65
Full-hookup RV pads ($75/nt ADR · count ESTIMATE, field verification pending)
9.074 acres · Jarrell TX · I-35 Exit 275 · C-2 Zoning
13|7 Capital LLC · Construction: 13|7 FrameWorks LLC
The 65% LTC structure is sized on the honest all-in basis of $18,231,312 (incl. expected environmental). The retired v3.1 $14.98M model is held only as an audited reference.
| Item | Senior Debt (65% LTC · Canonical) |
|---|---|
| Basis for LTC (honest all-in) | $18,231,312 |
| LTC percentage | 65% |
| Senior debt | $11,850,353 |
| Equity (35%) | $6,380,959 |
| Interest rate | 7.5% |
| Amortization | 25 yr |
| Annual debt service (P&I) | $1,050,877 |
| DSCR stabilized (Base P50 NOI $2,360,404) | 2.25× |
| DSCR Year-1 lease-up | 0.79× ⚠ 12-mo interest reserve required |
Year-1 NOI (~$826K) does not cover annual debt service of $1,050,877 (DSCR ≈ 0.79×). A 12-month interest reserve (~$1.05M) must be funded at close. Stabilized base coverage of 2.25× at Year-3 confirms the deal is bankable. Full year-by-year DSCR schedule in Section 07 Treasury.
| Land acquisition (non-depreciable) | $2,530,000 |
| Hard cost ex-land (GC contract value) | $11,585,000 |
| Realistic soft costs (design, fees, financing, carry, contingency) | ~$3,341,312 |
| Expected environmental (TCEQ WWTP + detention) | included above |
| Owner all-in basis (honest · re-underwritten) | $18,231,312 |
Honest basis folds previously un-budgeted environmental into the number; the ex-environmental floor is $17,456,312. Land ($2,530,000) is non-depreciable; the depreciable basis (land carved) is $12,453,875. The NNN retail component is deferred to a Phase 4 refinance and is not built or capitalized in this deal.
The lazy river is a free-form natural-pool build: a public S-loop main river (day-pass float) plus a private cabin-crescent branch (guest-only), with swim-in grottos, waterfalls, natural pools, two engineered 2-person net swings (PE-stamped over verified water depth), and multiple Airstream food/drink stations at float stopping points. The day-use gate is the diversification thesis · the water park pulls non-guest revenue that needs no bed sold.
Source: RoverPass 2026, Innowave 2025, SBA 504 resort ramp benchmarks. Stabilization in Year 3 assumed throughout the financial model.
NPV disclosure · re-underwritten single-option model (2026-07-31), opex re-based to 50% of EGR. Base case (P50 revenue, 8% cap): levered IRR 24.8%, unlevered NPV@12% +$5,974,311. Downside (P25 revenue, 9% cap): levered IRR 11.0%, DSCR 1.46×, NPV@12% −$3,365,173 (negative · disclosed honestly; debt still covered at 1.46×). Upside (P75 revenue, 7.5% cap): levered IRR 33.6%, NPV +$14,840,530. The retired v3.1 model used a 40.8% opex ratio that sat below market; published glamping / cabin-lodge benchmarks show NOI margins of 40–60% of EGR (RoverPass 2025; Loan Analytics 2025; MMCGInvest 2025), so 50% opex is the conservative base and 40.8% is treated as the upside. A formal HVS / CBRE / STR benchmark on a comparable Texas I-35 corridor property is required before lender submission to replace the assumption with a sourced figure. This disclosure is required in every PPM, investor presentation, and lender package.
| Scenario | Gross Revenue (EGR) | Stabilized NOI | NOI Margin |
|---|---|---|---|
| P25 Downside (9% exit cap) | ~$3,068,858 | $1,534,429 | 50% |
| P50 Base Case (8% exit cap) | ~$4,720,808 | $2,360,404 | 50% |
| P75 Upside (7.5% exit cap) | ~$6,243,060 | $3,121,530 | 50% |
NOI figures are the re-underwrite (50% opex base). Gross revenue (EGR) is shown as the implied stabilized figure at exactly 50% opex (EGR ≈ 2× NOI) and is directional pending the engineered HVS/CBRE/STR opex study. Revenue mix: 65 RV pads, 30 river-sited cabins, lazy-river day-gate admission + F&B, Full Moon venue events + concert series, Koh Tao, golf, splash pad. Yield-on-cost at base is 13.0%.
