ARKIS PROPERTIES LLC Business Plan admin 8/20/2009 Arkis Properties LLC 1411 Potomac Ct Geneva, IL 60134 Cell (630) 973-8473 Fax (630) 232-2303
Arkis Properties LLC Business Plan Executive Summary Introduction Arkis Properties LLC is a real estate based company in the Chicagoland area. It is the mission of Arkis Properties LLC to purchase, hold, fix and sell real estate in order to generate sizeable dividends for our investors. Arkis Properties LLC has been established as a respectable company by helping homeowners in times of need, offering fair prices and great discounts to prospective buyers. Company Arkis Properties LLC is a limited liability company registered in the state of Illinois. Its founders are Dennis Argyrakis and Michele Argyrakis. Dennis Argyrakis is currently a full-time firefighter. He has 15 years experience in the building trades including all aspects of construction. He has also worked as a general contractor and maintenance and grounds manager for a 226 unit complex in Geneva, Illinois. Michele Argyrakis is in the medical field, working ten years in the stress-filled environment of the emergency room. She has also managed a small company teaching first aid and CPR. She has several years experience in marketing and sales for various industries. The company plans to be funded by private investors, loans and hard-money lenders. The company has been set up as a perpetual organization and will stay in business as long as there is investor support. The company s clients will eventually be anyone looking for any aspect of the real estate market. This will include buying or selling homes, new construction, loans or services. Services Arkis Properties LLC offers real estate and real estate services to people interested in selling, owning or fixing their homes. Our team of real estate professionals can help them with sales or purchases. We will offer new-construction purchases and make loans available for small funding requests. Market The market for Arkis Properties LLC will be first-time homebuyers, lower income families and those in financial distress. Our homes or units will be priced under the area median amount. We will offer several upgrades and amenities not often found in these price ranges. Whether it is a rehabbed property or a new construction, the client will know that he is getting more for his money than he would anywhere else.
Financial Considerations Most of the expenses needed are to build or remodel individual projects. The initial start- up costs were very modest. With a small budget, Arkis Properties LLC has given its investors sizeable returns. Additional funding requirements are needed to expand Arkis Properties LLC and establish it as one of the premiere real estate companies of the future. 1.1 Mission It is the mission of Arkis Properties LLC to purchase, hold, fix and sell real estate in order to generate sizeable dividends for our investors. Arkis Properties LLC has been established as a respectable company by helping homeowners in times of need, offering fair prices and great discounts to prospective buyers. 1.2 Keys to Success Arkis Properties LLC s keys to long term survivability and growth are as follows: Establish and maintain close contacts with several respectable real estate professionals, and all other service organizations related to the industry Secure funding and multiple lines of credit to be able to act on information in an aggressive manner Supply products and services to individuals that are better than what was expected Grow and expand at a pace that is just ahead of the rest of the industry 1.3 Objectives The three-year goals of Arkis Properties LLC are as follows: Rehab and sell three to five houses a year Supply consulting and rehab services to those wanting to sell their homes Purchase or build multi-unit buildings and sell individual condos Become a property management company generating a steady stream of income to the company The six-year goals for Arkis Properties LLC are as follows:
Double all the investors' money Develop several geographical areas in depressed markets ready to grow Offer a full range of real estate products and services to our clients Funding Current Assets: $71,000.00 Cash 44 King Dr, Streamwood, IL (value) $160,000.00 Expenses for rehabs: Purchase price per unit: $60,000 to $100,000 Repair costs: $20,000 to $40,000 Hold costs: $2,000 to $5,000 Purchases will be funded either by hard-money loans or conventional financing. The current cash assets of the company will fund repair costs. Expenses for developments: Purchase of land: $180,000 to $195,000 Land preparation, improvements: $120,000 to $130,000 Build cost per building: $250,000 to $275,000 Total needed to start project: $600,000 Funding for the project will need to be obtained from a combination of cash assets, conventional loans, hard-money or private investors.
Market Analysis Summary Arkis Properties LLC will target customers in several areas. Our clients will be those future homeowners wishing to get the most for their money. We will target those customers wishing for new properties or newly rehabbed units. Arkis Properties LLC will position itself in markets that are currently depressed and offer new construction where the market is poised for expansion. Our market analysis will include the current economic trends of the community, the infrastructure and monitoring community support for expansion. We will check each community's future plans, population and job growth projections. 2009 2010 2011 2012 Rehab Division: 9 mo. surplus 5 mo. surplus prices rising stable growth Development Div: Mattoon projects 0% pop. grows 1% grows 2.5% grows 2.5% Current market analysis shows for rehabs that there is a six- to nine month surplus in real estate keeping the prices low. Industry projections are showing a possible brief bubble in growth followed by a slow, sustainable expansion in the real estate market. Once the current inventories start to sell off, the shadow inventory will begin to flood the market. This will push back the earlier estimate of price increases from early 2010 to early 2011. The development project will show steady population growth over the next ten years due to several projects in the Coles County area. Certain areas of Coles County are expanding. A large business district, convention center and several hotels are being constructed in late 2009. Construction for a new power plant is also planned to start in early 2011. The early months of 2010 will be key to the Coles County future. Final approval is expected for the power plant. This is projected to start the population expansion of the area due to the new jobs coming to the area. With the increase of jobs and continued building, the population is projected to rise at a steady rate with an increase in job growth greater than the national average. The population is projected to grow by 100% over the next ten years supported by an increase of jobs by 16 to 25%.
