Question: I have a project that I am seeking capital for, how can I present it to Sapient Funding for consideration?
Please email the following information to [email protected] If we have an interest in your project we will be in contact with you:
· Location and description of project. Include map and photos (if available).
· Pro forma
· Sources (reflecting total funding required with break out of equity capital needed) and Uses of Funds
· Proposed financing and indication of whether a commitment letter has been provided.
· Rent Roll (if existing project)
· Previous years P&L and this years YTD P&L
· If ground up development (Development Cost Schedule)
· How soon is equity capital needed?
Question: Why Invest in the Dallas Area?
Dallas is one of the most recognizable and fastest growing metropolitan areas in the U.S. — if not the world — and is considered a quasi-gateway city for investors looking for dependable, liquid real estate environments. Fortunately, despite its popularity and skyrocketing growth, Dallas is still an accessible market with lots of upside. We looked closely at the numbers to get a clearer picture of what makes this North Texas metropolis such a shining star.
Following a decade of proliferating population growth, Dallas-Fort Worth is expected in this decade to once again lead the nation’s metro areas for the number of new residents. The population of the DFW area is now the 4th largest metro area in the country, up from 6th place in 2010. In fact, DFW was only one of three metros to gain at least 1.2 million residents since 2010, along with Houston and NYC. Key Population Stats: • Dallas is home to over 1.3 million people in the city and more than 7.6 million residents in the metropolitan area. • Over the past 10 years the population of the City of Dallas grew by about 9%, according to the most recent census. • Dallas is the 3rd largest city in Texas and the 4th largest metropolitan area in the country. • Major counties in the Dallas metro area include Dallas, Collin, Denton, Kaufman, and Rockwall counties. • Suburbs around Dallas, including Collin and Denton counties and have seen their populations grow by more than 36% since 2010. • DFW could see the biggest population surge in the country this decade, with the population projected to grow by nearly 18% by 2029. • Per capita income in Dallas is $36,274 and median household income is $72,265.
While many other parts of the country are still struggling to recover, Dallas is still a job hub. In fact, DFW is the nations #1 job market thanks to solid employment gains and in-migration. As The Dallas Morning News reports, Dallas scores high in top leading labor indicators such as net migration, college degree holders, job gains and growth. Key Employment Stats: • GDP of the Dallas-Fort Worth-Arlington, TX MSA is nearly $535 billion, according to the Federal Reserve Bank of St. Louis, and has grown by more than 57% over the last 10 years. • Employment growth in Dallas-Fort Worth is 5.6% year-over-year, according to the BLS, with the metro area home to nearly 3.9 million employees. • Median household incomes in Dallas grew by over 4% year-over-year while median property values increased by more than 6% in the past 12 months. • Unemployment rate in Dallas is currently 3.9% (as of Nov. 2021) with the manufacturing, trade and transportation, professional and business services, and leisure and hospitality sectors showing the fastest signs of new growth (BLS). • Target industry sectors in Dallas include building design and construction, company headquarters and operations, food manufacturing, IT services, logistics, and telecommunications. • Baylor Scott & White Health, Texas Health Resources, Lockheed Martin, University of Texas Southwestern Medical Center, and Medical City Healthcare are the top five employers in Dallas. • Major colleges and universities in the Dallas metropolitan area include University of Texas at Arlington, University of Texas at Dallas, University of North Texas, and Southern Methodist University. • Nearly 87% of the residents of Dallas are high school graduates or higher, while over 36% hold a bachelor’s degree or an advanced degree. • Transportation infrastructure in Dallas includes four major interstate highways, two commercial airports, and several mass transit systems. • Dallas/Fort Worth International Airport (DFW) is the 2nd largest airport in the U.S. and is bigger than the island of Manhattan.
