Property Research Paper On Demographics State Of California

Desert Properties
Name
Institutional Affiliation
Desert Properties
Introduction
Real estate as an industry is a significant sector of the economy in terms of substantial development (Manning et. al., 2018). The sector has witnessed lots of costly investments and creation of thousands of employment opportunities. As a result of ever increasing demand for real estate, the sector has been developing over the years. Additionally, the ready market for property has led to the establishment of many companies involved in construction. This research paper singles out Desert Properties of Coachella Valley in California. The paper focuses on investment and marketing strategies, as well as other important aspects of real estate.
Mission Statement
Desert Properties has a mission to establish assets over the next five years. This implies that a portfolio of real estate assets will generate a supplementary source of retirement income. In the bid to maintain the culture and improve productivity, the company assumes a conservative approach on current principals to retain their employment on a full time basis. Desert properties are invests in two properties every year. This year, Desert Properties is managing Condos in Palm Desert, with offices at El Paseo. This property company operates in such a way that it purchases residential units. The units are selected on the basis of potential return on investment after rehabilitation or renovation is completed. In the long run, Desert Properties also invests on subsequent residential properties, which are rented out as incoming generating asset. This is supplementary equity investment to proceeds from sales of previously sold units. In end, the rented units are subject to long term appreciation.
Objectives
The major objectives of the Desert Properties include:
* To purchase low valued residential properties to generate monthly income after renovation and rehabilitation. To rent purchased units on market value, which appreciates in the long run.
* To engage in identification, evaluation, acquisition and sale of real estate properties for disposition or sale.
* To ensure that newly acquired residential properties are well rehabilitated or renovated
* To assume management of properties that are rented for the long term with regards to residential properties
* To manage real estate assets portfolio
Keys to Success
The main keys that has led to the success of Desert Properties include;
* Purchase of properties that are undervalued- The long term of short term gains are dictated by the amount of discount at which the properties are acquired.
* The company ensures that all the acquisitions, renovation or rehabilitation are done within the budgeted amount. The activities are also completed according to schedule
* The company only considers those opportunities that have specific attributes and conditions such as the option for immediate resale after rehabilitation or renovation after the short term gain is complete.
* The property management strives to identify occupants during the periods of rehabilitation or renovation so as to ensure occupancy immediately after completion.
* The property management ensures that cash flow is generated to address expenses and debt. The move provides funds for new property acquisitions. The cash flow is usually drawn from rental incomes.
* The company ensures that all the properties are at about 92% occupancy particularly on rental properties.
* Desert Properties allocates a 5% projected overall cash-on-cash return on all assets.
For these reasons, Desert Properties provides viable investment opportunities for potential investors. Similarly, the property management company provides quality properties at relatively affordable prices.
Executive Summary
Desert Properties is a real estate management company that acts as a source of income stream for investors and a source of affordable properties for buyers. The condos in Palm Desert are one of the properties that are sold every year by the property management company. In essence, the property is one of the many assets in the company portfolio that act as a source of monthly stream of income. With an investment goal of 5% on an unleveraged cash-on-cash, property sale and management such as the Condos in Palm Desert are valued at competitive prices. Investors on properties should consider the fact that the property management company acts on two productive principles. In this manner, the company has managed to retain employees and ensure consistency in terms of employment. Desert Properties has a policy on salary to partners; 50% of all the profits are reinvested in the company. When additional investment is drawn from profits, the profit margin will rise to the benefit of investors. However, the acquisition of residential properties are subjected to economic recession and depression on prices.
Just like the Condos that are currently on sale at affordable prices, the management company ensures that renovations or rehabilitations are done to meet high standards as desired by customers. In order to ensure great profits to investors, the company has good acquisition strategies. Properties are purchased at deep discounts for those units that face foreclosure with values below the market value. This is an indications that the acquisitions made will give room for significant profits after renovation and rehabilitation of the units. The creation of value and exploitation of opportunities at the company are usually based on the expertise of the management.
The managers normally ensure that all acquired properties must be able to produce a positive cash flow are they are rented. In addition, the company also ensures that the purchased homes must be in a condition of renting and producing a positive stream of income. This is made possible by acquiring homes that are undervalued, which are renovated for immediate resale. Therefore, the company works against policies that only ensure profits are gained through flipping of renovated properties: this a case of profit speculation. Profit speculation is considered to carry too much risk since the criterion used does not match the retirement portfolio of Desert Properties of Coachella Valley.
Sales Forecasts
Desert Properties has a 5 year projection on the number of residential units to be acquired. The management aims to sell over 10 renovated units in the next five years. The paper has given a brief overview of the financial statements linked to purchase of a single unit that spreads over to the next five years.
Company Summary
Desert Properties operates as a residential real estate management and investment business. Following this, the company acts as Portfolio Asset Manager, Property Manager, and Acquisition & Restoration Manager. Therefore, the main focus of the company lies on depressed residential real estate units or those that are undervalued. After acquisition, the company strives to renovate and resell or hold for renting purposes at attractive prices. In this type of business engagement, there are major components
* The business model employed
* The criterion used for investment
* Market analysis and summary
* The assessment of possible risks
* The expertise of available personnel
* This research paper will also include the financial plan, market plan and an example of property (Condos at Palm Desert).
Desert Properties is among the largest rental property and real estate investment businesses in the Palm Desert of California. The company manages day-day activities at the condos. However, to ensure excellent services are provided, accounting as well as professional legal services are outsourced. In the management model, the property management ensures that at least two top level managers retain their fulltime employment for the longest time possible. This is a strategy that reinforces their desire to expand the company and achieve long term value appreciation for the properties. Additionally, they will not be subjected to periodic compensation, but rather one that is permanent. The condos have been used as current example for sale. The company uses a favourable equity and debt sourcing strategies. Equity investment is placed at 20% of the price of acquisition, finance debt balance, and closing costs and fees. This property research paper has included a document that indicate the sample properties. It should also be noted that the company has sustainable business model, which is also flexible since employees may work from home offices as they retain their current employment.
Workers receive their salaries periodically. However, dividends earned from the previous investments are paid to investors as properties are sold or rented. This is done when the income generated no longer applies towards acquiring new residential properties. The company has minor costs that must be included in the business ledger: associated professional legal fees, office maintenance and insurance premiums. In order to harmonize the costs, Desert Properties ensures that these costs are covered by the income from rented units. The top level management is given much freedom of investment as major investors in terms of equity shares. Given the annual turnover of the company, there is need for more funding, especially from new and existing shareholders. The newly acquired residential units required renovations to modern standards. Table 1.0 Investment Strategies
Table 1.1 Expenses
Table 1.2 Funding with debt
Desert Properties Business Model
Desert Properties has an attractive business model that includes being a Limited Liability Company that is registered in the state of California. The company ownership is based on equity shares held by various active investors. The company prioritizes dividends owed to equity share holders. For instance, the condos at Palm Desert that are currently on sale at $254,000 hold good profits for the entire company (Rangel & Brilly, 2016). At the end of every sale, the company turns out with a positive profit margin. For this reason, Desert Properties is the best place for any investor who is interest in the real estate business. Therefore, this is a company that manage acquired real estate assets for partners, shareholders and other stakeholders. Most importantly, the company gives room for outside investors; the purchases made by them are labelled under a separate limited liability, which is still managed by Desert Properties. In essence, every property purchased has a separate LLC so that ownership is made simple as every deal is done independently. This is where outside investors have their chance of participation. However, their exclusive participation is subject to pass through tax benefits as well as limited liabilities.
Investment Criteria
The investment criteria employed by this property management company is attractive to any prospective real estate investor. One of the main points of investment include alre...