15725 Sunset Ln, Wellington FL 33414

15725 Sunset Ln, Wellington, FL 33414

Singlefamily: 6 bedrooms , 7 bathrooms

Year built: 1980, Size: 7199 SF

Investment strategy: Rental Property

Purchase Price$ 12,900,000

Rent$ 94,572/mo

Monthly Cash Flow$ 12,349

Cash on Cash Return1.15 %

Financial Analysis

Cash on Cash Return	1.15 %
Internal Rate of Return (IRR)	1.96 %
Capitalization Rate	1.15 %
Gross Rent Multiplier (GRM)	11.37
Debt-coverage Ratio (DCR)	0.00
Operating Expense Ratio (OER)	77.87 %

Financial Breakdown

Purchase Price	$ 12,900,000
Purchase Costs	$ 0
Repair/Construction Costs	$ 0
Total Capital Needed Total Capital Needed Includes all projects costs (except selling costs). Total Capital Needed Includes all projects costs (except selling costs).	$ 12,900,000
Financing	$ 0
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 12,900,000
Cash at Closing Cash at Closing This number includes down payment and loan points. Cash at Closing This number includes down payment and loan points.	$ 0
Cash During Rehab Cash During Rehab Shows the cash amount remaining to fund the purchase and rehab/construction. Cash During Rehab Shows the cash amount remaining to fund the purchase and rehab/construction.	$ 12,900,000

Operating Analysis

Rent	$ 94,572/mo
Gross Operating Income (GOI)	$ 669,570
Total Expenses	$ 521,385
Net Operating Income (NOI)	$ 148,185
Annual Debt Service	$ 0
Cash Flow Before Taxes (CFBT)	$ 148,185
Income Tax Liability	$ -56,772
Cash Flow After Taxes (CFAT)	$ 204,957

This one has it all! A gorgeous 6Br/6Bth furnished residence with swimming pool, tennis court & top quality equestrian facilities on 16.65 acres. The riders will fall for the 20 stall center-aisle stable with 8 grooming stalls, 2 tack rooms, kitchenette, 3 studio bedroom suites for staff, 3 sets of laundry machines, 200' x 70 ' covered riding arena with lounge, oversized outdoor jumping arena and 5 acre grass grand prix riding field! Your horses will never get ring sour here! The bright and airy 7,200 Sq. Ft. residence was renovated in 2016 and boasts a stunning ground-floor master-suite with a spa-like bath. All guest bedrooms have in-suite bathrooms. The center-Island kitchen has expansive views of the pool and opens to the family room.

Purchase Price	$ 12,900,000
Address	15725 Sunset Ln , Wellington, 33414, FL
MLS^® #	RX-10707547
Listing Agent	Matt Johnson
Listing Broker	Engel & Völkers Delray Beach
Year Built	1980
Type	Singlefamily
Size	7199 SF
Bedrooms	6
Bathrooms	7

Property History

Date	Price	Change	Event
11/20/2020
7/26/2018
12/12/2013
6/6/2011
12/16/2002
4/6/2000

Annual Property Operating Data

Incomes		% of GOI
Gross Scheduled Income Gross Scheduled Income (GSI) Represents the total of monthly rents for the particular property, including the potential rents from vacant units and uncollectable rents. Gross Scheduled Income (GSI) Represents the total of monthly rents for the particular property, including the potential rents from vacant units and uncollectable rents.	$ 1,134,864
Total Gross Income	$ 1,134,864
Vacancy loss Vacancy and Credit Loss Part of the potential rental income that is lost because of unoccupied units or uncollectable rent from tenants. Vacancy and Credit Loss Part of the potential rental income that is lost because of unoccupied units or uncollectable rent from tenants.	$ 465,294
Gross Operating Income Gross Operating Income (GOI) An actual income which is expected to be collected in the property. Gross Operating Income (GOI) An actual income which is expected to be collected in the property.	$ 669,570	100.00 %
Expenses Operating Expenses Expenses necessary for maintaining the property and ensuring its continued ability to produce income (doesn't include mortgage payments or depreciation). Operating Expenses Expenses necessary for maintaining the property and ensuring its continued ability to produce income (doesn't include mortgage payments or depreciation).
Maintenance	$ 200,000	29.87 %
Property tax	$ 152,220	22.73 %
Association fees	$ 5,400	0.81 %
Property tax	$ 105,709	15.79 %
Insurance	$ 58,056	8.67 %
Total Expenses	$ 521,385	77.87 %
Net Operating Income Net Operating Income (NOI) Important measurement calculated as gross operating income minus operating expenses. Net Operating Income (NOI) Important measurement calculated as gross operating income minus operating expenses.	$ 148,185	22.13 %

Cash Flow (Year 1)

Net Operating Income	$ 148,185	22.13 %
Annual Debt Service	$ 0	0.00 %
Cash Flow Before Taxes (CFBT) Cash Flow All the inflows and outflows of cash for a certain property (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property. Cash Flow All the inflows and outflows of cash for a certain property (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property.	$ 148,185	22.13 %
Income Tax Liability	$ -56,772	-8.48 %
Cash Flow After Taxes (CFAT) Cash Flow All the inflows and outflows of cash (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property. Cash Flow All the inflows and outflows of cash (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property.	$ 204,957	30.61 %

Operating Ratios

Operating Expense Ratio Operating Expense Ratio Ratio of the operating expenses to the gross operating income (GOI). Operating Expense Ratio Ratio of the operating expenses to the gross operating income (GOI).	77.87 %
Break-Even Ratio Break-Even Ratio (BER) Another benchmark used by mortgage lenders, estimating how vulnerable is a certain property to defaulting on its mortgage if part of the rental income is declined. Most of the lenders are looking for BER of 85% or less. Break-Even Ratio (BER) Another benchmark used by mortgage lenders, estimating how vulnerable is a certain property to defaulting on its mortgage if part of the rental income is declined. Most of the lenders are looking for BER of 85% or less.	77.87 %

