Jefferson Reserve Phase II

Both Caleb (lead of construction), and Dusten (developer) have been successfully operating in the local market for over a decade and have deep business, family and community ties in Sioux Falls.

We have executed on two premium developments in Sioux Falls (Blu on Lorraine and The Velthuis), both pre-leased to stable occupancy (95%+).

In terms of the No Frills “Reserve style” projects, we have successfully executed this strategy on three other South Dakota developments: the Reserve Flats in Brookings, Washington Crossing in Sioux Falls, and Briarwood Reserve in Sioux Falls. In addition we also have three other Reserve projects in the construction stage (on budget and on schedule) — Maple Rock Reserve and Aspen Ridge Reserve in Sioux Falls, and Bluestem Reserve in Yankton, SD.

We have dialed in construction and operations throughout the key South Dakota areas while staying far ahead of trends and evolving renter demands. It does no good to build what people wanted last year, but it takes a team of pros to build what people will want next year (and then actually deliver on it instead of miring in the typical money-pit of developer hell).

Boardwalk Wealth is a private equity firm committed to delivering an All Weather portfolio to our investors.

There are distinct advantages to seizing market share in a less certain economy. Rising rates have made it harder to qualify for a home loan. This comes on top of the existing housing shortage in the local market. Further, the higher interest rates have forced less qualified developers out of the market and (see the graphs in the section above) multifamily starts are plummeting. 

Our (successful) policy is to develop if inventory is needed, regardless of the rising or falling of interest rates. When the rates drop back down we refinance, because the price of construction is always cheaper today than tomorrow (with few exceptions).

We have 2 distinct advantages:

1. Ability to secure debt at below-market terms due to our deep relationships with local banks and locally proven business model.
2. Experienced in-house development and construction team that helps us drive efficiencies throughout the development process.

This helps us to cater to the ravenous demand while being financially prudent. 

You can sit around saying “when rates go down this, and when rates go down that”, or you can deploy capital NOW before inflation turns tomorrow into never.

Jefferson Reserve Phase II will comprise one 24-unit and two 36-unit buildings, for 96 units in this phase. The quality but no-frills wellness design reduces construction costs and allows significant operating efficiencies pre- and post-construction.

Each building will be built one after the other, leasing up as they are complete. This allows an accelerated path to cash flow during construction. The taxes and interest are typically paid from this additional income, which leaves more in the reserve account and further reduces risk.

Upon the completion of each building, the cash flow stream will be seasoned earlier versus the typical development where the entire development has to be constructed before cash flow begins. The earlier seasoning of cash flow allows for a potential earlier refinance (not included in the underwriting for conservatism).

As fiduciaries we are always striving to attain the best financial result for our invesors. While we will position the asset for an eventual sale in case we are able to secure an above-market offer, we will also pursue strategic refinances to further bolster returns.

This is especially important as the Sioux Falls market continues heating up due to the limited housing supply and favorable business climate.

We are targeting a four year hold period.

Above on this page you will find some important charts and graphics that illustrate the below points.

Favorable population growth and job growth along with supply-demand imbalances and an “under the syndication radar” baseline make the Sioux Falls metro an obvious target for the savvy real estate investor. Additionally, Sioux Falls has the lowest unemployment rate in the country. 

Beyond that, our developments here keep working, coming in on schedule, and leasing up fast. We have tons of penetration and experience in this market — all “unfair” advantages that investors can lean on.

Have you ever heard about how tourists can tell the great restaurants from the traps? They check if a place is overflowing with locals.

We have to set aside a significant portion of investment shares for local Sioux Falls investors every single time we do a Reserve project, because these locals know it’s not just “another school district” or “another up and coming area”, but are intimately aware of each little pocket of their metro and the pros and cons… and they are voting for our projects with their wallets.