There are two separate but interconnected investments, PEI – Cannon Ranch & PEI – Cannon Ranch 1b.
PEI Cannon Ranch is the residential project. We acquired bank-owned land entitled for 4200 residential lots for $16M that had been in escrow for $160M in 2006. The former buyer fell out of contract when the market collapsed so the owners filed bankruptcy and the property went back to the bank. We partnered with two NY hedge funds (who bought in for 90% and we own 10% of the project). The business plan is to finish the Final Map, and then sell lots in bulk to builders starting in 2016.
We changed the name of the community from Cannon Ranch to the Mirada and changed the amenities from a golf course to a water community, using Crystal Lagoon technology. The development is located just 30 miles Northeast of Tampa, FL.
PEI Cannon Ranch 1b is 29 acres slated for commercial use, adjacent to the residential development. Our group purchased the land for $1.2M (it had sold for $6.5M in 2004). We are holding this land until construction on Mirada begins, which would increase the need for commercial property (namely a grocery store).
You can learn more about the project below, and also review the updates. We are allowing a very limited number of new investors to participate, while replacing some older investors who needed to exit at this time.
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Below is your project updates for PEI Cannon Ranch LLC & PEI Cannon Ranch 1b LLC
PEI-Cannon 1B LLC, the Commercial Project:
The Purchase and Sale Agreement for Phase 1 of the Commercial Site (14.8 acres of 28 Acres) was amended and restated September 2018. The PSA provided for a contingency for the approval of the Site by the Publix Market Real Estate site committee, originally to be removed by December 2018, this date was subsequently extended to February 2019. The Site was approved by Publix with conditions acceptable to buyer on February 27, 2019. The Buyer has removed the contingency and released the $100,000 deposit to Seller! In addition, the Buyer has now contracted with his consultant team, (Architect, Civil Engineer, Soil Engineer) at Budgeted expenditures of $350,000.
The buyer now has 180 days for the Site Permitting Approval which takes us to September 2019, with Closing of the Phase 1 anticipated in November 2019!
Based on the $3,868,000 Phase 1 Purchase Price in November of 2019, an initial $50,000 original Investment estimated financial projections are earned $82,250. (preferred return @15%) Net Proceeds from Phase 1 Sale should return 100% of Original Capital and 78% of preferred return ($64,238. Based on $50,000 Investment).
As soon as Phase 1 closes we will begin marketing Phase 2. The phase 1 Buyer is most likely candidate but has no contractual control. IF Phase 2 were to sell at the SAME $ PSF as Phase 1, the Financial results for the Original $50,000 Unit would be the Payment of the balance of the Preferred Return owed ( $18,000 )plus the 12.5% equity participation estimated at $12,300.
PEI Cannon Ranch LLC, the Residential Project:
Lennar JV/ Active Adult:
Phase 1 Land has been contributed by CR Pasco Investors, LLC to the Lennar Active Adult JV per the Agreement. The Active Adult Clubhouse Agreement is in negotiation. The Lennar Active Adult Models are scheduled to be started this month.
Phase 1 Roads: Mirada Blvd to the Lennar Active Adult lots, SR 52 intersection, Kenton Rd to Active Adult and Setter Palm all are completely paved. Landscape and hardscape are in progress. Lagoon: Under Drain and earthwork are complete, construction progressing on balance of Lagoon with completion estimated 3rd quarter 2019.
Lot Deliveries & Lat Sales:
Lot deliveries were delayed due to a design change in the water system by Florida Department of Transportation. Phase 1 Lot Deliveries ( Parcels 16 – 22 ) now projected for April 2019 (originally December 2018).
Lot sales: We remain in negotiation on Parcels 2 – 6 with Kolter. No signed contract as of now. Not aggressively pursuing other Lot contracts at this time, wanting to wait for existing builder Model Delivery and completion of the Crystal Lagoon.
All builder “Now Selling” signs are up, plus some “Crystal Lagoon coming soon” signage and Mirada Sale Flags are up. A Mirada billboard has been selected on the Interstate in a high volume traffic location in downtown Tampa. This will start in April.
No financial updates have been prepared since our November Update. Should have Update in June.
Fred Bates and Tom deRegt are scheduled to visit Tampa for site inspection, meeting and site tour with Metro Development, and meeting with the Buyer of Parcel 1B. We will discuss this visit in our next update.
Thank you for your continued support as we move to the next Phase of this exciting project! Lot Deliveries, Model Homes and Home Sales!
If you have any questions, please email them to Syndications@