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The Best Way to Invest in Property - A Case Study

In this case study, you can learn how Lifestyle Asset Group provides the best way to invest in property and paved the way so a family from Iowa was able to invest in a gorgeous $2,700,0000 Chatham, Cape Cod vacation property for just $470,000.

For over a decade, this family from Des Moines dreamed of owning a home on the Cape but could not justify the investment, even though they had the resources, due to the recognition that they would realistically use the property, at most, about 4 weeks per year.

They considered just renting a luxury vacation home but at $7,000-$8,500 per week, this was a very expensive option as that capital goes straight into a black hole, with no equity and never to be seen again.

The Solution

Enter a collaboration agreement with Lifestyle Asset Group, a pioneer since 2013 in a smart and sensible second home ownership, and Today Real Estate, a leading real estate brokerage on the Cape.

The Property

73 Rowland Drive is a gorgeous Chatham home, fully renovated from the studs in 2018 by Reef Builders.

Surrounded by Frost Fish Creek with water views from throughout the house and located at the end of a very private 80-yard driveway, it is a classic Gambrel style Cape home with grey and white shingles.

The owners of 73 Rowland who live in the Boston area learned of Lifestyle Asset Group’s innovative collective model for coveted second homes and retained the company to create a limited partnership offering involving the Chatham home.

Though the owners were interested in selling it outright after the extensive remodel, they were also open to retaining an interest in the property so they could sponsor family, guests or create rental income. Thus, providing a better way to own a second home.

Fast forward to March 15th, 2020:

The Iowa family, looking for a better way to invest in property, decided to acquire a 15% interest in the Chatham property through the partnership offering created by Lifestyle Asset Group. “Interests” are sold in the form of LLC shares (Limited Liability Company) and each LLC share provides reservation rights to a date-certain week. For the Iowa family, who will host family and friends in their Chatham home each year, they acquired shares that provided them with the last two weeks of July and two weeks in September following Labor Day. Under the Lifestyle Asset Group partnership offering, they will enjoy these same weeks for each year of the 8-year duration of the partnership.

The extent of the details to effectuate a transaction of this nature were all coordinated and managed by the experienced staff at Lifestyle Asset Group. For example, there was the need for the sellers to transfer the property from their trusts to a newly formed single purpose entity LLC (Lifestyle Cape Cod I, LLC) and the team at Lifestyle Asset Group helped arrange that.

A sweeping range of other critically important deliverables were executed, including title insurance, septic tank inspection under State law, a building inspection report, the documentation of the transfer of 15% of the LLC interests from the owners to the Iowa family, all managed by Lifestyle Asset Group, Today Real Estate and closing counsel, Matt Terry of Amment Klauer LLP.

On April 2nd, 2020 everything was completed.

The Iowa family owns an equity interest of 15% by investing $470,000 (property value, closing costs, reserves, et al totaled $2,950,000), their 4 weeks of 2020 vacations to Chatham are in the calendar, the owners enjoy a big liquidity event of nearly $420,000 net and they retain 85% of the property.

Lifestyle Asset Group and Today Real Estate will sell additional partnership interests for 73 Rowland until the sellers of 73 Rowland own 35% of the LLC.

From the Iowa family: “We have dreamt of owning a home in Chatham for 10 years. And now we do but in a very sensible way. I cannot stress enough how thorough, responsive and creative Lifestyle Asset Group’s staff was in this entire process and this from a former banker. Incredibly impressive. And the team from Today Real Estate was every bit as effective. Together, they made for a remarkable team”.

And from the owners/sellers: “Until recently, we did not even know the option existed for us to monetize a portion of our Chatham asset AND retain an interest that makes sense for us. Our experience with Lifestyle Asset Group and Today Real Estate was simply extraordinary. We cannot more highly recommend them for buyers or sellers of second home assets alike. They have a game-changing solution for both buyers and sellers.”

Lifestyle Asset Group now manages the 7x24 affairs of the Chatham LLC which is exactly what the LLC shareholders want: Little or nothing to do with the management of second home miles and miles from where they live.

Everyone wins.

Welcome to the new world of vacation homeownership and the best way to invest in property created by Lifestyle Asset Group and battle-tested since 2013. The company is changing how people look at buying and selling second home properties with Forbes Magazine calling it “A luxury vacation home ownership option that makes sense”.

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