Real estate market
Dallas is ranked by the National Association of Realtors (NAR) as one of the top 10 markets in a post-pandemic environment in 2021-2022. Looking at the recent housing statistics, it’s easy to understand why. According to the most recent report from the Texas Real Estate Research Center (Nov. 2021), single-family home prices increased by over 18% year-over-year, while months inventory declined from a 1.3 to 1.0 months supply. Key Market Stats: • Zillow Home Value Index (ZHVI) for Dallas is $290,564 through November 2021. • Home values in Dallas increased by 20.0% over the last year. • Over the last five years home values in Dallas increased by over 78%. • Median sales price of a single-family home in Dallas is $360,000 according to the most recent report from the Texas Real Estate Research Center (November 2021). • Single-family median sales prices in Dallas have increased by 18.1% year-over-year. • Days on market (median) is 62 days with single-family homes in Dallas selling nearly 14% faster than one year ago. • Active listings of single-family homes in Dallas have decreased by 26.06% year-over-year. • Of the 121 neighborhoods in Dallas, Preston Hollow is the most expensive with a median home listing price of $1.7 million, based on the most recent report from Realtor.com. • Most affordable neighborhood in Dallas is Pleasant Grove where the median listing price of a home is $195,000.
Attractive renters’ market
Home prices are rising in most Dallas neighborhoods, creating one of the hottest home markets in North Texas. As the Dallas News recently reported, lower mortgage rates and feverish demand from in-state buyers and remote real estate investors are pushing home prices up by 50% in some of the most popular neighborhoods in Dallas. High home prices in Dallas, along with a growing population and thriving job market are three of the reasons why demand for rental property in Dallas should remain robust in 2022. Key Market Stats: • Median rent in Dallas is $2,360 per month for a 3-bedroom home, based on the most recent research from Zumper (December 2021). • Rents in Dallas have increased by 18% year-over-year. • Renter-occupied households in Dallas account for 44% of the total occupied housing units in the metropolitan area.
Quality of life
Real estate prices in Dallas are still surprisingly affordable, the job market is robust, cost of living is low, and there’s an amazing culture scene. Add to this the fact that Texas has no state income or inheritance tax, and it’s easy to understand why so many people and businesses are moving to Dallas. Key quality of life stats: • Cost of living in Dallas is about 50% less than urban coastal cities like San Francisco and New York, according to NerdWallet’s cost of living calculator. • Forbes ranks Dallas as the 2nd best place for business and careers in the U.S. • Dallas is among the best places to live and retire in the country, based on the most recent research by U.S. News & World Report • Culture scene in Dallas includes the Downtown Art District, Dallas Symphony Orchestra, and the State Fair of Texas which started back in 1886. • Pro sports teams in Dallas include the Texas Rangers, Dallas Mavericks, NHL Dallas Stars, and the Dallas Cowboys – rumored to be the World’s Most Valuable Sports Team worth $5.5 billion.
Fortune 500 companies
Whitacre Tower - AT&T's corporate headquarters in Dallas
Headquarters of AMR Corporation, American Airlines, and American Eagle in Fort Worth
Southwest Airlines headquarters in Dallas
Comerica Bank Tower
The following are the Fortune 500 companies headquartered in the Dallas–Fort Worth metroplex:
• 3 ExxonMobil (Irving)
• 7 McKesson (Irving)
• 9 AT&T (Dallas)
• 59 Energy Transfer Partners (Dallas)
• 68 American Airlines Group (Fort Worth)
• 128 CBRE Group (Dallas)
• 141 Southwest Airlines (Dallas)
• 181 Fluor Corporation (Irving)
• 189 AECOM (Dallas)
• 174 Tenet Healthcare (Dallas)
• 175 Kimberly-Clark (Irving)
• 222 Texas Instruments (Dallas)
• 184 HollyFrontier (Dallas)
