Family Fair, Inc. is a new company that will provide live entertainment and a special events facility in a former movie theater. The facility is located in a thriving business center in the midst of a densely and diversely populated community in Trinity, Texas. The operation focuses primarily on:
Family Fair, Inc. will be created as a closely-held private Texas S corporation based in Trinity County, to be owned by its founder and principal investors. The founder, Mary Ellen Garner, is seeking private investors for funding 35% of the project and holding a 35% share of the company. Ms. Garner currently owns Pro Power Productions, a small but successful company specializing in sound recording production, artist development, and concert promotion which would become a DBA of Family Fair, Inc.
Of the projected start-up expenses, a little less than half are consultant fees. The remainder are professional fees (legal, accounting, stationery, advertising for opening event, office rent, expensed equipment, start-up salaries, and contingencies. The founder and Board of Directors will finance a portion of the start-up expenses.
The cost of start-up assets needed comes to $979,000 which includes $550,000 for facility purchase, $373,000 for facility rehabilitation and operating equipment, and $56,000 for initial operating capital and prepaid expenses.
Start-up financing is planned as follows: The founder of Family Fair, a minority female, and the Board of Directors will invest toward start-up expenses. The company is seeking private investors for another portion of the total funding required with proportionate ownership of the company. It is planned to seek a low-interest, long-term mortgage for the improved facility. The founder and majority stockholder, Mary Garner, qualifies as a minority female business owner with excellent credit history, and is eligible for the best interest rate and terms with the SBA or other mortgage companies. As an option for investors to secure their investment with real estate equity, the mortgage will be negotiated as transferable to investors.
These assumptions are shown in the following table.
The Market Plaza Theater is located at 150 Market Plaza in Trinity, Texas. Family Fair proposes to purchase the 11,385 sq. ft. building and associated land area (18,923 sq. ft.).
The facility is structurally sound and was built in 1946 for movie theater operations. The theater property also includes a large neon lighted art-deco marquee-type sign near the busy intersection. A commercial appraisal has not been acquired by Family Fair, but the purchase price of the facility and associated real estate is consistent with current tax appraisal for the vacant facility. A commercial appraisal will be arranged upon request by a potential investor or mortgagor.
The rehabilitation of the facility will be accomplished in a manner consistent with city guidelines to qualify as an historical landmark which will provide a moratorium on city property taxes for 10 years. The Trinity Historical Society is anxious to sponsor this theater as an historical landmark. Internally, the theater will be renovated (seats restored, stage constructed, etc.) and the latest technology in sound and lighting equipment will be added. Dressing room facilities will be constructed in the renovation phase of rehabilitation.