125k assignment fee !!!

[Jay Hinrichs]

I wrote  pretty much exactly one year ago that I paid my highest ever assignment fee  125k 

Well tonight I just got back from the planning commission meeting with a fully approved 90 lot subdivision

which my MAI  appraisal for the lots when shovel ready indicated the  value was  12,600,000   we are paying 7.4 million for this.

I have 10 acres sold to retirement home developer for 2.2 million in  a double close transaction.

so we are in the dirt ONLY 5.4 million..  with 3.1 to fully develop it puts us at 8.5 plus 500k in soft costs so round that to 9 million 

so today we found our selves with 3,600,000 of profit on the dirt.  but it just gets better we will build the houses out and the profit will go up 3X or more.. this is a good one.. 

its hard for me to pay assignment fee's and I paid this one within literally 30 minutes of the seller pulling the plug.. but took the risk and now looks like its going to work out just fine..  and this market while not red hot multiple offer type market its quite consistent .. 

so the risk/reward on this was I risked the 125k BEFORE we were annexed and certainly before approvals.. I spent another 250k getting to tonight's meeting  and I will spend another 125k on final engineering..  So while the wholesaler had a nice payday.. I certainly like my position.

Development is BIG time gamble but when it works boy does it work..  and of course all this money is cash up front since we don't own the dirt yet.

[Doug Pretorius]

Awww! It's so beautiful when @Jay Hinrichs admits he loves wholesalers :')