Here is something I created as we look for partners in this venture.
Seeking
Business Partners and Investors
The November issue of Texas Monthly and the question they ask is the
same one I am asking of you “You Want In?”. I encourage you to get a copy of
this magazine and read it, for it contains well researched stories of fortunes
made, fortunes lost, and it tells of the regrets of those who missed out
because of fear, lack of confidence, or other reasons they chose not to get
involved.
I am a
businessman who has extensive experience in creating companies and helping
others build or fix their businesses. I know how to make money and see
opportunity everywhere I look. I am also a Christian and desire that everything
I do will glorify the God who loves us so much He sent His son to die in order
to grant all who believe the gift of eternal life. There are some who say
“Don’t mix religion with business”. If that is how you feel there is no point
in reading any further because God will always be at the head of everything I
do.
Proposed Project for "Interstate Oasis"
We are talking
about a million plus dollar project here so there is some serious money
involved. At the risk of scaring potential investors away I will say that making
money is not my primary goal in creating this enterprise. My desire is to help
people, to provide badly needed housing and resources to assist them in
building a successful life as they come into the area, seeking jobs and the
opportunities this oil boom offers. But in the process we will make money, lots
of it.
Investors
generally are looking for either a quick payback of their money or a long term
deal that will create a reliable source of income that will provide for many
years in the future. I offer both with this venture. First let me present a
concise overview of what we intend to do and how this will be structured.
One of the big
needs created by this oil boom is for housing. Right now there are
multi-million dollar hotels, apartment complexes, and housing developments
being built as rapidly as supplies and manpower can allow. In all booms prices
of everything skyrocket and that is certainly true today. Land values have
quickly gone out of sight. This venture revolves around the 75 acres of
farmland we own near interstate 20 and the opportunity we have to purchase an
old store building on the interstate at exit 151.
Here is a proposed
sequence of events – some will happen concurrently.
1.
Purchase the property
on interstate 20
2.
Create a limited
liability corporation (LLC) to be the legal entity that provides the structure
required to correctly manage the funds and administrative requirements of
building this great enterprise.
3.
Begin building
infrastructure for RV park, short term housing, camp sites, and associated
support buildings
4.
Install RV pads and
build housing
5.
Market property and
begin making money
Time to
include some basic math for this venture. 200 RV spots renting at $500.00 a
month can generate $100,000 dollars each month for a yearly potential of 1.2
million dollars. The 16’ X 32’ pre-built single bedroom housing units I propose
to place on the interstate property and the farm are available through several
companies and can be purchased for $27,000. These homes come finished out with
bathroom, hot water, and a kitchenette. I am of the mindset that we can buy the
building shells and finish them on site for half that price, with two bedroom
units costing only a few pennies more. These unique homes can easily be rented
for $1000 or more a month, based on current rental rates in the area, and 50 of
them could produce $50,000 a month. That adds up to $600.000 dollars a year for
only 50 units and we have room to place far more than that. These small
efficient homes will easily pay for themselves in 2 years. Adding support
services such as laundry, restaurant, and a store to supply needs and wants
will generate supplemental income.
A Bit of
Property History
It was January 2013 when I first found out that the old store on I-20,
right down the road from our farm, was available for sale. This was an
opportunity I had been praying about for years, even before I worked for the
man who had owned it. He passed away late 2012 and thus the property is
available. I had a business concept all worked out and presented it to many
friends. A few of them agreed to invest in the idea so I made an offer on the
property. When it came to actually purchasing that old store we had a title
company look at it to warranty the deed and that is when we discovered the
title was “cloudy”. This slowed things down quite a bit.
After eleven months we have finally received legal advice that gives us
confidence to move forward on purchasing the old store at mile marker 151 on
Interstate 20. The title to the property was cloudy due to a clerical error
made in 1953 when someone mislabeled a little .22 acre strip of land shown on
the survey map. That strip was called “tract A”. All of the subsequent buyers
of the property over the next sixty years showed tract A on their deeds and
left out tract B, which is the main body of the property and contains the store
itself so the clerical error was passed along with no one noticing.
The
property lines have been recognized for those sixty years and are clearly
evidenced by the existing fence and even more striking is the fact that the
land the old store is on is dramatically higher than the surrounding farm land.
