INVESTMENT OBJECTIVES AND STRATEGIES

Sherwood’s corporate objective is to purchase real estate properties at a discount, rehab them at a minimal expense with maximum affect, and sell them at a maximum sales price that maximizes profit margin. Secondarily, Sherwood strives to provide its investors with an above-average return on their investment (ROI) on these properties. The gross ROI goal is between 20% and 30%. The investment is secured by real estate collateral. Sherwood attempts to obtain relationship financing for its investments. This type of financing is a one-on-one relationship between Sherwood and the investor. This is explained in detail in the Investor Opportunity section.

Sherwood currently purchases single-family residences at a discount equal to around 50% of the After-Repaired Value (ARV). Rehab expenses are usually around 10%-20%, with a maximum total cost in the property of 70% of ARV. This formula is imperative for small properties with ARV’s under $150,000. With larger properties, the total cost percentage can be somewhat higher because of the dollar amount of profit involved.

Sherwood obtains its leads to purchase properties from several sources. Realtors are our main source, and their use of the Multiple Listing Service (MLS). Bank foreclosures and short sales make up the majority of the sellers sources. We also occasionally use Wholesalers who may have obtained an option on a property and then look to sell to an investor. We will use word of mouth in the real estate community…title companies, appraisers, inspectors, etc. And occasionally we are able to get resources from bankers, lawyers, CPA’s and Financial Planners.

Sherwood goes to great lengths to insure that the ARV of the property is as accurate as possible. We believe that the profit margin is as secure as possible when we purchase the property at a minimum sales price, maintain strict control over rehab expenses and the type of rehab that is performed, and estimate the ARV of the property with extreme accuracy. This profit margin allows us to withstand any surprises during the rehab period or any downward moves in the market. The property’s tax assessed value is also reviewed. If necessary, Sherwood hires an appraiser to provide a market value to the property based upon repairs and improvements that will be made to the property. We also take seriously the location of the property as it relates to schools, shopping, churches, recreation, and easy access to major thoroughfares.

Sherwood always obtains an inspection on the properties it purchases. There can be hidden problems with a property, and we want to find out as soon as possible if the property is worth moving forward. We will also bring in one of our well-qualified General Contractors to do a quick assessment of the potential costs involved with the rehab. This depends on what level of rehab will be performed based on the marketability of the property in that neighborhood. The rehab process is also maintained on a strict schedule of completion. We understand that time is money.

Investment Opportunities?