We sold some lots!

We sold some lots!

This week we opened up our lots to the market. We have already gotten a commitment on 2 lots! Now that we have gone through the process of doing a ‘condominium,’ the word for a legal subdivision in Costa Rica, we can see why the value of the end product is so high.

It’s a very difficult and expensive process to complete. We are extremely confident at the current value of our lots and are seeing that confidence confirmed as we have started selling. We are very excited to see the project finally come to life.

I have never tried to sell anything to anyone through this email up to this point. I have had multiple people reach out with the desire to invest. I haven’t been confident enough to sell shares to anyone I didn’t know personally. 

We are selling the first few lots of our subdivision at what we believe is a significant discount for the purpose of funding the subdivision and gaining momentum on the project. If anyone wants to purchase a lot, please feel free to reach out, and we can discuss a potential discount.

Banks in Costa Rica do not lend.

I made the incorrect assumption that as I got my subdivision approved, lenders would be available to lend to me in Costa Rica. 

The only way banks or even hard money lenders will lend here is if there are a significant number of pre-sales made. I did sell just over 20% of my equity for $850K this week, and I got a personal loan of $300K.

I will be turning around and lending $950K of that to the project. I will use the $200K to live on this year, as after I pay taxes, I will have approximately $0 in my bank account. I would be in trouble if I had to shut down my wife's Amazon purchases. It’s times like these that I’m glad my personal living expenses don’t include a boat payment.

I now have 1.35M of the 3.2M million needed in order to get the lots finished. 

We have developers on site, and they will be burning through $200,000 a month for the first 3 months, and that will become 300-400K after that until we’re finished. I will also be spending 20K a month on company costs.

This is how we set up the sales for the lots:

• 10% refundable reservation fee w/ 60-day due diligence

• 20% due after the DD period and all 30% go hard

• 40% due once utilities are stubbed (money hard immediately)

• 30% due once the buyer has full access to the lot to build a home

I will be able to use the 30% deposit once the money is hard, which will help. At some point, I may need a small loan to cover the gap to get to the 40% payment. 

What if I can’t get that loan or get enough presales?

• Option A Get another personal loan

• Option B Sell my townhome shares

• Option C Sell my Bitcoin and realize my gains

• Option D Drop the price of the lots

Overall, we are very happy about the daily progress that we’re seeing right now. It’s exciting to begin solving real world problems as opposed to fighting through government bureaucracy.