This is a result of the farm land being constantly plowed and suffering erosion
from wind and rain.
In
addition to that is the fact that there was a house on this property that
rested on both the .22 acre strip and the main body of land along with the
water well, which is on the edge of the .22 acre strip and supplies water to
the old store through underground piping. This house was leased, then sold, and
moved off of the property. This clearly illustrates that the questioned strip
was always considered a part of the property despite discrepancies in the legal
description.
Now
that we have assurances that this can proceed without fear of legal issues I am
pushing forward. Unfortunately some of the investors we had lined up have
experienced changes in their situations so are no longer able to participate.
Ten months is a long time to wait. That means now I must once again present
this opportunity and seek partners for this venture.
Options and
Ideas for Property Use – Now and in the Future
Buying
the old store is a safe bet for several reasons. First of all the corridor
along I-20 heading east from Midland is being rapidly developed so property
values have already skyrocketed. One option is to purchase this strategically
located brick building that has a steel roof and convert it to provide housing
and rent it out. This would quickly turn it into an income producing property
with little needed in the way of further investment. It contains two bathrooms
and one shower currently. There is plenty of room in the approximately half
acre space to provide space for RV’s and/or campground type cabins for rent.
This would create an easy and quick source of income with the property that could
help bring a quick return on investment.
In
my mind a better option would be to turn the old store into a new store. This
will take some work as it would require shelving, building a counter, and to do
it right a cooler section to house soft drinks and frozen items. Eventually it
would be an ideal location for fast food type service but I would work towards
that slowly as that decision will bring health department regulations and rules
to understand and abide with.
My
ultimate goal for this property is for it to be the gateway to the development
on our farmland just a mile or so up the road. With its strategic location on
the interstate, at an exit and on ramp, it provides an ideal location that
affords both high visibility signage and easy access for potential clients to
interface with us and sign in for services we can provide through the Oasis RV
park, campground, and short term housing. It can do this while remaining a
store.
The
purchase price for the old store and the land it sits on is now $35,000. My
original offer was $45,000 but I reduced it because of the title issues. We
need to move on this aspect quickly. I have already been approached by one of
the companies developing along the interstate regarding selling my land. I
explained I desired to develop it and create an income generating business and
they said they would consider partnering with us.
My
original plans have evolved. That is because as I researched what others in the
area are doing and looked at the current market and needs, I have learned better
ways of approaching this. Originally my concept was to create an RV Park and
that is still part of the plan, but other ways exist to address the primary
need of housing for this area.
The
option of building "man camps" are one of the ways housing and
related services are provided in many parts of the country that are
experiencing similar oil booms. These can house anywhere from 200 to 3000 or
more people. I have looked into these operations and there is no question that
they can be incredibly lucrative. Unless an interested and experienced operator
approaches us, I think it will prove wiser to approach building this enterprise
in a more conservative manner.
There
is a lot of work to do and research that needs to be accomplished. One of our
investors asked a good question. He knows I am working full time managing an
office furniture store for an elderly couple, who got into a bind when they
purchased it as an investment. He asked me if I thought I would be able to find
the time to properly focus on this project. I assured him I could, that I would
make the time, however as I pondered his question and examined my
responsibility I realize that I can’t do this by myself, I really need some
help. This needs to be a group effort. There are companies converting shipping
containers into housing and we want to explore that too.
We
are talking about building a company, which is something I am familiar with.
This will require finding people with various skill sets who can work together
and achieve goals. I am looking for investors as well as partners who are
willing to get involved and work with me to accomplish something we can all be
proud of. Some investors will not want to get deeply involved and that is fine
because they won’t have to. Some will be hands on folks but the reality is we
will need to employ those who have the particular abilities needed to
accomplish each phase of this venture.
This
project will proceed in a step by step manner. First order of business is to
obtain the interstate property. That by itself is a safe real estate
investment. Putting in RV pads and building housing can be done at a pace
regulated by the level of funds available, with each pad or housing unit
becoming an income generator as soon as it is finished. It can be done one pad
or building at a time or with greater resources a larger number at once.
Email or reply if you want in. There are billions of dollars flying around the Permian Basin right now and plenty of opportunity to be had. Just takes a little gumption to do it and we are making a safe path to do so now. Look forward to seeing what hard work and foresight can create.
Thank you,
Bob Westbrook
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