| Discount rate | P25 Downside | P50 Base | P75 Upside |
|---|---|---|---|
| 12% (Damodaran hurdle · canonical) | -$3,365,173 | +$5,974,311 | +$14,840,530 |
CFA note: the 12% hurdle follows Damodaran 2026 (Rf 4.18%, ERP 4.23%) with β=0.90 for unleveraged private hospitality with contractual RV income plus a ~2.0% development-stage premium (NYU Stern dataset, data as of Jan 1, 2026). The P25 downside NPV is negative (−$3,365,173) and is disclosed honestly · debt is still covered at a 1.46× DSCR in that case. The 8% exit cap sits at the aggressive end of the 2026 7–10% range; a 7/8/9/10% exit-cap sensitivity shows the base case holds.
| Metric | P25 Downside | P50 Base | P75 Upside |
|---|---|---|---|
| Levered IRR | 11.0% | 24.8% | 33.6% |
| Equity multiple | 2.64× | 6.39× | 9.97× |
| Stabilized DSCR | 1.46× | 2.25× | 2.97× |
| Unlevered NPV @ 12% | -$3,365,173 | +$5,974,311 | +$14,840,530 |
Exit disposition tax (Year 10) is estimated at ~$5,866,384 (§1245/1250 recapture + LTCG). Exit cap sourced: Houlihan Lokey, RoverPass, Innowave. NIIT and state tax not modeled. Year-1 lease-up DSCR ≈ 0.79× across scenarios · a 12-month interest reserve (~$1.05M) is funded at close.
| Revenue Line | Status | Note |
|---|---|---|
| Day-use gate + concert-series revenue | ESTIMATE | The diversification thesis · admission + F&B + concert tickets pull non-guest revenue with no bed sold. Underwrite the gate/concert count before lender submission. |
| Full Moon venue events + F&B | EVENT-DRIVEN | Booking risk; underwrite separately before lender submission. |
| ADR $175/nt cabins · $75/nt RV (P50) | SOURCED | RoverPass 2026, LHTX Resort, Stanford Ranch · defensible for I-35 corridor. |
| Opex ratio 50% of EGR (P50 base) | CONSERVATIVE | 50% is the conservative base (40–60% glamping/cabin benchmark); the retired v3.1 40.8% is treated as upside. Engineered HVS/CBRE/STR study replaces the assumption before lender submission. |
| RV pad count (65) | ESTIMATE | Requires field verification vs site plan. Revenue scales proportionally with confirmed count. |
| Texas HOT (state 6% + city TBD) | CONFIRM | City of Jarrell rate unknown; combined up to 13%. HOT is pass-through · confirm ADR is net-of-HOT. |
| Asset Class | Basis | Treatment |
|---|---|---|
| 5-yr MACRS (20% · FF&E, sims, EV, tech, cabin chassis §1245) | $2,490,775 | 100% bonus Yr-1 |
| 15-yr MACRS (45% · lazy river, parking, courts, turf, site) | $5,604,244 | 100% bonus Yr-1 |
| 39-yr commercial (35% · Full Moon venue, structures) | $4,358,856 | Straight-line, NO bonus |
| Depreciable basis (land carved) | $12,453,875 | · |
Do NOT book or disclose the ~$2,995,157 cost-seg upside shield without a formal, engineered cost-segregation study. The BOOKED figure is $721,500 (30 cabins × $65K × 37% REPS; cabin chassis is §1245 personal property). This is the defensible investor disclosure figure. Cost-seg allocation shown at 20/45/35 of the $12,453,875 depreciable basis (land $2,530,000 carved from the honest all-in basis of $18,231,312).
| Exit value at 8% cap (Base P50 NOI $2,360,404) | ~$29,505,050 |
| Depreciable basis (land carved) | $12,453,875 |
| Tax character | §1245/1250 recapture + LTCG |
| Total exit disposition tax (ESTIMATE) | ~$5,866,384 |
ESTIMATE only. The component split (§1245 ordinary recapture, unrecaptured §1250 at 25%, LTCG at 20%) is illustrative pending a formal cost-segregation study. NIIT (3.8%) and Texas state income tax ($0) are not modeled in this figure. Tax-advisor review required before reliance.
REPS §1.469-9(g) grouping election must be made on the original Year-1 federal tax return. It cannot be made on an amended return. If missed, passive treatment applies and the Year-1 tax advantage is lost or deferred as an NOL carryforward subject to the §461(l) cap (~$626K MFJ).
REPS documentation: owner must log >750 hours in qualifying real-property activities AND >50% of total personal services. Annual contemporaneous log required.
Entity: 13|7 Frameworks LLC. Single-member structure recommended · multi-member changes REPS mechanics. Verify entity structure before filing.
