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Landsmith ® Overview Educational Presentation Content copyright 2013. Landsmith. All rights reserved.
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Landsmith® Overview
Educational Presentation
Content copyright 2013. Landsmith. All rights reserved.
2Who we are?
.
Landsmith
is the largest provider of single family rental homes to institutional and retail
investors
We will sell over 1,000 homes in 2013
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
3What we do?
We take advantage of market opportunities
Find distressed homes in areas across the U.S. with strong real estate
fundamentals
Build and / or renovate
.
Sell to institutions, smaller investors , and
home buyers
Buy below the market
Make value-added improvements
Consider multiple exists
1 2 3
Invest in residential homes
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
4
Retail Sales
Opportunity Fund
Institutional Sales
Landsmith offers many synergistic products.
How we do it: Products
Legacy Products
Existing Funds
SFR Investment(2014)
6 products for success
Coming soon
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
We’ve Established the Right Process
AnalyzeGeographic
Markets
Pick Neighborhoo
ds
Select Homes or
Lots
Rehab or Build
Acquire Properties
Performdue
Diligence
Inspections
Home Marketed
Home Sold
How we do it: Process 5
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
66
We Identify the Right Locations through disciplined market assessment
How we do it: Process
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
7
– 500-700 properties screened daily to match buying criteria
– Proprietary tools and long-term relationships are used to manage pipeline and uncover hard-to-find deals.
Not-for-Profit Short Sale REO Auction Wholesale
HUDFannie / Freddie Bulk Portfolio Rental Pools
Raw List
Equity List
Bid / Proposal
Contract
Due Diligence
Closing
How we do it: Process
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
8
Each acquisition goes through full due diligence
Due diligence and document checklist
with signoffs
Pre-close inspections, comparables
analysis, rental rate analysis
Comprehensive document repository for audit, quality control, and third-party due
diligence
How we do it: Process
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
9
– Each acquisition goes through a rigorous approval process
AcquisitionPackage
AcquisitionCommittee Review
Approval /Denial
CIO CFO CAO
Director of acquisitions
How we do it: Process
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
10
– We carefully choose and supervise contractors or provide our own employees.
Contractor
Construction/ Rehab Bids
$$
Asset Manager Approval
Project Commencement
How we do it: Process
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
11
Multiple exits increases returns and reduces risks.
Opportunities 25 institutional buyers, thousands of investors, millions of homeowners
How we do it: Process
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
12 What we achieved: Institutional Sale Example
516 Homes Built, Rented, and Sold to an Institutional investor
Gross cap rates were 11.54%
.
Third Largest Single Family Rental Transaction in History (June 2013)
516$70mM 7.5%Sale Price Homes Net Cap Rate
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
13What we achieved: Retail Sale Example
9.5% Cap Rate to the Investor, with 20% “Cash on Cash “Returns
4415 Bellchime Drive, Indianapolis, IN. “Build-to-Rent” Construction
$110,000Sale Price
1-100 9.5%Homes Available Net Cap RateGross cap rates were
14.5%. Sold 30 homes.
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
14 What we achieved: Opportunity Fund Example
Smart Acquisitions, with efficient Renovations and rising market = Big Profit
Landsmith gained over a 50% gross return in under one year.
75 Homes Acquired From 6/22/2011 – 3/27/2012.
$7.39MTotal Cost
$4.85M $2.54MSales Price Gross Profit
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
15
What we achieved: Experience
*
2000+homes built by team
25000+
average experiencefor team
in business17years 30years
Institutional reporting
Nationalfootprint
Clients include Blackstone, Colony, AH4R, Beazer, ARP and others.
homes acquired, rehabilitated, and sold since 2010
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
16
What we achieved: Testimonials
“Landsmith is making a positive social impact”
– Non-Profit Organization
“Landsmith has a deep understanding of residential real estate.”
– Investment Advisor
“Landsmith has come up with a unique idea that could provide yield, diversification, and inflation hedge while doing social good."
– Family Office Advisor
Names provided upon request. Testimonial providers were not paid and other investors’ results may differ from those in the testimonial.
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
17
Inst
ituti
ona
l
Our Team
Reta
ilO
pport
unit
y SFR
Fund
Exis
ting
Funds
Legacy
Managing DirectorAcquisitions / DispositionsOperations
AccountingAsset Management
Pro
du
cts
Roles
CEO
Pre
siden
t
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
18
Our Team30+ years of experience in real estate finance, construction and development
Managed four very successful prior real estate funds
James Breitenstein, CFA Founder & CEO
Gary Miller Director of Acquisitions20 years of of real estate investments, with 2,000+ REO acquisitions
15 years of hands on construction management as a general contractor
30+ years real estate development experience
Entitled and developed 16,000 lots; constructed over 25,000 homes with senior management positions at D.R. Horton and Western Pacific Housing
Tony Rosenthal Chief Operating Officer
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
19
Our Team
14 years of operating experience in high-tech startups and multi-billion-dollar companies
Founding Partner, Illumant
Chang Kim Chief Technology Officer
10 years of experience in residential acquisition and sales.
Charla Messina Vice President of Acquisitions
Jennifer Lee Marketing Director15 years of experience in residential design, permitting, and construction.
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
20
homes in the US are bank owned “REO” or in foreclosure
2M
200K homes will be “flipped” this year.
Why it works: Big Market
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
21Why it works: Always Present
– The model works best in a rising market
There is always a rising market somewhere
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
2222
High gross margins , with multiple turns , can mean very high IRRs.
Why it works: High Gross Margins
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
23Why it works: Acknowledgment
Has become an institutional asset class
Committed to Single Family rental space
$10+ Billion* 35% +Americans that rent. About half multifamily, half single family homes. Same since
1965.
* - JPMorgan Chase & Goldman Sachs
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
24Why it works: Acknowledgment
Has become an institutional asset class
Opportunistic investment groups are managing hundreds of millions of
dollars.
$200mm+
Colony Capital recently invested $50mm in an opportunistic Operator.
Luxury House 'Flippers' Get a Lift 10/9/2013 Wall Street Journal
“… big money is chasing returns in a corner of the market typically dominated by mom-and-pop shops.”
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
25
Landsmith is the Right Choice.
26Contact us
Landsmith201 Spear Street Suite 1850San Francisco, CA 94105
(650) 328-4663
Who we are What we do How: ProductsHow:
ProcessesResults Team Why it works Fund Terms Contacts
