Proposed Recovery College
and
Residential Center & Business Center
Mission Statement :
To improve community integration and quality of life for adults with mental illness as well as those who are homeless, unemployed or incarcerated via a holistic approach that fosters strong relationships and self-esteem.
Executive Summary :
This investment proposes the development, construction and operation of a 24,000 square foot Mental Health Recovery College, a 144 one-bedroom low income housing development and businesses. This development is on 77 acres to be located at 195 Whiteway Road in Sherman, Texas.
The developer has conducted a market feasibility that suggest there is a need for 150 one-bedroom low income homes. There are over 200 homeless people in Grayson County, 20 patients exiting Behavioral Health Centers monthly without a residential care option or immediate access to a recovery program and 100 mental health inmates in the Grayson County Jail many of which do not have a residential care option or access to a recovery program. This population has a high recidivism rate with 26% having 3 or more arrests. This program with the residential care option is designed to reduce the recidivism.
This proposed development is to be constructed to the highest standards of design. It will stand apart from the other low-income developments in our community as it will be designed not only as a beautiful community but as a place where those that are broken can find healing and a path to wholeness and self-sufficiency.
The project will be setup as a Limited Partnership. A managing general partner will be a non-profit and will maintain the entire project with a property manager to manage the housing development. Limited partners are made up of investors who contribute capital for the investment. In lieu of a carried interest, the Developer will receive a fee of 5% of the total development costs. It should be noted that most, if not all fees, will be reinvested back into the project.
- This project is located in an opportunity zone which gives investors deferred taxes and tax credits on the investment.
- Choose Opportunity Zones and you can:
- Re-invest any form of capital gains.
- Defer your taxes on your original capital gain until the end of 2026
- Reduce your taxes by up to 100% on capital gains
- This means compared to a typical portfolio, you have the potential to double your after-tax profits with a Qualified Opportunity Fund
The first phase of the project will be funded by a combination of $300,000 equity capital (2%) and $14,000,000 in investments (81%) and $3,000,000 in 0% interest debt (17%) acquired through the Texas Department of Housing and Community Affairs. On the initial phase one interim construction loan, the investors will be required to secure the loan through personal guarantees. The second phase interim
construction loan will be funded in whole utilizing stabilized status in the first phase.
INVESTMENT SUMMARY:
Total Project Costs : $14,230,636
Total Cash Equity : $300,000
Total Debt : $3,000,000
Pre-Tax Annualized Cash on Cash Return : 20%
Making Dreams Real (MDR) planning and design was initiated three years ago by Arthur Horn, previous Executive Director of Four Rivers Outreach, Inc. a non-profit created by Horn in 2006, for adults with substance abuse issues. The non-profit began in a two-bedroom house, then grew to become one of the largest non-profits in Grayson County. Eighty-percent of Four Rivers’ clients also had mental disorders. Arthur Horn sought solutions. However, a pure recovery program for adults with mental disorders did not exist in the area. Horn then advocated and researched exclusively recovery models for adults with mental disorders, and established MDR as a 501(c)3 organization.
Making Dreams Real solution to this issue is a Recovery College with a complimentary residential option. The Recovery College will be housed in a 24,000 square foot facility with cafeteria, laundry, showers, auditorium/multi-purpose room, emergency beds, day room, class rooms and library/study room.
The Recovery College is about people with mental health difficulties having the same opportunities in life as everyone else. It is about a personal journey towards a meaningful and satisfying life. It is about hope, control and opportunity. It is about living as well as possible. The workshops and courses we run aim to provide the tools to make this happen, to help you become an expert in your own recovery.
Our college offers a learning approach that complements the existing services provided by Making Dreams Real and is at the heart of everything we do. Every course and workshop we offer is co-designed and co-run by trainers with lived experience working alongside students and peer counselors. Our courses are free of charge and open to:
•Supporters (careers, family and friends) of Making Dreams Real students
•People who have been discharged from Jail, Behavioral Health Centers, State Hospitals and/or Homeless
•Anyone working with Making Dreams Real as a volunteer or peer supporter
A referral from a clinician or service isn’t required to enroll at the college, although we take referrals from Law Enforcement and Medical Professionals. This includes Recovery Managers from the Department of Health and Human Services. As a student, you can choose which courses interest you or suit your needs.
