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ECI’s ocean front parcel in San Pedro contains 266 feet of direct ocean frontage. Until recently, only 3 stories were permitted on the island, but the height restriction is now set at 44’ which allows a 4th story and increases the yield potential of the property by 25%. Based on simple massing studies, the building footprint will produce 15,000 sellable square feet per floor. We estimate a maximum construction cost of $125 per sq.ft. which includes luxury finishes. For this analysis, we use the lowest comparable retail sales price which is $265 per sq.ft. This produces a profit of 140 per sq.ft. These numbers are conservative. Currently on the island, third and fourth story condominiums sell between $350 - 400 per square foot. Using the conservative $140 per foot profit number, the total gross profit on this parcel is $8,400,200 selling 60,000 sq.ft. If we are successful in offering units in line with the current market price, it would push gross profit from real state on the front parcel into the $12 - 15 million dollar range.
ECI’s off-ocean 6.5 acre parcel provides significant acreage for development. One acre of the property is developed with a club house, work out facility, 2 lighted tennis courts and the largest swimming pool in Belize. The remaining 5.5 acres will incorporate a residential community with 101 town houses averaging 1600 square feet and an additional 50 high density condos averaging 1200 square feet. Construction costs will average $100 sq/ft with high end (but not luxury) finishes. Infrastructure overhead will be limited because of the small parcel size and will include streets, sidewalks, a small park and the associated underground utilities. Costs to develop this infrastructure will add less than $10,000 per address. We estimate that our gross profit per square foot will be $90. The number of sellable square feet will exceed 220,000 sq.ft., generating a profit of $19,800,000.
By integrating both parcels, we believe that the synergies create additional value. Our experience in Nicaragua shows that New Urbanism drives values considerably higher. These two factors taken together could mean a significant increase in the projected returns. In total, we estimate the gross profits on the venture to be between $26 -31,000,000 using current conservative numbers. Net profits should be approximately 88% to 90% of these values after sales commissions and marketing costs.