Sales Forecast Rehab Division 2008 2009 2010 2011 2012 Rehab division: 1 3 5 8 10 Rehab ROI: 0% 16% 24% 32% 40% Sales Forecast Development Division 2008 2009 2010 2011 2012 Development div: 0 0 12 24 24 Development ROI: 0 0 12% 24% 24% Development sales are based on the projected population growth of the Coles County region. We have a project ready to begin once funding is obtained. Milestones Rehab division: Milestone projected date budget Single Property rehabs 3/15/08 $40,000 Multiple Simultaneous Properties 3/1/10 $80,000 Flipping 6-8 Properties a year 3/1/12 $120,000 Flipping 10-12 Properties a year 3/1/13 $160,000 Development division: Milestone projected date budget Research Areas 3/1/10 Find Areas Ready for Growth 3/1/11 Secure Funding 5/1/11 Pre-sell Units 8/1/11 $35,000 Permits 8/1/11 $25,000
Land Improvements 8/1/11 $130,000 Construction 10/1/11 to 10/1/14 $750,000 Sales / Closings 3/1/12 to 3/1/15 There are several measurable milestones in both the rehab division and the development division of Arkis Properties LLC. I will discuss both divisions below. In the rehab division of Arkis Properties LLC the milestones are defined by the amount of properties we are able to handle and the operating budget for each unit. As Arkis Properties LLC grows, our business contacts will grow. We will develop working relationships with several contractors and project managers. As our confidence in our personnel grows and our budget expands, we will rehab multiple properties simultaneously. We will continue to expand our budget and employees until we are able to comfortably rehab ten to 12 units per year. Our development division will start after our rehab division has proven to be successful. We will start researching depressed markets and look for an area ready for expansion. Once an area is found to fit the criteria for developing, funding will be secured and the building process will begin. Market analysis will be a continuous process for both present and future markets. We will stay current with the trends and still offer the best prices for our clients. Management Summary Arkis Properties LLC is a limited liability company registered in the state of Illinois. Its founders are Dennis Argyrakis and Michele Argyrakis. Dennis Argyrakis is currently a full-time firefighter. He has 15 years experience in the building trades including all aspects of construction. He has also worked as a general contractor and maintenance and grounds manager for a 226 unit complex in Geneva, Illinois. Michele Argyrakis is in the medical field, working ten years in the stress-filled environment of the emergency room. She has also run a small company teaching first aid and CPR. She has several years experience in marketing and sales for various industries. The rehab division of Arkis Properties LLC will expand and hire employees to run various aspects of the division. It will hire employees to run different projects in order to rehab multiple properties concurrently. Office and sales personnel will be needed as our number of rehabs expands. Arkis Properties LLC will also hire inspectors, contractors, and realtors eventually making our company a complete, multi-focal real estate company. The development division of Arkis Properties LLC will hire additional employees and consultants once it has reached the funding phase of a project. Prior to this phase contracted personnel will complete all work. When funding is secured, sales and construction personnel
will be hired. As the projects reach the construction stage, several carpenters and tradespecific personnel will be hired to build the units. Funding Conventional loans or hard-money lenders will secure funding for the purchases of units for the rehab division. The cash assets of Arkis Properties LLC will fund repair costs. When a unit sells, all debts will be paid. If conventional funding is secured, the note will be paid off before dividends are paid. If a hard-money loan was secured, the loan amount will be repaid plus the amount agreed upon in the terms of the loan. Then dividends will be paid. The developments division will secure funding for each project through a variety of different sources. These sources will include, but not be limited to, conventional loans, initial investors, hard-money and venture capitalists. Arkis Properties LLC developments division will use the funding for purchasing land, improving land and constructing buildings. Other funding will be required for hiring a sales staff and other expenses related to developing raw land into residential and mixed-use occupancies. Development Funding Needed Mattoon, IL project Expenses to fund: Land Purchase: $190,000 Land Improvements: $130,000 Building Construction $250,000 each Each building will cost $250,000 to build. As each unit sells, dividends will be paid and proceeds will be rolled back into the company. When the entire building sells, the original $250,000 raised to build the initial structure will be used to construct the next building. The entire complex can be built for less than $600,000.