• 183 DR Horton (Arlington)
• 206 Jacobs Engineering (Dallas)
• 251 Charles Schwab Corporation (Westlake)
• 341 Pioneer Natural Resources (Irving)
• 270 Vistra Energy (Irving)
• 464 GameStop (Grapevine)
• 425 Builders Firstsource (Dallas)
• 483 EnLink Midstream (Dallas)
• 426 Celanese (Irving)
• 491 Commercial Metals (Irving)
Other notable companies based in the Dallas–Fort Worth area
• 7-Eleven (Irving)• Advent Concept (Irving)• Alon USA (Dallas) • Alcon (Fort Worth) • Assuras (Dallas) • At Home (Plano) • The Beck Group (Dallas) • Ben E. Keith Company (Fort Worth) • Beyond The Horizon (Dallas) • Black-eyed Pea (Arlington) • BNSF (Fort Worth) • Borden Milk Products (Dallas) • Boston Pizza Restaurants (Dallas) • Briggs Equipment (Dallas) • Brinker International (Dallas) • Capital One (Plano) • Cash America International (Fort Worth) • Chief Oil & Gas (Dallas) • Chili's (Dallas) • Christus Health (Irving) • Cicis (Irving) • Cinemark (Plano) • Comerica (Dallas) • Continental Electronics (Dallas) • Copart (Dallas) • Corner Bakery Cafe (Dallas) • Chuck E. Cheese (Irving) • Crossmark (Plano) • Dave & Buster's (Dallas) • Darling Ingredients (Irving) • Dickey's Barbecue Pit (Dallas) • DXC Technology (Plano) • D-BAT (Addison) • Ericsson (Plano) • Essilor of America (Dallas) • Fairmount Food Group (Dallas) • FedEx Office (Plano) • FFE Transportation (Dallas) • Flowserve (Irving) • Fossil Group (Richardson) • Frito-Lay (Plano) • Funimation (Flower Mound) • Galderma (Fort Worth) • GAINSCO (Dallas) • Gamestop (Grapevine) • Gap Broadcasting Group (Dallas) • Gartner, Inc. (Irving) • GE Capital (Arlington) • GM Financial (Fort Worth) • Goldman Sachs (Dallas) • Greyhound Lines (Dallas) • Gutterth (Denton) • Haggar Clothing (Dallas) • Half Price Books (Dallas) • Hall of Fame Racing (Dallas) • Harwood International (Dallas) • HBK Investments (Dallas) • Hoak Media Corporation (Dallas) • id Software (Dallas) • InfoCom Corporation (Dallas) • Interstate Batteries (Dallas) • Intuit (Plano) • KidZania (USA headquarters) (Plano) • Knockouts (Irving) • Jamba Juice (Frisco) • JPMorgan Chase (Plano) • La Madeleine (Dallas) • La Quinta Inns & Suites (Irving) • Lennox International (Richardson) • Liberty Mutual Insurance (Plano) • Lockheed Martin (Fort Worth) • Mary Kay (Addison) • Match.com (Dallas) • Matrix Business Technologies (Dallas) • Merit Energy (Dallas) • Metro by T-Mobile (Richardson) • The Michaels Companies (Irving) • Microsoft (Irving) • Mohr Partners (Dallas) • MoneyGram (Dallas) • Monitronics (Farmers Branch) • MumboJumbo (Dallas) • NCH Corporation (Irving) • Neiman Marcus (Dallas) • NEC Corporation of America (Irving) • Nexstar Media Group (Irving) • Niagara Conservation Corporation (Fort Worth) • Nokia (North American Headquarters) (Dallas) • NTT Data (Plano) • The Odee Company (Dallas) • TPG Sixth Street Partners • PlainsCapital Corporation (Dallas) • Pizza Hut (Plano) • Pioneer Corporation (Fort Worth) • Primoris Services Corporation (Dallas) • Prodea Systems (Plano) • Red Mango (Dallas) • Reddy Ice (Dallas) • Rent-A-Center (Plano) • Rolex (Dallas) • Sabre Corporation (Southlake) • Salesforce (Dallas) • Sally Beauty Holdings (Denton) • Sammons Enterprises (Dallas) • ScrewAttack (Flower Mound) • Securonix (Addison) • Six Flags (Grand Prairie) • Skagen Denmark (Richardson) • Smoothie King (Dallas) • Solera Holdings (Westlake) • State Farm Insurance (Richardson) • TD Ameritrade (Westlake) • Think Finance (Dallas) • Titanium Metals (Dallas) • Topgolf (Dallas) • Torchmark Corporation (Headquarters) (McKinney) • Toyota Motor North America (Headquarters) (Plano) • Trinity Industries (Dallas) • Tuesday Morning (Dallas) • TIP TOP Services (Dallas) • Tyler Technologies (Headquarters) (Plano) • Uber Technologies (Dallas) • United Surgical Partners International (Dallas) • Verizon (Irving) • Wingstop (Dallas) • XTO Energy (Fort Worth) • ZTE (USA headquarters) (Richardson) • HotelPlacer.Com (USA headquarters) (Dallas)
Question: Why invest with Sapient Funding?
