$8.3M & an IRR of just over 40%
We are excited to announce yet another milestone for the Arabella Real Estate Fund and those invested. As of last week, we have an executed contract on Steeplechase for $8.3M, which would give us & our investors a realized IRR of just over 40%.
Steeplechase was developed in 2007-2008 as a single-family subdivision. The community contains 63 single-family lots (approx. 3⁄4+ acre each), along with a horse barn, swimming pool and community pavilion with fireplace. Development of the project was virtually completed but stopped short of obtaining a final subdivision plat when the real estate market crashed. We acquired Steeplechase in 2021 and have since platted the development. Our intention has been to build $600k homes on roughly 1 acre lots.
Steeplechase, 63 plotted lots, will sell in three phases. The first 25-30 lots will sell in the next 60 days. Then another batch of lots in 6 months, and the remaining lots 6 months later.
Interested in Investing?
Instant Equity for Investors
One way to value a fund is based on its NAV, the Net Asset Value, or the fund’s assets less its liabilities, divided by the number of shares outstanding. This essentially represents an investor’s equity in a particular fund. The sooner you invest, the more equity you are able to secure, per share. What this means for the Arabella Real Estate Fund is that for every $56,000 invested today, that share is actually worth $72,000. That’s $18,000 of instant equity per share. As the fund matures, the initial investment per share will continue to increase. The sooner you decide to invest in the fund, the more equity you will secure.
NAV will Increase
Once we we close on Steeplechase, it will increase an investor’s equity, or share value in the fund, as we will be cashing out on some of the value that has been created since we purchased the land last year. This is an example of how a project will help us realize our target minimum IRR of 25%, over the span of the fund.
Next Steps
If you are not currently invested in the Arabella Real Estate Fund and would like to capitalize on the timing of this opportunity, you’ll need to have your investment wired prior to closing. Again, that is roughly 45-60 days from today.
If you have questions, as the Fund Manager, I would love to connect with you. Feel free to schedule a call with me by clicking here.