Safe and Green Development Corporation Year In Review: Property Monetization, Joint Venture Expansion, SFH Development and Institutional Investment

Rhea-AI Summary

Safe and Green Development (NASDAQ: SGD) shared its 2024 achievements and future plans. Key highlights include the $1.4 million sale of St. Mary's property to Pigmental Studios, generating $1.1 million in net proceeds. The company is developing its first phase of homes, with six units scheduled for completion by Q1 2025, projecting $1.2 million in revenue. SGD expanded its portfolio to approximately 250 single-family lots in the Rio Grande Valley through joint ventures.

The company secured a potential $10 million investment from Arena Global and regained NASDAQ compliance. SGD also partnered with Trio Residential and Allied Services Group for down payment assistance and mortgage services, while integrating technology through the acquisition of Majestic World Holdings for its proprietary portal, reav.homes.

Positive

• Strategic sale of St. Mary's property for $1.4M, generating $1.1M in net proceeds
• Pipeline of 250 single-family home lots in Rio Grande Valley
• Projected revenue of $8.0M from 40 planned homes in 2025
• Secured potential $10M investment from Arena Global
• Regained NASDAQ compliance
• Integration of mortgage services and down payment assistance to improve margins

Negative

• High interest debt requiring asset monetization for reduction

Insights

Financial Analyst

The strategic monetization efforts and expansion plans showcase a significant transformation for SGD. The sale of the St. Mary's property for $1.4 million provides important working capital while reducing high-interest debt. The company's ambitious pipeline of 250 single-family lots in the Rio Grande Valley, combined with projected revenue of up to $8.0 million from 40 planned homes in 2025, indicates substantial growth potential.

The $10 million investment commitment from Arena Global strengthens SGD's financial position and provides capital for expansion. The vertical integration strategy, including mortgage services and down payment assistance partnerships, could enhance profit margins above industry standards. However, execution risks remain as the company scales its operations and implements its technology platform.

Real Estate Development Expert

SGD's strategic pivot towards affordable housing in the Rio Grande Valley demonstrates market awareness and potential for scalable growth. The Sugar Phase I development, with its first six homes nearing completion, serves as a proof of concept for their integrated development model. The expansion into mortgage services and down payment assistance through partnerships with Trio Residential and Allied Services Group addresses key barriers to homeownership.

The proprietary technology platform through reav.homes could streamline operations and improve customer experience, though success will depend on user adoption and seamless integration. The geographic diversification strategy across Texas, Oklahoma and Georgia provides multiple growth vectors while managing market-specific risks.

Tech Analyst

The acquisition of Majestic World Holdings and integration of their technology platform represents a forward-thinking approach to modernizing real estate development. The proprietary portal (reav.homes) could differentiate SGD by simplifying the homebuying process and creating a more efficient sales funnel. The integration of mortgage services and down payment assistance into the platform suggests a comprehensive digital ecosystem that could reduce friction in the home purchasing process.

However, success will depend on the platform's user experience, backend integration capabilities and ability to scale across multiple markets. The technology investment could provide a competitive advantage if properly executed, but requires continued development and maintenance resources.

MIAMI, Dec. 18, 2024 /PRNewswire/ -- Safe and Green Development Corporation (NASDAQ: SGD) ("SGD" or the "Company"), a real estate development company, is excited to share its 2024 Year In Review highlights, including the strategic sale of the St. Mary's property, the progress of the Sugar Phase I Development, the acquisition of additional single-family lots in South Texas and the closing of multiple construction loans.

A Message from CEO David Villarreal:

"We believe we have set the stage for rapid growth on a defined path throughout 2025 and beyond. We have executed contracts to strategically monetize several of our existing land holdings, which will eliminate high interest debt to allow us to pursue our growth strategy and focus on a more targeted footprint. We have a pipeline of approximately 250 single family home lots in the Rio Grande Valley and started construction on the first phase. 

Additionally, we are integrating our technology platform to increase margins on each home sold. The proprietary platform aims to simplify the homebuying experience for the consumer and integrates mortgage services and down payment assistance. This vertically integrated approach from development through home sales is designed to be a scalable and repeatable strategy that improves margins compared to traditional real estate development. While our initial developments will be in the Rio Grande Valley, we intend to apply this strategy across our parcels in Oklahoma and Georgia. Profitable asset sales, along with up to a $10M investment from Arena Global, an institutional investor, should allow us to pursue our growth strategy."

A Transformative Year for SGD

2024 has been a pivotal year for SGD, marked by significant achievements in asset monetization and pipeline expansion. Key accomplishments include:

• Strategic Real Estate Monetization – St. Mary's Property: On November 18, 2024, SGD executed its strategy of monetizing select real estate assets by selling its St. Mary's property in Georgia to Pigmental Studios for $1.4 million, generating approximately $1.1 million in net proceeds. This transaction allowed SGD to reduce its debt and reinvest in growth initiatives.
  
  
• Developing the first phase of homes in Company History: Construction is underway on the Sugar Phase I development in Texas, with the first six homes scheduled for completion and sale by Q1 2025. This initial phase is projected to generate $1.2 million in revenue for the joint venture, with at least 40 homes planned across various projects for delivery throughout 2025, potentially generating up to $8.0 million in revenue for the Company's joint ventures.
  
  
• Single Family Home Portfolio Expansion ~ Approximately 250 Lot Pipeline: SGD entered several new joint ventures to acquire approximately 250 single-family lots across several different cities in the Rio Grande Valley. The Company's pipeline in the region now includes Sugar Phases 1 & 2 as well as Hacienda Olivia Phases 2, 3 & 4.
  
  
• Arena Global: SGD secured an investment of potentially up to $10 million from Arena Business Solutions Global SPC II, LTD  and regained compliance with NASDAQ's minimum bid price requirement, bolstering its financial stability and operational momentum.
  
