| 14 Luxury Townhomes on Montrose Blvd.
5/1/03 The 14 units have been listed since January. The model has been recently furnished and shows very well. There has been some interest, but no contracts as of this time. We are hopeful that we will see sales very soon. The price per square foot is an average amount related to other sales and offers in the area. The location is excellent.
The project still needs some additional construction. The spiral stairway in the rear (fire exit) was not made to code and must be re-manufactured. Three units in the rear need air conditioning condenser units installed. All the units (except for the model) needs general clean-up, and the purchaser will have their choice of carpet color and wood floor color finish.
The retail sales price of the units comes to approximately $5MM. The first loan by the partnership (investments by the Silver Chase partners) is approximately $4MM. The additional loan made to finish the project was $1,685,000, with an expected $100,000 needed in additional expenses to finish the entire project. Costs of insurance, interest, brokerage fees, utilities also needs to be taken into consideration.
7/6/03 The property is now being represented by Karpas Properties. We did not receive any contracts (either presales or 6 months after construction). The property is being detailed with many small issues being cleared up. Several M/M Liens have been cleared, with most all contractors paid for work performed. The A/C and Fire Sprinkler System contractor are the only open issues, but we expect to work things out within days. There are two pending contracts on the property. Hopefully both will close.
11/26/03 Thirteen of the 14 units will be auctioned in Houston on Saturday, December 6.
3/22/04 Three of the 14 units have been sold. Only one unit was a result of the auction. One unit is pending sale by the end of March '04. Eight other units have an earnest money agreement, but we are unsure that the units will close. Richard (Rick) A. Ehrlich continues to reside in one of the units, despite his obligation to move out as agreed.
5/12/05 Twelve of the 14 units have sold. The other two units are under contract and we hope to close on the first one mid May, and the other mid June. The proceeds collected so far have gone to pay off a $1.6MM construction loan, taxes for two years, insurance, and rehab of all 14 units in order to bring them up to standards where a buyer would be willing to purchase. The estimated recovery from this partnership is 12 - 16%.
6/9/05 Now 13 of the 14 units have been sold. The final unit is under contract and hopefully will close sometime in July. Renaissance on Montrose Corp. and Richard A. Ehrlich have filed a "pro se" suit against Silver Chase in an effort to receive commissions on sales after the foreclosure. Renaissance was foreclosed upon months ago do to a default.
12/31/05 All units have been sold. The HOA responsibilities have been transferred to the residents.
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