Harvard Grace Capital
Bond yields have been low for some time, forcing income investors to seek alternative investments for their income needs. HGCC was formed to offer investors predicable recurring income streams with the additional opportunity for capital gains.
2021 presents what may be the biggest opportunity in a generation to acquire quality assets at a discount. The Pandemic has impacted everyone; however, some businesses have fared better than others. After nearly, a year of COVID-19, some patterns have emerged as to how the "new normal" will take shape.
- People are moving back to suburbs
- Suburban office properties are in demand
- Co-working spaces are more popular than ever
- Industrial property demand is soaring due to online retail
By focusing on the 840/565 corridor HGC will opportunistically target stable projects to build an increasing recurring cash returns.
70/30 Waterfall Participation
HGCC is board managed by successful entrepreneurs. Each has their own business and real estate experiences and successes. Harvard GRace has brought this elite team together for this opportunity in time. The board will bring its collective expertise to HGCCs investment decisions.
We know the target region. We live and work here.
Harvard Grace Capital Corporation ("HGCC") will invest in real estate properties and businesses for the purpose generating recurring cash flow and capital gains. These investments will take varying forms. Likely HGCC will provide short-term equity or secured notes with equity attributes.
Since the societal changes implemented of the COVID-19 pandemic, investment firms have changed their tactics for soliciting investment capital. On CNBC, Fox Business and email blasts, investment firms have opted for general solicitation ads. these ads offer fixed returns from 9% to 16% with no opportunity for additional upside. These are essentially debt instruments with varying levels of securitzation.
HGCC's preferred stock offering is highly differentiated from other investment options by not only offering a fixed 6.5% preferred return but also a participate with 30% of the profit distributions. We estimate this will enhance the overall IRR from 6.5% to 22.5%.
Further differentiation comes from how HGCC will be taxed. Once HGCC has 100 investors, we will elect to be taxed as a Real Esate Investment Trust (REIT). A REIT is not taxable at the corporate level, as long as it distributes at leaset 90% of its income.
The REIT status also ensures no investor will have "phantom income" or have to wait for a K-1 to file their taxes. The only income reporting will be by 1099-DIV, which will be receibed by the end of Januay each year.
Harvard Grace Corporation
HGCC was formed by Harvard Grace Corporation, a company founded in 2010 by Stewart Heath CPA. Stewart is the CEO of Harvard Grace Corporation ("HGC"). HGC provides fractional C-Level executive services to multiple clients as well as general business advisory. Stewart is an experienced entrepreneur and real estate developer.
Robert Ritch is an expert in finance and consulting with distressed businesses. Ritch started his career as a Security Specialist with the US Navy. He took this experience and knowledge and began purchasing and investing in business ventures
Adrian Eddleman is the Founder and Chief Investment Officer of Eddleman and Eddleman LLC, a financial services firm based in Jackson, Tennessee. The firm serves clients throughout the country, advising them on wealth management, financial, and estate planning as well as institutional asset management.
Dan Raines is Vice President of Content of Winsome Truth, Inc., a Christian media company he co-founded. Dan also founded Creative Trust in 1989 and is currently its President. Dan won a Grammy Award as music publisher for Song of the Year mission organization in Uganda for more than thirty years
Paul M. Lucking is a seasoned executive with over 40 years of experience in B2B and B2C services and consulting. His experience includes the early days of Federal Express. He is currently providing consulting services, Fractional CIO/COO including advisory services.
Harvard Grace Capital Corporation (“HGCC”) will invest in real estate properties and businesses for the purpose of generating recurring cash flow and capital gains. These investments will take varying forms. Likely, HGCC will provide short-term equity or secured notes with equity attributes.
HGCC’s preferred stock offering is highly differentiated from other products by not only offering a fixed 6.5% preferred rate but also a participation in the profit distributions, which will enhance the returns on investment to an estimated 22.5% annually over ten years.
The Tennessee Valley
Harvard Grace's invesmtent focus is the significant growth that's occuring between Nashville, Tennessee and Huntsville, Alabama. What we refer to as the 840/565 Corridor encompasses the region between I-840, south of Nashville to I-565, which runs through North Alabama and the center of Huntsville. HGCC has identified multiple opportunites in this area and anticipates more as the region recovers from the pandemic.
Why have we zeroed in on Huntsville? Huntsville is already Alabama's second-largest city and is the state's fastest-growing as well. Likewise, the entire northern Alabama region, including Athens and Decatur, are seeing massive investments from industrial interests, creating tens of thousands of jobs. Recent projections from AL.com estimate Huntsville will be Alabama's largest city by 2028.
Both the public and private sectors fuel Huntsville's growth. A long-time Army and NASA research hub, Huntsville is home to relocated personnel from the US Army, FBI, CIA, and the NSA as well as many private sector firms that do business with these agencies.
Additionally, the regions manufacturing sector has experienced significant growth driven by Blue Origin (Jeff Bezos' rocket engine company), Facebook, Remington, Polaris and a Toyota/Mazda joint venture and many more inducstrial companies.
All of this activity has made Huntsville, and the entire Tennesse Valley, one of the fastest growing areas in the United States. Comparatively, however, this region received little attention from the tradtitional large institutional investment firms and REITs, leaving a capital void. This void creates an opportuntity.
This opportunity is the primary focus of Harvard Grace Capital!
We have chosen the Tennessee Valley first and foremost its a region we know well and have lived and worked in for many years. Second, its one of the fastest growing regions in the country but because its deemed a small market it does not get a lot of attention.
We we will focus on multi-family, office and industrial properties that are cash flowing and may need some enchancements to further optimize cash flow. We will consider any cash flowing property we believe can deliver the returns to our investors in a stable and recurring fashion.
We may consider business operations that are inextricably connected to the underlying real estate. The Tennessee Alabama state line provides arbitrage opportunties on each side.
We will pursue any opportunity that meets the parameters of cash flow generation and secured by real estate.
We will not do new development because of the cash return profile but we may take on cash flowing projects that have additional developement opportunities.
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