Posted by Ted Stearns on Mon, Aug 16, 2010 @ 02:04 PM
Any company worth its salt will strive to improve their products or services... or die. The Tract-PIE Team continues to invest time and capital to deliver the most flexible, easy-to-use, versatile real estate investment cash flow projection software on the market. The Tract-PIE suite of systems has been benefiting large and small real estate residential and commercial builders and land developers for more than 20 years... and we plan to continue doing just that!
We have just released the latest version of Land-PIE, version 7.6 which includes:
Budget Analysis Report:
The Budget Analysis Report presents the results from a Primary Report showing all revenues, costs and profitability by Product Type, Grand Total, Per Unit Average, Per Acre, Percent of Sales, and Percent of Cost. This report also provides some other key analytical information.
The presentation of this report has been enhanced to be much more functional in terms of categorizing cost items as Finished Lot Costs with a corresponding sub-total resulting in Gross Profit and Gross Profit Margin-%, followed by Direct Costs with a corresponding sub-total, Miscellaneous Revenues with a corresponding sub-total, and finally Net Profit and Profit Margin-%.
Flexible Identifiers for Loan Categories, Developer & Investor Equity Participants
The Purchase Note and A&D Loan categories now allow you to enter your own descriptor for each loan category if you prefer to change the default descriptor. The Miscellaneous Loan category has always required that you enter your own title to identify the loan (if used). Also, the default descriptors for the Equity Participants (Developer and Investor) may be modified if desired. Maximum Report Periods Expanded to 360
The maximum number of report periods has been expanded from 240 to 360. Report periods may be designated as months, quarters or years. When a report is displayed in the report grid, a menu bar item is presented that allows you to present quarterly or yearly periods for a monthly report or yearly periods for a quarterly report.
Report Presentation Enhancement
Report presentation has been enhanced in that values that represent percentages (i.e., interest rates, discount rates, internal rate of return, (%) of sales, (%) of cost, etc.) are now shown with a percentage sign.
Improved Menu Bars for System Navigation
All information prompting forms now provide a menu bar selection that allows you to immediately return to the Main Menu whereas certain forms previously required you to advance to a prior or subsequent form in order to exit to the Main Menu.
New Analysis Metric – “Equity Multiple”
An important metric for investors to consider is known as the Equity Multiple. This is a ratio calculated as the Total Distributions for the Equity Participation divided by the Maximum Equity Advanced Balance. Land-PIE displays the Equity Multiple for the total equity participation and for the Developer and Investor equity participation on both the Primary Report and the Executive Summary Report.
Flexibility, ease of use and on-going enhancements, coupled with responsive Customer Support are what make the Tract-PIE suite of systems the software of choice for successful homebuilders, land developers, lenders and investors in these challenging times.
Posted by Ted Stearns on Mon, Aug 16, 2010 @ 01:46 PM
Tract-PIE and Land-PIE are great for forecasting the feasibility of new projects. But how effective are they for projecting cash flows for existing projects and taking into account actuals? Bill Haycraft, a financial analyst with McGuyer Homebuilders, Inc. contacted us recently about that question and then couldn’t believe how easy and powerful the process was in providing quarterly reports to management and investors. 
Bill basically exports expense data from the company Job Costing system to a spreadsheet. He then uses PivotTables to summarize the data into quarters and specific expense categories that he has in Land-PIE. The new data is then exported to a .csv (comma-separated value) file and easily imported to Land-PIE. He also receives updates from project managers for revisions to expense budgets and then re-projects the cash flows to provide new forecasts along with Budget Variance reports.
According to Bill, “It really slick and saves a lot of time! It also avoids a lot of possible mistakes by have to manually input actuals.” Land-PIE has provided us with a consistent, disciplined system that pulls all of our data together to give management and investors timely, accurate reports of where we’ve been and where we’re going and what the returns are”, he says.
Another key way that Land-PIE has helped them was when they were approached by various investment funds to participate in some of their deals. Bill was able to take selected, individual projects and consolidate them numerous ways to structure the optimal mix of projects for a portfolio. “Doing that consolidation and reporting in a spreadsheet would have been a nightmare” he says. “It was a snap in Land-PIE.”
An experienced spreadsheet user, Bill is very knowledgeable and discerning regarding how best to use the tools that are available to him, which is why he uses Land-PIE for his financial analysis and reporting requirements.