  
• Mortgage & DPA Partnerships: SGD inked partnerships with Trio Residential and Allied Services Group respectively to provide down payment assistance, lease-to-own and mortgage services to prospective buyers of SGD homes.
  
  
• Technology Integration: The Company completed its acquisition of Majestic World Holdings and is leveraging the technology to facilitate purchases of SGD homes via its proprietary portal: reav.homes

Looking Ahead

With a robust development pipeline, strategic partnerships, and disciplined financial management, SGD will be well-equipped to capitalize on growth opportunities in 2025. The Company is committed to advancing its mission of delivering sustainable and innovative housing solutions.

About Safe and Green Development Corporation (SG Devco)

Safe and Green Development Corporation is a real estate development company. Formed in 2021, it focuses on the development of sites using purpose-built, prefabricated modules built from both wood and steel. The thesis of development is to build strong, innovative and green, single or multifamily projects across all income and asset classes. Additionally, a majority owned subsidiary of SG DevCo, Majestic World Holdings LLC, is a prop-tech company that has created a real estate AI Platform. The Platform aims to decentralize the real estate marketplace, creating an all-in-one solution that brings banks, institutions, home builders, clients, agents, vendors, gig workers, and insurers into a seamlessly integrated and structured AI-driven environment. MyVONIA Innovations LLC, a wholly own subsidiary, is the owner of MyVONIA which is an AI-powered personal assistant designed to help simplify daily tasks and improve productivity for individuals and businesses. MyVONIA aims to assist with managing both personal and professional tasks

Safe Harbor Statement

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended. All statements other than statements of historical fact are or may be deemed to be forward-looking statements. In some cases forward-looking statements can be identified by terminology such as "may," "should," "potential," "continue," "expects," "anticipates," "intends," "plans," "believes," "estimates" and similar expressions and include statements regarding having set the stage for rapid growth on a defined path throughout 2025 and beyond, strategically monetizing several of SGD's existing land holdings and eliminating high interest debt, pursuing the Company's growth strategy and focusing on a more targeted footprint, integrating SGD's technology platform to increase margins on each home sold, the Company's proprietary platform simplifying the homebuying experience for the consumer, SGD's vertically integrated approach from development through home sales being a scalable and repeatable strategy that improves margins compared to traditional real estate development, applying SGD's vertically integrated strategy across its parcels in Oklahoma and Georgia, effecting profitable asset sales along with up to a $10M investment from Arena Global, pursuing SGD's growth strategy, completing and selling the first six homes in the Sugar Phase I development in Texas by Q1 2025, generating $1.2 million in revenue for the joint venture in the initial phase of the Sugar Phase I development, delivering  at least 40 homes across various projects for delivery throughout 2025, generating up to $8.0 million in revenue for the Company's joint ventures, acquiring approximately 250 single-family lots across several different cities in the Rio Grande Valley through several new joint ventures, leveraging the technology acquired from Majestic World Holdings to facilitate purchases of SGD homes via its proprietary portal, being well-equipped to capitalize on growth opportunities in 2025, delivering sustainable and innovative housing solutions and creating an all-in-one solution that brings banks, institutions, home builders, clients, agents, vendors, gig workers, and insurers into a seamlessly integrated and structured AI-driven environment.

These forward-looking statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, and expected future developments, as well as other factors we believe are appropriate in the circumstances. Important factors that could cause actual results to differ materially from current expectations include, among others, the Company's ability to achieve rapid growth on a defined path throughout 2025 and beyond, the Company's ability to strategically monetize its existing land holdings as planned and focus on a more targeted footprint, the Company's ability to integrate its technology platform to increase margins on each home sold, the Company's ability to scale and repeat its vertically integrated approach to improves margins, the Company's ability to secure a $10M investment from Arena Global, the Company's ability to sell the first six homes in the Sugar Phase I development in Texas by Q1 2025, the Company's ability to generating $1.2 million in revenue for its joint venture in the initial phase of the Sugar Phase I development, the Company's ability to deliver at least 40 homes across various projects throughout 2025, the Company's ability to generate up to $8.0 million in revenue for its joint ventures, the Company's ability to acquire approximately 250 single-family lots across several different cities in the Rio Grande Valley through several new joint ventures, the Company's ability to leverage the technology acquired from Majestic World Holdings to facilitate purchases of SGD homes via its proprietary portal, the Company's ability to capitalize on growth opportunities in 2025  the Company's ability to create an all-in-one solution that brings banks, institutions, home builders, clients, agents, vendors, gig workers, and insurers into a seamlessly integrated and structured AI-driven environment, and other factors discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, and its subsequent filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof.

For investor relations and media inquiries, please contact:

Barwicki Investor Relations
Andrew@Barwicki.com
516-662-9461

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SOURCE Safe and Green Development Corporation

FAQ

What is the expected revenue from SGD's Sugar Phase I development in 2025?

The Sugar Phase I development's first phase is projected to generate $1.2 million in revenue for the joint venture, with potential total revenue up to $8.0 million from 40 planned homes throughout 2025.

How much did SGD sell the St. Mary's property for in November 2024?

SGD sold the St. Mary's property in Georgia to Pigmental Studios for $1.4 million, generating approximately $1.1 million in net proceeds.

How many single-family home lots does SGD have in its pipeline?

SGD has a pipeline of approximately 250 single-family home lots across several different cities in the Rio Grande Valley.

What is the size of Arena Global's potential investment in SGD?

Arena Business Solutions Global SPC II, committed to a potential investment of up to $10 million in SGD.

When will SGD complete its first homes in the Sugar Phase I development?

The first six homes in the Sugar Phase I development are scheduled for completion and sale by Q1 2025.