Hotel Services available today at Biltmore Residences: – Housekeeping – Concierge service • Hotel Services typically found in luxury Residence marketed with a Hotel Brand: – – – – – – – – Valet Parking Bell Service - Concierge Room Service Restaurant on site Lobby Bar on site Banquet or Group facility Full Service Spa Housekeeping
  17. 17. Hotel Services • Hotel Services available today at Biltmore Residences: – Housekeeping – Concierge service • Hotel Services typically found in limited service Hotel Brands: – – – – – – Lobby Business Center Breakfast in the morning Evening cocktail hour Concierge Services Housekeeping
  18. 18. Hotel – Conclusions The property has some strategic opportunities to address in order to compete head to head with the area hotels. There are multiple options in how to position the property going forward.
  19. 19. The Southern Resorts Process: Have the Board of Directors assist our team develop a Strategic Marketing Plan for The Residences at Biltmore. Date- TBD ( First 30 days of being hired) Participants- The Board of Directors of the Residence at Biltmore Southern Resorts Officers (non property employee) Facilitator- Southern Resorts Employee Agenda Real Estate Values- Key Drivers - Positioning choices, Goals, Action plan Rental Incomes- Determine Marketing Positioning, Goals, Action plan Trip Advisor- Understand Ranking, Current Issues, Weighting, Action Plan
  20. 20. Southern Resorts Property-Highlights of Rental Terms • We are NC Brokers and have the Legal standing required by the state of NC to legally manage this property. • We are currently in the vacation-resort rental management business in Jackson County North Carolina ( 45 minutes west of Asheville) • Revenue Split to Owners – 65% of Gross Rental Income • Property Manager to retain all processing fees and convenience fees collected from tenants • Exclusive property managements agreements (24 months) that automatically renew for an additional 12 months if not cancelled 90 day prior to anniversary date • All incomes disbursed to owners monthly, within 20 days of month end. • Use of back of house and closets once control is seized by board
  21. 21. Residence at Biltmore – Resort Rental Model Project Staffing GM Owners Rep Reservation Call Center HK Mgr. HK Staff Front Desk Mgr.. Front Desk staff; Concierge. Maintenance Dept.
  22. 22. Condo Association Management • 24 Month Term- 90 day notice to terminate agreement or automatic one year extension • $15/unit/month plus $1,000 per month for accounting, monthly accounting • Manage all board and association meetings • Proposed budget by 10/1 of each year
  23. 23. The Rental Income? • We believe income levels will be determined by the goals established in the Strategic Marketing, which are unknown as of this projection. • Gross revenues across the property, using todays data, could be in the range of $4,000,000 to $5,000,000 dollars annually. This can vary greatly depending on the overall economy, number of units in the program ,the use patterns of current and future owners and owners level of commitment to position property to compete with all current and future area hotels . • 2014 Income projections will be subject to any collateral damage caused by any current and or future litigation with the existing management company.