As a young person in high school has their life controlled and supported by others but when they transition to college, they become responsible to manage their lives as no one tells them to get up, go to class but they must learn to manage their lives. This management includes choosing their career path and developing the strategy to obtain this goal.
Those with Mental Health issues are usually in the system which dictates to them on how to live their lives. What medicines to take, sometimes locked in a treatment center with their freedom taken away. They are like a high school student having very little or no control over their lives.
The person becomes a student and is not identified as a patient or client. The person with a counselor develops their life goals designated a Person-Centered Care Plan. The college offers classes such as how to deal with anxiety, depression, fear and a range of emotions. The path to their goals is mapped out with navigational aids for them to deal with each emotion and issue, as life is not linear but liquid and sometimes, we encounter storms and barriers that interrupt our path. A tutor (peer counselor) is provided to assist the student to address these issues and get back on course. The student is in charge and this as an evidenced based program with a 70% success rate.
Classes for GED, vocational, job training and placement, including life management with an optional a residential component are offered for the students.
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INVESTMENT GOALS AND PARTNERSHIP STRUCTURE
INVESTMENT GOALS
BUSINESS GOALS
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DEVELOPER CONTRIBUTION OF SERVICES
The Developer will contribute services to the partnership for a fee of 5% of total development costs.
DISPOSITION OF CASH FLOW/ CASH PROCEEDS
DEVELOPER’S ROLE AND RESPONSIBILITIES
The Developer will contribute services to the partnership for a fee of 5% of total development costs.
DISPOSITION OF CASH FLOW/ CASH PROCEEDS
- All cash flow from project will be distributed as follows:
- · First to normal operating expenses of the project
- · Second to normally scheduled payments of principal and interest on first lien mortgage
- · Third to an operating reserve
- · Fourth to all equity partners based on owned interest
DEVELOPER’S ROLE AND RESPONSIBILITIES
- · Research and identify conditions of marketplace
- · Conduct a feasibility study to establish economic projections
- · Find and establish a suitable site for maximum efficiency and exposure
- · Work with design and engineering consultants
- · Secure proper zoning, special use permits, platting approvals, and site plan approvals
- · Develop a cost summary and investment analysis to project future performance
- · Organize partnership and raise equity capital needed for development
- · Secure financing for interim construction and operations
- · Hire property management company to oversee day-to-day operations
MAKING DREAMS REAL, INC.
SHERMAN, TEXAS
COST SUMMARY FOR HOUSING, BUSINESS AND COMMUNITY FACILITY CONSTRUCTION
COMMUNITY OF POSSIBILITIES HOUSING DEVELOPMENT
PHASE ONE—144 HOUSE DEVELOPMENT COST $8,805,636.00
PROJECT NAME: COMMUNITY OF POSSIBILITIES BUSINESS
PHASE TWO
DATE: JANUARY 2020
BUILDING NO. 1 SQUARE FEET 40,000 COST PER SQUARE FEET $60.00
BUILDING NO. 2 SQUARE FEET 35,000 COST PER SQUARE FEET $35.00
BUILDING NO. 3 SQUARE FEET 10,000 COST PER SQUARE FEET $30.00
DESCRIPTION TOTAL COST
Building No. 1 Automotive Restoration Facility $2,400,000.00
Building No. 2 Hydroponic Gardening Facility $1,225,000.00
Building No. 3 Equine Center $300,000.00
TOTAL BUSINESSES FACILITIES COST $3,925,000.00
PHASE THREE COMMUNITY FACILITY COST $5,614,992.00
TOTAL COST OF PHASE 1, 2 & 3 AND PROPERTY $18,345,628.00