Posted by Ted Stearns on Thu, Aug 05, 2010 @ 01:32 PM
Rick McCann, CFO of Southern Home Builders, Shreveport, LA, purchased Tract-PIE about a year ago… but alas, it gathered dust on the shelf amidst the doom and gloom of a discouraged industry. Recently, however, Rick was willing to re-commit to learning Tract-PIE with a quick training session using a deal he was involved with. And what a deal!! 
The deal involved 44 Executive Office Condominiums, each ranging from 1,225 to 4,900 SF in 4 – 5,000SF buildings. Pre-construction pricing began in the low to mid $250s. Quickly analyzing the deal in Tract-PIE was a snap and really opened Rick’s eyes to how easy Tract-PIE is. He confessed that “trying to learn a new system is always intimidating and time-consuming but Tract-PIE was incredibly easy!”
What’s exciting for Rick is that this and similar deals pencil out at about a leveraged IRR of over 200% with a Profit Margin about 38% with a short duration, start to finish, of less than 2 years. And with a slowly improving economy, proximity to large residential communities and a growing desire for small ownership versus rental, he’s optimistic about the future of similar projects.
“I’m definitely going to be using Tract-PIE to analyze similar projects because I firmly believe that we have found a perfect product at a great price for these times”, says Rick!
Maybe there are similar projects that you can take advantage of in your area too!
Click here to learn more about Rick’s project.
Posted by Ted Stearns on Thu, Jul 08, 2010 @ 04:45 PM
With banks not actively lending on real estate projects, investment firms like Sunwood & Associates are very busy analyzing and evaluating all the deals that are submitted to them. That’s why Tract-PIE has been so important to them – to analyze potential deals quickly, filter out the viable deals and concentrate on the best ones and then optimally manage them over their life-cycle.
“Receiving an initial submission in a spreadsheet is typical, but we rely upon Tract-PIE to more accurately forecast revenues and expenses and structure the deal to make it a win-win situation”, says President Erendira (Eri) Cervantes. “Obtaining a cash flow
projection already in Tract-PIE or working with a partner using Tract-PIE sure makes the evaluation and monitoring process that much easier and faster. And the fact that they are using Tract-PIE makes us more comfortable that the projections are correct”, she adds.
Under the experienced leadership of Don Knox, Don Faye and Erendira Cervantes , Sunwood & Associates is a privately held real estate investment firm that specializes in acquiring desirable real estate properties that will deliver solid returns on investment for their partners and associates. These purchases often represent residential land parcels where the hard and soft costs of the properties exceed their present market value. Sunwood primarily targets its acquisitions across the western region of the United States — including California, Colorado, Arizona and Nevada.
The Sunwood & Associates team offers over 70 years of collective real estate and business experience. Throughout their careers in finance and real estate, the partners have amassed exceptional expertise encompassing:
- Executive Investor Management
- Executive Developer Management
- Executive Bank Management
- Commercial Experience
- Acquisition Management
- Private Placements
- Strategic Planning
- Equity Raising, Foreign and Domestic
- MAI Appraisers
- Lending Experience
At Sunwood & Associates, they take pride in maintaining the highest ethical and professional standards with their partners, lenders, jurisdictions, consultants and associates. They value the relationships that are established, and recognize the importance of integrity, trust and responsiveness in ensuring successful, mutually beneficial transactions.
They also value
Tract-PIE service and support… because in a fast moving industry such as real estate capital funding, you need the flexibility to handle every twist and turn that comes your way in a very competitive marketplace.
Tract-PIE delivers big time!
Posted by Ted Stearns on Wed, Jun 30, 2010 @ 04:54 PM
In the midst of the profit and lavish spending that dominated the first part of the new millennium, excess certainly dictated almost every aspect of our lives. It is probably a safe argument to say that excess is what tipped the scales and paved the way for our present recession. In hind sight, character, in many cases, is what was lacking when it came to home building and purchasing; building what the consumer wanted, but couldn’t afford.
While many companies fell hard and failed to provide for their employees, some finished well. One such company was Kimball Hill. In our interview with former Kimball Hill employee and current CFO of the Harmony Homes family, Jim Hunt, “it is character”, he expresses, “that one carries with them out of the rubble and into the next viable, honest opportunity.”
Started after WWII to provide affordable housing for returning vets, Kimball Hill Homes had a desire to “sell homes people could truly afford.” And they did, for over 50 years. While they stayed true to their intentions, eventually a few poor decisions led to the company folding, but not before bills were paid and their doors closed with their integrity intact. They finished well. Jim Hunt knows that “you take your reputation with you and an excellent one is a badge of honor, especially in a rebounding economy.”
