Introduction
Golden Valley Real Estate, LLC (GVRE) is a start-up company in the Tucson area. It is the mission of GVRE to provide real estate services in the newly established Golden Valley Retirement Community, located to the Northwest of scenic Tucson, Arizona. GVRE is a full service real estate, mortgage, and title company.
The Company
GVRE will be a limited liability partnership registered in the state of Delaware for tax purposes. Its founder is Mrs. Susan Egan, a former agent for RE/MAX real estate company, where she worked for 23 years.
The company plans to be leveraged through private investment and a limited number of loans. The company expects to begin offering its services in June of 2003.
The company's main clients will be retirement age couples looking for a community that can offer significant services for their age group and income levels. Since Mrs. Egan is within this demographic group and knows and understands this market's needs, she believes that she can appeal to such clients far more than most other competitors.
The Services
GVRE offers comprehensive real estate, mortgage and title services to our diverse clients. With Quadrant Homes, Inc. as our sponsor in the newly finished Golden Valley Retirement Community, we will have a premier position as the dominant seller of these new homes, condos, and retirement apartments. In addition we will offer a full range of services to facilitate the purchasing and selling of real estate including the following:
- Home search database.
- Moving consulting, quotes, planning, etc.
- Mortgage consulting and loan preapproval.
- Community information.
- Title transfer.
- Obtaining a comparative market analysis for potential sellers.
- Appraising.
- Property preparation.
The Market
The retirement industry has been steadily growing over the past twenty years. The percentage of the U.S. population over the age of 55 is at an all time high of 21% and is growing at an average rate of 3% each year. In certain parts of the country like the American Southwest, which has a high concentration of retirement communities, the growth rate is about 8%. This percentage is also expected to grow as the first of the "baby boomer" generation begins to reach retirement age in the next decade. It is estimated by the U.S. Census Bureau that the retirement industry, that includes homes, medical facilities, specialty equipment, retirement entertainment services, etc., accounts for 4.8 billion dollars each year.
Financial Considerations
Start-up expenses and funding required are modest. They include expenses and the rest in cash needed to support operations until revenues reach an acceptable level. Most of the company's liabilities will come from outside private investors and management investment, however, we have current borrowing from Bank of America Commercial Investments, the principal to be paid off in two years. A long-term loan through Valley National Bank will be paid off in ten years.
The company expects to reach profitability in the first year and does not anticipate any serious cash flow problems. We conservatively believe that during the first three years, average profitability per month per segment will be adequate. We expect that about one sale per month will guarantee a break-even point.
1.1 Mission
It is the mission of GVRE to provide real estate services in the newly established Golden Valley retirement community, located to the Northwest of scenic Tucson, Arizona. GVRE is a full service real estate, mortgage, and title company.
Highlights
1.2 Keys to Success
GVRE's keys to long-term survivability and profitability are as follows:
- Establish and maintain close contacts with residential real estate listing services, and all other service organizations that GVRE uses, such as Artco mortgage service company.
- Keeping close contact with clients and establishing a well functioning long-term relationship with them to generate repeat business and obtain a top notch reputation.
- Establish a comprehensive service experience for our clients that includes consultation, appraisal, sale preparation, community information, moving consultation, etc.
1.3 Objectives
The three year goals for Golden Valley Real Estate (GVRE) are the following:
- Achieve break-even by year two.
- Finalize and then expand our contract with Quadrant Homes, Inc. to broker real estate property in the Golden Valley area.
- Establish minimum 95% customer satisfaction rate to establish long-term relationships with our clients and create word-of-mouth marketing.
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