Victorian Renovations, a start-up company, is being created to satisfy the growing demand for unique and restored vintage homes downtown Portland. The company’s initial focus is on one building at Fifth and Pearl. This building is currently being purchased. Doug Machen and Sarah Renner are the owners of the business and have extensive experience in renovating houses. They also graduated from the University of Portland MBA program. Although Doug and Sarah will do most of the work, larger jobs will be done by external contractors.
After the house is completed, it will be rented out. The income stream from the rental will pay the mortgage and finance the purchase of another property downtown. Because of the increasing demand for unique homes in the area, the property at Fifth & Pearl will likely be rented out at a premium price. This will provide substantial cash flow that will help finance future projects.
1.1 Mission
The mission of VR is to develop rundown houses in the Portland area, to improve the look and financial viability of downtown Portland, and rent those properties out to provide a stream of income for future investments. The company will develop unique homes targeting the discriminating renter who is willing to pay more for a top quality home. VR hopes to be an easily identifiable company in the real estate development market.
1.2 Objectives
The main objectives of VR are:
- To obtain investor funding to purchase and renovate a four bedroom residence on Pearl and Fifth in the Hawthorne District of Portland, Oregon.
- To complete renovations at the four-bedroom Victorian Residence and to convert it into 2 bedrooms units by October 2001.
- To rent out the residence to generate enough income to pay off the mortgage and make additional income for future endeavors.
- To purchase a second residence to be renovated immediately.
1.3 Keys for Success
The keys to success with this project are:
- To finish renovation work within the allocated time and within the budget.
- You will need to find tenants for the building either before or as soon afterwards as renovations are complete.
- To maintain an annual average occupancy rate of at least 80%