Marquette Land Investments

While MLI is a national land fund, in our hometown, the Chicago Metropolitan Area is projected to expand steadily over the next decade. A continued increase in population will result in a continued increase in the demand for housing. The strategic development imperatives of public homebuilders, like Pulte Homes, require the acquisition of additional developable land in the Chicago market. Three obstacles hinder this objective.

1 SEC Regulations:
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As public companies, these homebuilders are subject to SEC regulations prohibiting them from buying land on a speculative basis. This precludes these companies from purchasing land on a cost-effective basis for those parcels where the owner may be unwilling to give the additional time necessary to finish the required municipal approvals (typically 12 to 24 months).


	2 Competitive Bidding: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The market for developable land is extremely competitive. As homebuilders become ready to develop new land, the best properties get caught up in bidding wars between rival homebuilders vying for the same parcels of land. In this competitive environment, there is nothing that differentiates the homebuilder. However, the ability to procure unentitled land on a non-contingent basis earlier in the development cycle provides a mechanism through which the homebuilder can effectively compete against other builders in order to secure strategic parcels.

3 Profitability Thresholds:
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In order to meet their IRR hurdles, public homebuilders find it is necessary to use “off balance sheet” financing. The up-front development costs have become unbearable, requiring the homebuilder to use a multiple take-down strategy (purchasing a property in several pieces over time) in order to accomplish their return requirements.


	Through the formation of a strategic land acquisition program, Marquette Land Investments, LLC (“MLI”) and public homebuilders like Lennar create a synergistic relationship wherein each entity benefits as follows:

> Public Homebuilders
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Gains access to desirable land parcels in an SEC-compliant manner that permits the achievement of its rate of return requirements;

Creates a competitive edge when bidding against other public companies when trying to acquire strategic parcels of land; and

Creates an inventory of future lot development so that they can move seamlessly from one development to the next upon sell-out.


	> Marquette Land Investments, LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gains access to the financial capital and resources of builders like Pulte, facilitating: 1) assistance in the completion of the planning and zoning process; and 2) the development of the required land infrastructure; Purchases land at a discount by taking possession of the land without any contingencies (public homebuilder would have these contingincies if it were purchasing land); Finances only the land cost during the investment holding period, generating favorable return for its investors; and Gains access to commercial land at below market prices.

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