His character and the attributes that made Kimball Hill a standard in real estate development, remain with him as Harmony Homes seeks to build affordable housing in the hurting Las Vegas market. To help them “remain realistic” in their building projects, the Tract-PIE system is an everyday tool of their trade.
“Tract-PIE was a Kimball Hill standard for land development financial analysis and remains one at Harmony. We have people using it daily,” states Hunt as he goes on to explain the many ways this program can be used and adjusted to meet their needs. “It’s not only used for assessing potential acquisitions, but to analyze current projects, to keep us aware of cash requirements and profitability.” Harmony Homes has had Tract-PIE customized to make their reports even more understandable to those involved at all levels of a project, especially potential investors, “The new formats appeal to those buying in and the existing consolidation feature is amazing; it keeps things in line,” he continues.
“With our small staff, we’re able to quickly do a “sniff” test to determine the potential and viability of the proposed land development / homebuilding project. Those deals that pass the initial testing go through a much more extensive financial analysis and are then consolidated with other projects to determine the best mix of projects for us.” “Tract-PIE has significantly reduced our risk involved with these projects and has enabled us to provide the best return to our company and investors.”
Above all, as the market begins to turn around, Hunt says that through the combined use of cutting edge programs and classic integrity, they want to show potential buyers that they have discipline. They have learned from the mistakes that caused our present recession and want to provide the public with quality housing that is truly affordable.
Posted by Ted Stearns on Thu, Jun 17, 2010 @ 08:08 PM
Jim Zimmerman, General Manager - Land, of McGuyer Homebuilders, Inc. of Houston made available the Press Release below about their formation of a joint venture partnership with Wheelock Street Capital to purchase and develop lots for eight communities in Texas.
What Jim felt was noteworthy was that all the financial proforma analysis was generated using Land-PIE. According to Jim, "Land-PIE enabled us to respond quickly and confidently to the due diligence requirements of Wheelock." "The flexibility of Land-PIE to structure all the waterfalls for profit distribution allowed us to look at all types of scenarios for structuring distributions from the new joint venture." "Attempting to do the same thing in a spreadsheet would have taken much longer and the potential for errors was greater."
Their use of Land-PIE will now be expanded to not only use this real estate investment analysis software to analyze potential projects, but to also provide regular periodic reporting to the venture. Actual revenues and expenses will be imported automatically to Land-PIE from their job costing system to produce the required quarterly updates to the budget and capital plan.
"Land-PIE, with their responsive customer support, is an integral part of the future of this company."
Press Release
McGuyer Homebuilders partners with Wheelock Street Capital
Houston, TX (April 19, 2010)... McGuyer Homebuilders, Inc. ("MHI") of Houston, Texas today announced the formation of a joint venture partnership with Wheelock Street Capital to purchase and develop residential land for lot sales and homebuilding. Together, they recently closed on their first transaction, which included the acquisition of over 3,000 homesites across eight communities in Texas originally from lender GMAC / RFC. The all-equity investment totaled over $15 million, and is the first of what both firms expect to be a growing relationship. Together, the firms will seek to acquire single assets, portfolios and other homebuilders with the goal of investing in excess of $50 million.
The eight communities are located in Austin, Dallas and Houston. The diversified portfolio will include product for buyers ranging from first time buyers to second time move up buyers. MHI will manage the land development responsibilities. Both firms will work to market the homesites for sale to homebuilders.
Commenting on the announcement, Frank McGuyer, Chief Executive Officer of MHI said, "We are excited about the relationship with Wheelock. Their experienced team understands our business, and we've learned that we share similar acquisition and development philosophies. The formation of this venture will allow us to take advantage of some of the great opportunities we are seeing in our markets right now, leveraging our knowledge of the Texas markets with the capital backing of Wheelock. We expect this to be the first of many key acquisitions."
Jonathan Paul, a Managing Partner of Wheelock Street Capital added, "We couldn't be happier about our choice of partner. We are bullish on the major markets and believe MHI has a premier land development and homebuilding platform. Throughout the process their team has been exceptional. The residential land sector is one of Wheelock's areas of investment focus, and we are looking forward to future opportunities with MHI."
Established in 1988, McGuyer Homebuilders, Inc. (MHI) is a Houston based company with over 37,000 homeowners. The builder was recently ranked as the #1 Largest Houston area Homebuilder by the Houston Business Journal, and has been ranked in the top 30 in the nation by Builder magazine. MHI offers homes through it signature brands Pioneer Homes, Plantation Homes, Coventry Homes and Carmel Builders. For more information, visit McGuyerHomebuilders.com.