Texas franchise tax: ~$10K–$15K/yr on taxable margin (add to sensitivity). No Texas state income tax.
Aquatic / water-park liability is a specialty insurance line. Standard CGL excludes "bodily injury arising from swimming." The pump-driven lazy river (public S-loop + private cabin branch), swim-in grottos, natural pools, the two engineered net swings, and the splash pad require a separate aquatic / water-park operators liability policy from a specialty insurer with resort/aquatic experience. A licensed CPO must be on staff (ANSI/PHTA compliance + DSHS plan approval required). The net swings additionally require a PE structural sign-off over verified water depth.
| Coverage | Estimated Cost | Notes |
|---|---|---|
| Builder's risk (firm quote) | $224,758 | Insure full completed value; TX wind/hail sublimit · confirm |
| Performance + payment bonds (firm) | $149,839 | Lender requirement; surety = credit product, not insurance |
| Contractors CGL (occurrence, ISO CG 00 01) | ~$30K–$60K/yr | $2M/$4M minimum; additional insured per sub contract |
| Workers' comp (W-2 crew) or Occ. Accident (1099) | ~$40K–$80K/yr | Decision required: W-2-on-WC vs. true 1099 + OA |
| Commercial auto (hired + non-owned) | ~$8K–$15K/yr | Traveling crew personal vehicles need HNOA endorsement |
| Umbrella ($5M+ over CGL + Auto + WC) | ~$10K–$20K/yr | Owner + lender likely require $5M–$10M |
| Contractors Professional / E&O | ~$8K–$15K/yr | Required for design-build scope |
| Contractors Pollution (CPL) | ~$5K–$10K/yr | Lazy-river excavation + site work raise exposure |
| Total construction program (one-time) | ~$578,000 | Builder's risk $224,758 + bonds $149,839 (firm) + ~$203K annual-premium program (ESTIMATE) for the 18-month build |
| Coverage | Estimated Annual Cost | Notes |
|---|---|---|
| Commercial GL ($2M/$4M occurrence) | ~$10K–$15K/yr | TX commercial hospitality range |
| Liquor liability (BG beer/wine permit) | ~$3K–$8K/yr | Full MB (spirits) adds $8K–$15K/yr |
| Event liability (Full Moon venue + concert series) | ~$5K–$12K/yr | Per-event or annual blanket; concert nights need endorsement |
| Aquatic / Water-Park Operators Liability (lazy river) ⚠ | ~$50K–$150K/yr | Specialty line · public lazy river + grottos + net swings = highest tier; CPO required |
| Commercial property + business interruption | ~$40K–$80K/yr | Full replacement value; BI for 12-month coverage |
| Umbrella ($5M+ follow-form) | ~$15K–$25K/yr | Same additional insureds as primary policies |
| Workers' comp (resort operations staff) | ~$20K–$40K/yr | If W-2 seasonal/resort staff |
| Commercial auto + HNOA | ~$5K–$10K/yr | Golf carts, utility vehicles, guest transport |
| Total stabilized program | ~$266,500/yr (ESTIMATE, midpoint) | Midpoint of the line-item ranges; firm quotes required before lender submission |
Additional insured (CG 20 10 + CG 20 37): CG 20 10 covers ongoing operations; CG 20 37 covers completed operations. Both required for lender.
Waiver of subrogation: Required on all sub contracts. Prevents insurer from suing another insured party.
Primary & non-contributory: Required where owner/lender is AI. Without this, owner's policy contributes pro-rata in a loss.
Uninsured sub charge-back: Enforce COIs before mobilize. Any uninsured subcontractor payroll is charged back to 13|7 Workers' Comp at audit. No COI = no mobilization.
