How you make money
Equity growth
Build 53 homes and sell into a short-supply market
Land closes July 2026, homes start at 5 per month on a 6-month build cycle, and the program reaches final sellout by June 2028. Returns come from selling finished cottages and townhomes at market pricing.
1.6x
Equity multiple
30%
Projected IRR
24 mo
Hold period
Sale
Exit strategy
Cash flow
LP-first 8% preferred return accrues on invested capital
Capital is returned in strict priority: full return of LP equity, then an 8% cumulative preferred return, then a 55/45 LP-favored split to the first hurdle before the GP earns any meaningful promote.
Quarterly
Distributions
How the deal works
Summit 7 Capital acquires the land, builds 53 cottages and townhomes in-house, and sells them into a Lake Oswego submarket with structurally limited new inventory. Construction runs at five starts a month on a six-month build cycle, with sales pacing alongside at five homes a month. The waterfall returns LP capital first, then pays an 8% preferred, before the GP shares in profits — a capital-efficient roughly two-year path to full return plus preferred.
A 53-unit cottage and townhome program built for broad absorption
The mix of 29 cottages and 24 townhomes targets first-time buyers priced out of single-family, downsizing homeowners, and young professionals at once. That breadth is a natural absorption hedge. Fixed per-SF pricing of $300 for cottages and $250 for townhomes holds construction cost steady.
Lake Oswego demand outruns a structurally short new-home pipeline
Median household income is $140,441, 93% of residents are college educated, and the median age of 46 sits in the prime homebuying cohort. Population and employment growth exceed regional averages while competing for-sale inventory stays constrained by entitlement timelines and land scarcity.
Capital returns in 24 months, not a five-year fund lock-up
Land closes July 2026 and final sellout completes by June 2028, with debt fully retired and LP capital and returns distributed. The model projects a ~30% IRR and a 1.60x equity multiple on the roughly two-year hold.
Conservative underwriting with fixed pricing and funded reserves
Each budget line carries fixed per-SF contract pricing, a 5% hard-cost contingency, and a fully funded $400K interest and fee reserve at closing. Land basis of $10.88M provides downside support against an implied total project cost of $48.8M.
About the sponsor
$500M+
under management
30+ yrs
in Pacific NW real estate
Self-performed
land dev + construction
A vertically integrated Pacific Northwest residential land developer and homebuilder.
Ken Allen
Founding Partner
30+ years in real estate acquisition, development, and homebuilding. Leads Summit 7's investor relations.
Kathy Heitman-Allen
Founding Member
Co-founded Summit 7 Capital. Partner in the firm's development and investment strategy.
What you should know
What should I weigh?+
- Projected IRR and equity multiple are estimates based on assumptions, not guarantees.
- Slower absorption than the planned five homes per month would extend the hold and reduce returns.
- Residential development carries entitlement, construction, and financing risk, including the AD&C loan at 6.50%.
- A downturn in the Lake Oswego for-sale market could compress sale prices below underwriting.
- Private placements are illiquid; capital is locked until unit sellout, with possible loss of principal.
When is investor capital returned?+
Capital is returned through unit sellout. The waterfall returns LP equity in full first, then pays the 8% preferred, with final sellout and full distribution targeted for June 2028 — roughly 24 months after land close.
How does the profit split work?+
After return of LP capital and the 8% preferred, cash flows split 55% LP / 45% GP to the first hurdle. Beyond that hurdle the split moves to 45/55, activating the GP promote. The GP co-invests its own capital alongside LPs.
How is construction cost controlled?+
Vertical construction uses fixed per-SF contract pricing — $300/SF for cottages and $250/SF for townhomes — plus a 5% hard-cost contingency and a fully funded interest and fee reserve. Summit 7 self-performs through its in-house general contractor.
Are these investments IRA/401(k) eligible?+
Yes — Hazelia Living is eligible for investment through an IRA or 401(k).
How often are distributions paid?+
Distributions are paid quarterly, after project revenue has been realized.
