Pushing Properties Out the Door

Investors and Colleagues,

Spring has sprung, and that means plenty of activity at the Ashford Capital headquarters.

Over the past few weeks I have been extremely busy working on both the acquisition side of our business (negotiating the purchase of distressed properties at incredible valuations), as well as on the sale side (completion of individual investment programs by selling to builders).

While the US as a whole may be experiencing continued challenges in the residential real estate market, we are seeing tremendous opportunities on both sides of the investment process – and our investors are booking profits along the way.

National Home Sales Slide, but Niche Markets are Strong

You may have seen the recent headline: US New Home Sales Tumble 16.9%…

On a national scale, the environment for new homes is certainly challenging. My last letter to you outlined how this environment is offering us some tremendous opportunities to pick up properties from distressed banks who have had to foreclose on residential developments. Banks operating on a national level are desperately trying to unload this inventory – at nearly ANY reasonable price – just to keep their capital ratios in line and beef up their balance sheets.

Since banks have little choice but to sell the most liquid of these foreclosed assets, Ashford Capital is able to negotiate to purchase the very best properties, while we bypass the lower quality pieces that don’t measure up to our high standards.

This month, I’ve been negotiating with Bank of America to purchase a particular set of high quality lots. The property is in high demand (I am already in discussions with a potential buyer), and Bank of America needs to move the property quickly. These are exactly the kind of opportunities that we like to capture in today’s distressed market.

Cashing In and Moving On

The national banks may be desperate to get rid of foreclosed properties, but on the other end of the spectrum, builders are desperate to see their business pick back up.

Think about it for a second. If you’re a builder in today’s environment, how are you going to stay in business? The only way that many of these companies are going to make it is to build the very best homes in the most attractive neighborhoods. And this is where our planning comes into play.

Over the last two years, we have been active buyers in these attractive neighborhoods. Increasingly, if you are a builder and want to roll out a new development, Ashford Capital is the company you need to negotiate with!

This is great news for our investors, because when we sell a property, our investors are able to cash in on their purchase. Not only do our investors realize a guaranteed preferred rate of return on their principal, but they also participate in the profit of the deal. So when a builder comes into my office and signs the purchase papers for one of our developments, we ring the register for each of our investors in that particular deal.

At this point, I have a buyer at the table who is very interested in three of our existing properties (neighborhoods you have heard me talk about several times in the past). I’m looking forward to sending a congratulatory email to each of our investors participating in these deals, once we finalize the transaction.

Don’t Miss Out on the Next Success Story

If you’ve been sitting on the fence, wondering when you should take action in today’s real estate market, it’s time to step into action.

As excited as I am about the properties that we are selling and cashing in on, I’m also slightly disappointed. I have several friends and colleagues who were interested in these properties when we originally bought them, but for some reason or another they did not pull the trigger. As we approach the period in which they would have been cashing in on a tremendous investment, I’m disappointed that they are not on board.

Don’t let this situation happen to you. The opportunities that we see today won’t be around forever. Banks will not always be desperate to unload inventory, and the FDIC will not always hold a portfolio of distressed real estate assets.

Now is the time, and today is your opportunity. Give me a call right away so that we can discuss how Ashford Capital can help YOU take advantage of the unprecedented opportunities. I look forward to hearing from you very soon.

Wishing you every success,