Affordable Rental Housing and Multiunit Housing Solutions NWCUF Affordable Housing Summit January 22, 2018
State Employees’ Credit Union (SECU) • North Carolina chartered credit union serving state and public school employees and their family members • 2.2 million members (22% of all North Carolinians) • $37 billion in assets / 260 branch locations / 1,100 ATMs • $16 billion first mortgage portfolio (~135,000 loans) • 99% Member Satisfaction
SECU*RE, Inc. ▪ Short for “SECU – R eal E state” ▪ Real Estate Property Management CUSO ▪ 100% Wholly Owned Subsidiary of State Employees’ Credit Union ▪ Created as a “C” Corp—”For Profit” Entity ▪ Formed in response to the housing crisis of late 2000s to provide a better solution to the foreclosure process
Mission, Focus, Goals of SECU*RE • SECU*RE’s mission is to profitably acquire, renovate, lease, and sell SECU foreclosures while preserving local property values, enhancing the reputation of SECU, and improving communities across North Carolina. • Focus is on providing safe, affordable, and energy efficient rental housing to the citizens of North Carolina • Goal is to sell properties for more than our investment as the real estate market improves and to generate positive earnings.
Purpose of SECU*RE • SECU*RE purchases SECU foreclosures, rehabs the majority of them to a standard above the current norm, and then leases the properties • Rental income received provides a return on our investment that exceeds the return available through other traditional investment options.
Rental Process • Local Approach – SECU*RE branch representatives market, show, and process rental applications – Non-emergency repair requests handled locally • Back Office Functions – Create marketing flyers – Prepare leases – Coordinate semi-annual property inspections – Support branch network
SECU*RE Statistical Summary 1600 1435 1400 1189 1200 997 1000 905 792 December 2015 800 December 2016 600 478 December 2017 304 400 311 269 200 104 84 76 0 Total Inventory Units Rented Units Available Units Under (# Units) for Rent Renovation, etc
SECU*RE Monthly Rental Income History $1,000,000 $921,951.75 $900,000 $807,292.87 $800,000 $706,009.25 $700,000 $647,278.16 $672,404.60 $600,000 $578,768.31 $500,000 $473,194 $388,333 $400,000 $333,000 $347,500 $300,000 $190,000 $216,666 $200,000 $57,000 $108,333 $100,000 $0
Examples of SECU*RE Properties
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Tenant Experience “ Renting from SECU*RE has been a pleasure! I’ve rented from other individuals and a nationally known company and NO ONE can touch SECU*RE for ANY reason. If I run into anyone who expresses interest in renting a home, I will DEFINITELY tell them to go to SECU*RE!” - Keith Jung, Tenant “ Emily and I have decided to continue renting for another year. Thank you, SECU*RE, for being such an amazing rental agency; we really appreciate the flexibility and professionalism we are provided” -Stacy and Emily Bonds, Tenants
Success Stories • Acquired property for $61,600 in October 2013 from SECU • Completed $26,000 in renovations • Began leasing in March 2014 for $825 a month • Received $32,000 in rent over 3+ years • Tenant approached SECU*RE in February 2017 an inquired about 6103 Clearwater Drive, Indian Trail purchasing home • Sold to tenant for $116,000 in June. • SECU*RE profited $29,000 on sale.
Success Stories • Acquired property for $85,600 from SECU in February 2014. • Completed $22,000 in repairs • Began leasing in May 2014 • Received $29,000 in rental income 1004 Jennings Road, Statesville • Sold to tenant for $145,000 in August 2017 • SECU*RE profited $26,500 on sale • SECU provided mortgage financing for the purchase
Real Estate Broker Network • Network of 22 employees across the state have completed licensing perquisites to list properties for sale on MLS on behalf of SECU*RE • Results in a 3% savings on real estate sales (standard listing agent commission in NC) • Started listing properties in Fall 2017. Savings to date equal $200,000+.
The Improved Rental Market
Homeownership and Corporate Landlords
Summary In 4+ years, SECU*RE has grown into an established property management company with over 1,400 single family residential homes. SECU*RE is making a positive impact across North Carolina by rehabbing homes, improving neighborhoods, and providing North Carolinians with safe, affordable rental housing.
SECU Foundation • Promotes local and community development by funding high impact projects in the areas of housing, education, healthcare, and human services. • Funded by SECU members via monthly $1 contribution • Over $130 million awarded to worthwhile causes since 2004
Teacher Housing • SECU Foundation funded interest-free loans to help build four teacher housing complexes across North Carolina • Rents are affordable and units are restricted to teachers and their families • Assists local public school systems with recruitment and retention
Questions?? Contact: Mark Kretzschmar Email: mark.kretzschmar@ncsecu.org Work Phone: (919) 508-8767
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