Onyx Capital Partners LLC

Real Estate Private Equity. Owner of Cutting Edge Management LLC, a property management company

[Onyx Capital Partners LLC @ocpinvCRE]

#RE #CRE #Realestate #Lending #CommercialRealEstate #Finance #Capital #RaisingCapital #Wealth #Investing #Investments #Invest #LP #GP #Equity

[Onyx Capital Partners LLC @ocpinvCRE]

Two Deals Currently Under Contract:
We recently went under contract on two high-quality, core properties and will walk you through the approach for both:
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[Onyx Capital Partners LLC @ocpinvCRE]

Base Case Expected Gross Cash on Cash (CoC) Returns Year 1:
Property 1 (duplex): 10.8%
Property 2 (single family): 9.7%

Base Case Expected CoC (10yr hold):
Property 1: 15.8%
Property 2: 14.6%

Base Case Expected Levered IRR (10yr hold):
Property 1: 18.5%
Property 2: 17.7%
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[Onyx Capital Partners LLC @ocpinvCRE]

#RE #CRE #Realestate #Lending #CommercialRealEstate #Finance #Capital #RaisingCapital #Wealth #Investing #Investments #Invest #LP #GP #Equity

[Onyx Capital Partners LLC @ocpinvCRE]

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Additional Expectations:
In our model, we are projecting a conservative $900/yr in insurance costs for each property as our portfolio of SFH in this market is south of $800 on average. Further, we are budgeting $6,000 in working capital up front, though both properties are in newer condition with little to no work required. We also estimate 10% in closing costs as an additional conservative underwriting amount to buffer the working capital budget. Annually, we also will be budgeting an additional ~$1,000 per year in capex reserves to boost the working capital budget.

[Onyx Capital Partners LLC @ocpinvCRE]

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Base Case Expected Gross Cash on Cash (CoC) Returns Year 1:
Property 1: 8.3%
Property 2: 8.1%

Base Case Expected CoC (10yr hold):
Property 1: 12.8%
Property 2: 12.2%

Base Case Expected Levered IRR (10yr hold):
Property 1: 17.2%
Property 2: 15.8%

[Onyx Capital Partners LLC @ocpinvCRE]

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For Property 2, our model suggests we need to purchase around $110,000. While the property is a newer list, there is limited buyer interest so far likely due to ineffective marketing and more supply on market (e.g., more 3-bed homes on market may reduce primary home buyers on this 2-bed). Therefore, we are seeking to offer $105,000 all cash and waiving contingencies to begin negotiations, likely settling around $110,000 purchase. Closing with a mortgage, we are expecting our gross cash returns year 1 to be north of our target 8% at $1,250 rent. Similar to Property 1, we expect cash returns closer to 10%+ year 1 with slightly higher rents and possible pet fee.

[Onyx Capital Partners LLC @ocpinvCRE]

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Property 2:
2 beds, 1 bath, 1,000 SQFT, newer remodel
Original List: $120,000
Current List: $120,000
Estimated Market Value: $120,000
DOM: <1 month
Vacant
Market Rent: $1,250-$1,295

[Onyx Capital Partners LLC @ocpinvCRE]

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For Property 1, our model suggests we need to purchase around $125,000. With 2 months on market and seller incurring holding costs, we believe we are in a good position to negotiate down another 10%+. We are making an all-cash offer and waiving contingencies at $120,000 to begin negotiations, and hopefully settling around a $125,000 executed price. Closing with a mortgage, we are expecting our gross cash returns year 1 to be north of our target 8% at $1,450 rent. More likely, it may be closer to a 10% return if we charge a pet fee.

[Onyx Capital Partners LLC @ocpinvCRE]

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Property 1:
4 beds, 1 bath, 1400+ SQFT, new remodel
Original List: $150,000
Current List: $140,000
Estimated Market Value: $140,000
DOM: 2 months+
Vacant
Market Rent: $1,450-$1,500

[Onyx Capital Partners LLC @ocpinvCRE]

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Recent Tours and Offers:
We recently toured through two properties with the following metrics and will walk you through our approach to both:

[Onyx Capital Partners LLC @ocpinvCRE]

#RE #CRE #Realestate #Lending #CommercialRealEstate #Finance #Capital #RaisingCapital #Wealth #Investing #Investments #Invest #LP #GP #Equity

[Onyx Capital Partners LLC @ocpinvCRE]

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Our Offering Process:
When offering to purchase properties, the most effective formula for us involves a scalable and repeatable process using considerations below:

[Onyx Capital Partners LLC @ocpinvCRE]

Offer:
To make our offer competitive, we may waive all contingencies but require a 3-5 day DD period for our contractor to assess, allowing us to terminate the purchase if needed. We offer all cash with a 45-day closing period, allowing us to pursue a mortgage instead of cash.