| Permit / Approval | Timeline | Cost / Notes |
|---|---|---|
| Phase I ESA (ASTM E1527-21) | 3–4 weeks | $2,500–$4,000 · lender-required |
| TxDOT driveway / access permit (I-35 Ex 275) ⚠ | 60–90 days | Traffic study required (~$10K–$20K); START IMMEDIATELY |
| Williamson County site plan | 60–90 days | Submit with civil/grading plans |
| City of Jarrell development agreement (ETJ) | 30–60 days | Confirm jurisdiction · ETJ or city limits |
| TCEQ CGP / SWPPP (TXR150000) | File NOI 7 days before earth-moving | 9.074 ac > 1 ac → CGP required; ~$100 NOI fee |
| City of Jarrell sewer (Crossroads Utility Services) ⚠ | TBD | Get tap fees to firm the cost basis; a connection eliminates OSSF cost |
| Building permits per phase | 2–4 weeks per major permit | Williamson County + Jarrell ETJ; structural drawings required |
| TCEQ aquatic / water-park facility plan (lazy river) | 60–90 days | TX DSHS 25 TAC Ch. 265; licensed PE + CPO certification required |
| TCEQ Ch. 217 WWTP + Edwards Aquifer (30 TAC 213) ⚠ | Critical path | $250K–$1M+; confirm flow calc + aquifer-zone status; folded into honest basis |
| USFWS / TPWD karst + species screen ⚠ | With site plan | Williamson County RHCP enrollment; IPaC + TPWD screen before grotto/waterfall excavation |
| TABC BG permit (beer & wine) | 30–90 days + 60-day sign posting | $1,900/2-yr + local surcharge; 30–90 day timeline |
| TCEQ stormwater / county detention | With site plan | Impervious cover >10% triggers detention design |
Ch. 162 · Construction Trust Fund Act (Criminal): All funds paid to 13|7 FrameWorks LLC for improvements are legally trust funds. Misapplication (using to pay overhead, distributions, or unrelated expenses) is a state-jail felony to felony. Maintain strict separate disbursement accounts and track all payments by contract. Engage construction law attorney before mobilization.
Ch. 53 · Mechanic's / Materialman's Lien: File §53.060 Affidavit of Commencement before construction. 10% retainage on contracts >$25K for 30 days post-completion. First-tier subs must serve §53.056 notice within 30 days of first furnishing.
Ch. 28 · Prompt Payment Act: Owner → GC: pay within 30 days of invoice. GC → Sub: pay within 7 days of owner payment. Late payment accrues 1.5%/month interest. Non-waivable.
Ins. Code Ch. 151 · Anti-Indemnity Act: Broad indemnity clauses (including your own negligence) are void. Each party's indemnity is limited to its own negligence. Draft GC/sub contracts accordingly.
| Year | DS Coverage | Status / Action Required |
|---|---|---|
| Year 1 · lease-up | 0.79× | BELOW 1.0× · covenant holiday required; fund 12-mo interest reserve (~$1.05M); Yr1 NOI ~$826K < DS $1,050,877 |
| Year 2 · build-out | 1.10× | Above 1.0× but below the 1.20× lender covenant minimum · monitor closely |
| Year 3 · stabilization (venue + lazy river open) | 2.25× | P50 NOI step-up to $2,360,404 · covenant comfortably cleared |
| Year 4 · stabilizing (×1.03) | 2.32× | Growing · 3%/yr NOI growth applied |
| Year 5 · stabilized (×1.03) | 2.39× | Stabilized · DSCR (stabilized NOI basis) 2.25× |
Negotiate a covenant holiday with lender before closing for the Year-1 lease-up period (Base P50 coverage 0.79×; P25 downside runs lower at 1.46× stabilized). This is standard for resort development loans. Quarterly NOI + DSCR reporting to lender required (provide within 45 days of quarter-end).
| Pre-opening staffing (6 months) | ~$150K–$250K |
| Initial FF&E beyond construction scope | ~$80K–$120K |
| Launch marketing (Year-1) | ~$60K–$100K |
| Utility deposits / permits | ~$30K–$50K |
| Total working capital (in operating reserve) | ~$320K–$520K |
| Contract value (hard cost ex-land) | $11,585,000 |
| GC fee / margin | ~$810,950 |
| General conditions (~5%) | ~$579,250 |
| Self-perform labor (est. 20% of cost) | ~$2,317,000 |
| Subcontractor cost (remaining) | ~$7,877,800 |
| Gross profit (GC fee + GC conditions) | ~$1,390,200 |
| Home office overhead (~3%) | (~$347,550) |
| Net job profit to 13|7 FrameWorks | ~$1,042,650 |
Self-perform labor burden (if W-2): ~$180K–$360K additional (payroll taxes + WC on ~$750K–$1.5M labor base). 1099 worker classification must be resolved before mobilization · see Flags section.
Revenue recognition method: percentage-of-completion (cost-to-cost input method) per ASC 606. Total contract value $11,585,000 (hard cost ex-land) = total estimated cost (GC fee is recognized separately). Retainage: 10% of each billing, released 30 days after substantial completion (Ch. 28 Prompt Pay Act).
| Milestone | Cumulative Spend / Revenue Recognized |
|---|---|
| Month 6 | ~$2,896,250 (25%) |
| Month 12 | ~$5,792,500 (50%) |
| Month 18 (substantial completion) | $11,585,000 |
TCEQ Ch. 217 WWTP ($250K–$1M+) plus county detention were the un-budgeted items that drove the re-underwrite from $14.98M to a $18.23M honest basis. Confirm the wastewater flow calc and whether the site sits in the Edwards Aquifer contributing/recharge zone (30 TAC 213) · aquifer-zone status materially changes cost and timeline. Environmental is now inside the basis (ex-env floor $17.46M).
