UCASU Received $400,000 Construction Loan on 1st SHOC Airbnb Property

Rhea-AI Summary

UC Asset LP (OTCQX: UCASU) announced it has secured a $400,000 construction loan for its inaugural Shared Home-Office Cluster (SHOC) property in downtown Atlanta. This property, acquired for approximately $750,000, is set to be developed into 10 short-stay rental units aimed at business travelers. The estimated gross revenue post-renovation is $350,000 annually, with renovations costing between $300,000 and $400,000. The loan features a 4.25% interest rate and matures in 12 months, potentially allowing for refinancing into a mortgage upon completion.

Positive

• Secured a $400,000 construction loan to fund the SHOC property.
• Potential to generate $350,000 in annual gross revenue post-renovation.
• Innovative investment model combining home stays and business hotels.

Negative

• Loan matures in 12 months, which creates time pressure for renovation completion.
• Total renovation cost estimated at $300,000 to $400,000, which could impact profitability.

ATLANTA, July 6, 2021 /PRNewswire/ -- UC Asset LP (OTCQX: UCASU), an Atlanta-based real estate investment firm, confirms that it has received a construction loan of $400,000 on its first Shared Home-Office Cluster (SHOC) property, through its wholly owned subsidiary SHOC Holdings LLC.

This first SHOC property is located in the historical district of downtown Atlanta, directly across the street from Dr. Martin Luther King Jr. memorial, and right off a major exit of intersecting highways known as the "Downtown Connector". It was acquired for a total cost of approximately $750,000 in April, and the deal was closed on July 01, last Thursday. This property may be developed into 10 units for short-stay rental under the concept of SHOC.

SHOC is a disruptive new concept for real estate investment. UC Asset defines the concept as a residential property with each bedroom designed as an individual business lodge equipped with office capabilities. These home-office spaces can be rented out individually, mostly targeting business travelers. The company plans to sell those spaces on platforms such as Airbnb, Vrbo or through corporate partnerships.

"SHOC combines the merits of home stays (such as most Airbnb) with conventional business hotels, and is an improvement to both," boasts Greg Bankston, managing partner of UC Asset.  "SHOC offers business conveniences that current home stays lack, and provides a lifestyle charm that current business hotels fail to provide."

Bankston estimates that, after renovating the property into about 10 units of SHOC, it may generate gross revenue of about $350,000 per year in the short run. The cost of renovation is estimated at $300,000 to $400,000.

"We are grateful to receive a construction loan that will likely cover all of our construction cost. This may remarkably improve our ROE (Return on Equity) on this property," says Bankston. "The loan is provided by a local bank who had worked with us on conventional investments. Approval of this loan, we believe, shows that the bank has confidence in our new and innovative investment model SHOC."

The loan carries an interest of 4.25% per annum and matures in 12 months. If renovation of the property can be completed by the maturity date, it is possible that the loan can be refinanced into a mortgage loan of longer term, collateralized with the finished SHOC property.

About UC Asset:

UC Asset LP is a limited partnership formed for the purpose of investing in real estate with value-added strategies, concentrating in metropolitan areas of Atlanta, GA. For more information about UC Asset, please visit: www.ucasset.com 

Disclaimer:
This News Release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any these statements. You are cautioned not to place undue reliance on any those forward-looking statements. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements after the date of this News Release. None of such forward-looking statements should be regarded as a representation by us or any other person that the objectives and plans set forth in this News Release will be achieved or be executed.

For More Information Contact:

Christal Jordan | Investor Relations Director, UC Asset LP
cjordan@ucasset.com | 678-499-0297

 

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SOURCE UC Asset LP

FAQ

What is the purpose of the construction loan received by UCASU?

The $400,000 loan is intended to fund the renovation of UCASU's first Shared Home-Office Cluster property.

Where is the SHOC property located?

The SHOC property is located in the historical district of downtown Atlanta.

What is the expected annual revenue from the SHOC property?

The property is estimated to generate approximately $350,000 in annual gross revenue.

What is the interest rate on the construction loan for UCASU?

The construction loan carries an interest rate of 4.25% per annum.

When does the construction loan mature?

The construction loan matures in 12 months.