Little Rock, AR
Little Rock, AR 72206
SD-IRA Joint Venture
This is a 10-unit Multi-Family building that we purchased in 2016 with a Joint Venture Partner using funds from their Self-Directed IRA. The purchase price was $312,500. Rehab costs were estimated at $100,000. We used a loan from the bank for the purchase price and the rehab costs.
Our Joint Venture Partner funded the down payment of $82,500. At the end of 5 years she will get her $82,500 + 40% of the remaining balance of the sale after the bank and all expenses are paid. We are planning on selling in the spring of 2021. At which time, the property is targeted to be worth $750,000, based on the income approach.
Our JV partner is estimated to receive $89,000 over and above the initial $82,500 when we sell for an ROI of 21% per year ($89,000/5yrs = $17,800 per year / $82,500 initial inv. = 21% ROI per year). That will more than double their money they used from their their 401K in 5 years.