Wheelock Street Capital, L.L.C. is a real estate private equity firm founded in 2008 by Merrick R. Kleeman and Jonathan H. Paul. Wheelock Street pursues a highly focused, fundamentally-driven investment strategy. Backed by established institutional capital, the Company is currently pursuing acquisitions and recapitalizations of real estate and operating platforms in the hospitality and residential land/homebuilding sectors.
Posted by Ted Stearns on Wed, Jun 02, 2010 @ 01:19 PM
Funding is tight in the current economic environment but there are still many sources for financing that are available with the right project. Mountain Funding, below, might be the source of funding for your next land development or homebuilding project. We publish this information to assist you to find capital for those deals that need professional, responsible, timely funds. The Tract-PIE suite of software systems can assist you in quickly analyzing a land development financial feasibility analysis of projects. If you would like us to publish information about your company and how you can serve the industry, please contact us at 800.774.5077.
Charlotte, N.C.-May 3, 2010-Mountain Real Estate Capital, the newly formed acquisition and investment affiliate of Mountain Funding, is pleased to announce the recent closing of its first five opportunistic acquisitions:
- $75 million equity partnership with GL Homes of Florida to acquire assets from a major financial institution. The strategic partnership allowed GL to recapitalize seven different partnerships involving 8,300 acres and 6,500 home sites, plus capital for completion of additional lot inventory. Potential sell-out in excess of $1.8 billion over an eight-year period. Closed within 27 days.
- REO purchase of a portfolio of 56 residential communities in the greater Atlanta area from Bank of North Georgia. The plan is to build out the larger projects in a joint venture with builder partners, and sell the remaining projects. Closed within 30 days.
- Equity joint venture with GreenPointe Communities of Florida to purchase, develop and sell two subdivisions located in Jacksonville. Closed within 20 days.
- Purchase of non-performing loan secured by an 80,000 square foot commercial building in South Carolina. Closed within 14 days.
- REO acquisition of 1,200 acres in southwestern Florida entitled for 1,000 dwelling units. Closed within 27 days.
Mountain Real Estate Capital is the equity investment arm of the Mountain Real Estate Group. Other affiliates include its lending group, Mountain Funding, LLC, and its management and special servicing group, Mountain Asset Management, LLC. The new investment entity is focused on three types of investments:
- Acquisition of bank REO and NPL portfolios
- Acquisition of opportunistic assets for its own account or in partnership with developers
- Joint ventures with national and regional homebuilders to develop and sell residential lots and houses.
Industry veterans Peter Fioretti, CEO; Arthur Nevid, CIO; Joel Kaul, Managing Director; and Kevin Mast, CFO; head the company. Each has more than 20 years experience in real estate investment, development and management.
"We've been a leading private capital provider since 1993, focusing on value-added residential and commercial opportunities," said Fioretti. "But in the current environment, our focus is entirely on acquiring assets at distressed values, and providing equity capital in joint ventures with select developers and builders.
"Our underlying focus is relationships, relationships, relationships. We pride ourselves on being extremely responsive to our partners and sellers, and are generally able to close transactions within 30 days. We will invest with select real estate companies who have a track record in significantly enhancing value of their properties through entitlement, re-design, developing land or building houses."
The Mountain Real Estate Group, headquartered in Charlotte, N.C., has origination and management offices in most major regions of the country. Many of its professionals joined in 2009 from GMAC-ResCap's Business Capital Group, where they were responsible for the management and disposition of well over $2 billion of land and development assets. Today, Mountain's team is involved in the ownership or management of over $1 billion of property throughout the U.S.
"I believe there are several things that differentiate us from other opportunity funds," said Nevid. "First, our equity fund is organized to invest $1 billion, allowing us to close very quickly as opportunities arise. Second, our principals are all experienced as real estate owners and developers, allowing us to quickly assess and approve even the most complex projects or financial structures. Additionally, we have broad collective knowledge of all major markets and property types."
Kaul, who manages the origination effort for Mountain Real Estate Capital, headed up the group of professionals who came over from GMAC-ResCap. Other senior personnel in this group include Tom Mahathirath, Lance Franklin, Tom Orradre, Brian Clauson and Tom Clement.
"Our group agreed to join Mountain in 2009 based on its reputation as a dynamic and aggressive capital source at a point in the cycle which we felt would be rife with opportunity," said Kaul. "We believe we bring strong experience and a network of developer/builder partners that greatly enhance Mountain's investment program, and we expect to continue the success of our recent closings. Our focus with our developer/builder partners has shifted from restructuring and paying off debt to moving forward on new equity investments."
