Mayfair BTR — JAK F&F Equity Opportunity

What This Opportunity Is

📋 What You're Funding

JAK's Initial Development Costs — land loan debt service, property taxes, insurance, permits, engineering, entitlements, architecture, and legal fees. Your capital becomes JAK's LP contribution to the project JV.

💰 What You Get

At Construction Loan close, your investment converts to an LP equity position — pari passu (same terms, same preferred return) as institutional equity investors. Plus a 10% kicker on JAK's promote.

📅 Timeline

~6 months pre-development (capital at work, no pref). Construction Loan closes → pref begins accruing. Construction ~18 months. Stabilization and exit at ~3.5–4 years from F&F close.

💵 Minimum

$50,000 minimum investment. Capital called in 3 tranches over ~3 months. Total F&F target for Mayfair: $800,000. Allocation subject to availability.

🛡️ Downside Protection (JV §5.2)

This is not typical at-risk pursuit capital. JAK holds a contractual lien on the property. If the land is sold before Construction Closing, JAK (and therefore F&F investors) must be fully reimbursed for all Initial Development Costs plus a pro-rata share of any land sale proceeds.

🏗️ The Project

140-unit BTR community in New Braunfels, TX (~10.45 ac). JV with Novak as landowner (agreed land value $3,150,000). Institutional equity pari passu. Construction loan ~60% LTC.

Target Returns

F&F LP Estimated Returns — Mayfair BTR

F&F LP IRR

~18–22%

Estimated; slightly below project-level due to pre-dev timing

Equity Multiple

~1.7–1.9x

Over ~3.5–4 year hold

Preferred Return

8% p.a.

Accrues from Construction Loan close — same as institutional

Promote Kicker

10%

Of JAK's promote — incremental upside on top of LP return

Hold Period

~3.5–4 yrs

From F&F close to exit/distribution

Minimum

$50,000

Called in 3 tranches over ~3 months

Returns are estimates based on current pro forma. Not a guarantee. Promote kicker only materializes if JAK earns a promote (project must hit return thresholds). Consult your own advisors.

How the Structure Works

1

Pre-Development (~6 months) — No Pref Accrual

F&F capital funds JAK's Initial Development Costs (IDC): land loan debt service, taxes, insurance, permits, engineering, entitlements, architecture, legal fees. This is JAK's developer contribution.

No preferred return accrues during this phase. Capital is at work, not sitting idle.
2

Construction Loan Closes — Conversion Event

Landowner (Novak) contributes the Property at agreed land value ($3,150,000). JAK contributes the accumulated IDC (F&F money) as its capital. Construction loan closes (~60% LTC). Institutional equity fills remaining ~40% LTC. F&F capital stays in the deal as JAK's LP position — pari passu with all other equity.

⭐ Preferred return begins accruing at 8%/yr from this date.
3

Construction, Lease-Up, Stabilization (~18–24 months)

Pref accrues on F&F capital throughout construction and lease-up. JAK manages the project as Developer/Manager. No distributions during construction.
4

Stabilization & Exit (~Month 40+)

Project stabilizes. JV distributes: preferred return first → LP pro-rata capital return → promote waterfall. F&F LLC receives its LP economics plus 10% of JAK's promote as an additional kicker.

Downside Protection

🛡️ JV Agreement Section 5.2 — Contractual Lien Protection

F&F capital is protected by a contractual lien on the Property held by JAK under the JV Agreement (§5.2). In the event the project is terminated prior to construction (e.g., Novak sells the land):

(a) Novak must reimburse JAK for ALL Initial Development Costs (the full F&F investment), AND
(b) JAK is entitled to a pro-rata share of any land sale proceeds.

This means F&F investors are not exposed to total loss in a pre-construction termination scenario — unlike typical at-risk pursuit capital. This is a meaningful structural protection baked directly into the JV.

Note: Returns and recovery are still not guaranteed. The land sale price, timing, and legal enforcement all affect actual outcomes. Investors should review the PPM and consult their own legal and financial advisors.

Next Step — Request Full Materials

Andy Heard

aheard@highside-re.com | JAK Development Group

📬 Request Full PPM & Pro Forma →