Williamson County hosts endangered karst invertebrates (Bone Cave harvestman, Coffin Cave mold beetle) and golden-cheeked warbler habitat. Run a USFWS IPaC + TPWD screen and enroll in the Williamson County Regional Habitat Conservation Plan (RHCP). Grotto and waterfall excavation for the lazy river raises karst-void exposure · a geotech karst survey is required before excavation.
Reflections (the owner-locked $1.75M turnkey lazy-river builder) is a Chicago residential natural-pool builder; its Texas licensure and resort-scale capability are unconfirmed. Make TX licensure + demonstrated resort experience (or a named TX civil/aquatics GC of record) a condition precedent in the vendor contract before any deposit.
At the P25 downside (P25 revenue, 9% exit cap), unlevered NPV@12% is −$3,365,173 (negative). This is disclosed honestly; debt is still covered at a 1.46× stabilized DSCR in that case. Required disclosure in every PPM, investor presentation, and lender package. Omission = securities-law violation.
Year-1 NOI (~$826K) does not cover annual debt service ($1,050,877). Requires: (1) negotiate a covenant holiday, (2) fund a 12-month interest reserve (~$1.05M) at close, (3) fund the operating reserve. Do not close without both reserves confirmed. Stabilized DSCR recovers to 2.25× at base (Year 3).
If the traveling crew is directed/controlled like employees, IRS and TWC will reclassify as W-2. Exposure: back taxes, penalties, WC liability for all uninsured injuries. Decision required: W-2-on-WC vs. true 1099 + Occupational Accident. Affects the labor burden in the financial model.
Standard CGL excludes "bodily injury arising from swimming." The pump-driven lazy river, swim-in grottos, natural pools, the two engineered net swings, and the splash pad require a separate aquatic / water-park operators liability policy from a specialty insurer. CPO on staff required. The net swings additionally require a PE structural sign-off over verified water depth.
I-35 Exit 275 access requires a TxDOT Right-of-Way driveway permit + traffic study (~$10K–$20K), 60–90 days minimum · start immediately; delay = a full-quarter construction delay. Separately, under Texas Property Code Ch. 162 all funds paid to 13|7 FrameWorks for improvements are legally trust funds; misapplication is a felony. Maintain strict separate disbursement accounts and engage a construction-law attorney before mobilization.
The retired v3.1 model used a 40.8% opex ratio that sat below market. Published glamping / cabin-lodge benchmarks show NOI margins of 40–60% of EGR (RoverPass 2025; Loan Analytics 2025; MMCGInvest 2025), so 50% opex is now the conservative base and 40.8% is treated as the upside. An engineered HVS / CBRE / STR opex study replaces the assumption before lender submission.
The 8% base-case exit cap sits at the aggressive end of the 2026 7–10% range. A 7/8/9/10% exit-cap sensitivity shows the base case holds. Commission a broker cap-rate opinion on a comparable Texas I-35 corridor property before investor presentations.
The model books 65 full-hookup pads ($75/nt); this count requires field verification against the site plan and revenue scales proportionally with the confirmed count. Day-use gate + concert-series revenue (the diversification thesis) is also ESTIMATE-flagged · underwrite the gate/concert counts before lender submission.
The two engineered 2-person net swings need PE-stamped steel supports over verified water depth, safety-enveloped (the Vang Vieng lesson). No swing may be fabricated or installed without the structural sign-off and a confirmed minimum water depth beneath the swing envelope.
The TABC BG (beer & wine) permit runs 30–90 days plus a 60-day sign-posting period. Start the application early so the bar / Airstream program is licensed by opening; spirits (full MB) extend the timeline and cost.
Texas state HOT is 6%; the city rate is unknown (small TX cities can charge up to 7%). Confirm with the City of Jarrell before finalizing the pricing model. HOT is a pass-through but affects gross pricing strategy. Confirm whether the ADRs ($175 cabins / $75 RV) are gross or net-of-HOT.
The fire rule: no open flame anywhere on site (LED-wrapped palms only; no gas/propane fire features), which keeps NFPA 58 from being triggered. Confirm the final landscape/lighting permit set carries no gas/propane feature so the no-flame decision holds through construction.