Posted by Ted Stearns on Wed, Jun 02, 2010 @ 01:15 PM
We were recently contacted by someone who wanted to evaluate our Tract-PIE financial analysis system for a proposed Midwest residential project. As we connected our PCs (me on Windows, him on a Mac) and began the live demo by inputting his "real life" assumptions, I started to sense naivety and a lack of seriousness with this prospect. The project involved more than 100 homes on partially developed property (to be actually purchased in a week at auction!!), but it became apparent that not much thought had been put into the accuracy and detail of the assumptive parameters... even going through what we call the Quick Feasibility (back of the envelope) module. Trying to make the presentation as worthwhile as possible, we probed deeper regarding the assumptions, the experience of the builder and the knowledge of the individuals who would be advising this person.
After comments such as "the family has been in real estate for years" and "we've done lots of projects on a handshake and didn't need anything this detailed", I quickly realized this prospect was living in a completely different world. This was then confirmed when he shared that "he was bored and wanted to sign-off and get together with the boys for a beer!"
Why share this story? While marketing and supporting our financial analysis software for more than 20 years, we have never encountered such a response from anyone! We have found, without exception, that those who endeavor to be successful in this industry are hardworking, passionate about what they do, willing to make sacrifices to accomplish prudent goals, are realistic (for the most part) about the expectations of lenders, investors and homeowners and are open to using the most efficient tools available whether for construction or financial analysis purposes.
It has been a distinct pleasure supporting the real estate industry with our financial, feasibility analysis software and we're proud to be associated with those who work in, support or serve the industry. I praise you for your consistency and courage as you labor in these challenging times. I also wish this unrealistic prospect good luck - he's going to need it!
Posted by Ted Stearns on Wed, Jun 02, 2010 @ 01:04 PM
Picacho Mountain
I just got off the phone with Ruben Aguirre of Community Builders International of Las Cruces, NM. I smiled while hanging up the phone after hearing the "confessions of a spreadsheet guru"!
Prior to using Tract-PIE, Ruben had created many spreadsheet models for generating cash flow projections and doing the financial analysis for all their building projects. After using Tract-PIE for more than a year, he recounts how much easier, faster .... and more accurate Tract-PIE is compared to his prior models. Additionally, he's more efficient and able to thoroughly analyze existing projects as well as do the prudent feasibility analysis for new projects and communities.
And vital for any company, their lenders are more receptive and responsive now to their presentations because the reports are professional-looking and endorsed by their accountants at one of the best recognized CPA firms in their area.
According to Ruben, "we can present reports to our accountant and respond to their suggestions much faster and confidently than when using a spreadsheet." "I make better use of my time with Tract-PIE. It frees me to analyze a deal from more angles instead of spending my time double-checking and triple-checking formulas for errors and omissions. And when I have a question about how a feature in Tract-PIE works, their customer support calls me back the same day, and always within 24 hours."
Posted by Ted Stearns on Wed, Jun 02, 2010 @ 12:57 PM
Any company worth its salt will strive to improve their products or services... or die. The Tract-PIE Team continues to invest time and capital to deliver the most flexible, easy-to-use, versatile real estate investment cash flow projection software on the market. The Tract-PIE suite of systems has been benefiting large and small real estate residential and commercial builders and land developers for more than 20 years... and we plan to continue doing just that!
We are wrapping up the latest release of Tract-PIE, version 7.6 and I wanted to give you a sneak preview of what will be released shortly. While this is not an exhaustive list, it will provide you an expectation as to what will soon be available.
- User defined titles for all expenses
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No more being limited to pre-defined titles |
- Permits and Fees based upon different fees by plan types
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These different fees affect the profit margin of each plan type |
- 4 additional User Defined Expenses
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Combined with the above User Defined titles on existing expenses, you have many more expenses available to describe your project |
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Used to describe your unique funding source |
- Budget Analysis Report Expansion
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Now reflects expenses allocated to Lot cost, Construction cost (leading to Gross Profit), reduced by Direct Costs leading to Net Profit. Loan fees and interest are also assigned to the appropriate categories |
This Tract-PIE release is scheduled for the Summer 2010.
Flexibility, ease of use and on-going enhancements, coupled with responsive Customer Support are what make the Tract-PIE suite of systems the software of choice for successful homebuilders, land developers, lenders and investors in these challenging times.