“The Utah-Wasatch Pride of Ownership Hotel Option Fund I” is a small $100,000 fund being raised by Odoomber Tree Capital, which during the course of 2016 and 2017 has positioned itself via its network into the first buyers position on monetarily promising hotels, which are in alignment with its investment thesis, in its target geography .
Odoomber Tree Capital is geographically committed to the Wasatch Front and Wasatch Back of the state of Utah. “Wasatch” refers to the Wasatch mountain range which itself forms the western edge of the Rocky Mountains. For the purposes of Odoomber Tree Capital’s target geography for hotel acquisitions, The Wasatch Front corresponds to Salt Lake and Utah counties, while the Wasatch Back corresponds to Summit County and Wasatch County. Included in this geographic region are the high-tech “Silicon Slopes” region south of Salt Lake City; Salt Lake City itself; the popular ski town Park City; and the world-renowned ski areas of Alta, Snowbird, Brighton, Solitude, Park City Mountain, and Deer Valley.
There is no public link to this subpage within our website. Only individuals who are personally or professionally affiliated with the Principals of Odoomber Tree Capital will be specifically invited to this opportunity to be investors and will be given this link.
Pride of Ownership
In addition to robust financial returns on the deal-level, as is described further below, investors will also benefit from pride of ownership of key Wasatch Front and Back hotels, each of which aligns with our Triple Bottom Line mandate.
Once you decide to invest and subscribe to the fund, you will receive a document that includes both a receipt for dollars received as well as language that conveys a financial instrument known as an “Option”. Specific dynamics are as follows:
The Option price is set at $2,500. Any number of Options can be bought. A typical amount is ten Options.
Each Option gives the investor the right of first refusal to invest equity up to ten times its value in the LLCs which form for the next three Odoomber Tree Capital hotel deals.
Thus the investor, by purchasing an Option, secures his spot as a Limited Partner in these LLCs.
Moreover, the entire monetary value of the Option will be credited towards an equity position in the deal-level LLC without any transaction fee or Option strike price charged to the investor.
The investor’s initial stake (i.e. the original Option), along with any further amount he/she chooses to invest as is allowed by the 10x multiple written into the Option, will be reflected as such in the deal-level LLC’s operating agreement. The investor will have rights to waterfall profit returns consistent with the other equity investors’ rights. The date from which the Investor’s interest accrual based on annualized returns and IRR (as outlined in that future deal and investor waterfall model) will be the date that the Investor transfers the dollars to pay for his/her Options to Odoomber Tree Capital.
Use of Funds
The Fund will be provisioned as working capital to accomplish the myriad of tasks and to allocate the manpower necessary to close on the Wasatch region hotel deals in Odoomber Tree Capital’s pipeline.
In the accounting of the deal-level LLC, the Options capital will be credited as “prepaid Developer fee” which, as is the norm in commercial real estate, the sponsor (i.e. Odoomber Tree Capital) is entitled to. No excess Developer Fee will be charged in totality to the LLC, so in order to compensate for the prepaid Developer Fee, the sponsor will take lower Developer Fees for a period of time during the lifetime of the LLC. Thus the investor can rest assured that he/she will not be “double-charged” and will partake of fair investor waterfall returns during the lifetime of the LLC.