Financial Measures

Net Present Value Net Present Value (NPV) Probably the best measure of any investment thanks to its complexity; taking into account all future cash flows including the selling price, and it converts all these amounts to their present values using discount rate required by the investor. More information and an example on the blog. Net Present Value (NPV) Probably the best measure of any investment thanks to its complexity; taking into account all future cash flows including the selling price, and it converts all these amounts to their present values using discount rate required by the investor. More information and an example on the blog.	$ -1,707,032
Internal Rate of Return Internal Rate of Return (IRR) Rate which an investment will return over the estimated period of ownership. It is in fact the discount rate that produces NPV of zero. Internal Rate of Return (IRR) Rate which an investment will return over the estimated period of ownership. It is in fact the discount rate that produces NPV of zero.	1.96 %
Profitability Index Profitability Index Similar to NPV, also calculates with the present values of future cash flows and discount rate. It shows whether the present value of the cash flows is worth the initial investment. Good investment should be above 1.0 Profitability Index Similar to NPV, also calculates with the present values of future cash flows and discount rate. It shows whether the present value of the cash flows is worth the initial investment. Good investment should be above 1.0	0.87
Annual Depreciation	$ 375,273

Holding period of 5 years and discount rate of 5.00% were used for calculation of NPV and IRR. The rest of the financial measures are for the 1st year only and therefore don't provide such an exact information.

Investment Return Ratios

Cash on Cash Return Cash on Cash Return Ratio between annual cash flow before taxes and the total initial investment, expressed as a percentage. It does not take in account the future value of money. Cash on Cash Return Ratio between annual cash flow before taxes and the total initial investment, expressed as a percentage. It does not take in account the future value of money.	1.15 %
Return on Investment Return on Investment Very similar to Cash on Cash Return, but also takes in account appreciation of the property in the first year. Return on Investment Very similar to Cash on Cash Return, but also takes in account appreciation of the property in the first year.	4.15 %
Capitalization Rate Capitalization Rate Calculated as ratio of the net operating income and the value of the property. Capitalization Rate Calculated as ratio of the net operating income and the value of the property.	1.15 %
Gross Rental Yield Gross Rental Yield Used for a particular property or also as a market indicator when using median values of rent and house prices - counted from gross scheduled rent and initial investment. Gross Rental Yield Used for a particular property or also as a market indicator when using median values of rent and house prices - counted from gross scheduled rent and initial investment.	8.80 %
Gross Rent Multiplier Gross Rent Multiplier (GRM) Counted as a ratio of market value of the property and gross scheduled income. Gross Rent Multiplier (GRM) Counted as a ratio of market value of the property and gross scheduled income.	11.37

There is no financing selected in this deal.

This chart shows the process of accumulation of investor's equity. There is some equity created right at the beginning with the rehab/construction and later investor's equity is rising by paying off the principal of the loan and also by appreciation over the years. All the green parts is the cummulative equity belonging to the investor and the red part belongs to the lender.

Year	0	1	2	3	4	5
Operational Analysis
Gross Scheduled Income	0	1,134,864	1,157,561	1,180,713	1,204,327	1,228,413
Vacancy Loss	0	465,294	474,600	484,092	493,774	503,649
Gross Operating Income	0	669,570	682,961	696,620	710,553	724,764
Expenses	0	521,385	531,813	542,449	553,298	564,364
Net Operating Income	0	148,185	151,148	154,171	157,255	160,400
Cash Flow
Repairs/Construction	0	0	0	0	0	0
Cash Flow Before Taxes	-12,900,000	148,185	151,148	154,171	157,255	160,400
Depreciation	0	375,273	375,273	375,273	375,273	375,273
Taxes	0	-56,772	-56,031	-55,275	-54,505	-53,718
Cash Flow After Taxes	-12,900,000	204,957	207,180	209,447	211,759	214,118

Note: All amounts in the table above are in $

Resale Price Evaluation Methods

The property is sold after 5 years. Below is the resale price calculated using different methods.

Gross Rent Multiplier	$ 13,967,059
Appreciation (3.00%)	$ 14,954,636
Cap Rate (1.15%) & NOI	$ 13,947,823

Sale Proceeds

Projected Selling Price	$ 13,967,059
Costs of Sale (6.00%)	$ 838,024
Net Sale Proceeds Before Tax	$ 13,129,035

In the resale analysis we do not include any calculation for taxes that might be owed on sale of the property. The tax laws for the resale are rather complex and subjected to frequent changes.

Net Assets and Yield

Net Assets
Sale Proceeds Before Tax	$ 13,129,035
Investor Cash Outlay	$ 12,900,000
Net Assets	$ 229,035
Average Yield
Annual Net Assets	$ 45,807
Average Cash Flow (After Taxes)	$ 166,669
Average Annual Gain (After Taxes)	$ 212,476
Average Annual Yield (After Taxes)	1.65 %

This charts shows Net Present Value (NPV) when property is sold in various years, i.e. when sold in 5th year, the NPV is calculated from 5 years of Cash Flow (including the selling price) and this NPV is displayed in year 5. Optimal holding period can be estimated, using this method - when NPV is the highest. Please note that appreciation growth can change these numbers greatly. It sometimes makes sense to sell the property even before the end of the mortgage term.

Property Report: 15725 Sunset Ln, Wellington RENTAL

Property Report :

15725 Sunset Ln, Wellington, FL 33414

Executive Summary