For over 40 years investors have trusted Robert Cannon (Sponsor and Developer) with their investment dollars. He has consistently rewarded them; typically doubling their invested capital over a 3 to 4 year period. The Sponsor has extensive experience successfully acquiring and/ or developing a wide spectrum of real estate projects as do current development partners. (see expanded information contained in PPM). Sapient typically targets projects which have the potential of generating 18% to 20% plus annual rates of return for its investors. .
Question: Why invest in commercial real estate as opposed to stocks and bonds?
Historically, real estate and stocks have been the cornerstones of wealth creation. Certainly, balance and diversification are generally a good strategy. However, stocks are currently declining in value while we are in a period of inflation and rising interest rates. Increases in construction costs and higher interest rates are having the effect of reducing the demand for single family homes, driving people toward rentals which in turn, is driving multi-family properties toward higher occupancy and higher rents. Thus, higher returns on multi-family investments. Higher construction costs and supply constraints are also contributing to supply shortages in the housing industry. On the other hand, the Dallas area in experiencing a tremendous amount of in-migration from other areas of the country, therefore, increasing the demand for housing. Rental rates have increased by roughly 21%. Multi-family investments typically provide consistent cash flow as well as appreciation and they have the advantage of being a good inflation hedge since people always need housing. As prices and interest rates rise on single family homes, people must contend with budget reductions, leading to less expensive homes or seeking rentals as opposed to purchasing. Sapient’s single family lot development is strategically focused on lots for starter homes, which are more affordable and have a larger population of buyers compared to single family homes at a higher price point. Investing with sponsors like Sapient, offer passive investment opportunities which provide investors with cash flow, thus, enabling them to enjoy their lifestyle without the management headaches and time and expertise it takes to invest without one.
Question: Why invest in CRE development projects rather than existing projects?
Due to the high demand for quality existing projects, it has become a seller's market with higher prices which have driven buyer's returns to unattractive levels. However, new business development continues to offer the potential for creating above average rates of return. As a result, investor returns in development properties are typically much higher than for existing properties. The Sponsor's current offerings are in the two most vibrant real estate segments, multi-family and single-family developments. Multi-family rents in the Dallas area increased by roughly 21% during 2021 creating tremendous increases in revenue and value increases for multi-family projects. Occupancy in multi-family properties is currently running around 98%. Single-family homes continue to be in substantial demand due to the amount of in-migration from other areas of the country, as a result of the Dallas area lower cost of living, diversified economy and quality of living. Home prices in the Dallas area increased roughly 30% to 40% during 2021 and are expected to continue to increase in value. This fact alone, makes investing in multi-family properties a wise option.
Question: What services does Sapient Provide?
Project organization and development, due diligence on each project, feasibility analysis, rent comp surveys, market analysis, competitive bidding, operational management supervision, construction supervision, development design, quarterly operational and financial reporting, investor liaison and functions as the tax partner, in addition to a large network of commercial real estate professionals to offer guidance with your real estate portfolio.
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