Analysis of Investments
TSWR Saltwater SWD Portfolio
Sandlapper Capital Investments
Sandlapper Capital Investments TSWR Saltwater SWD Portfolio consists of seven salt water disposal plants. The investors will buy a fractional working interest in each of the facilities. They are located in West Texas in the Permian Basin.
Investment Highlights
- Yr. 1 Cash-on-Cash 8.00%
- Initial Occupancy
- Est. Time Horizon 10 years YEARS
- Current Cash Flow
- Yr. 1 Cap Rate to Investor 8.63%
- Investor Purchase Price $4,100,000
- Total Offering Size $4,100,000
Loan Information
N/A
- Yr. 1 DSCR None
- Loan-to-Offering 0.00%
- Hold Period DSCR None
Tenant Information & Lease Terms
N/A
Key Positives
Sandlapper intends to negotiate with multiple oil companies who are looking for piped water for their drilling process. The sponsor has stated that included in those negotiations is Shell.
Key Risks to Consider
The upfront cost of syndication is very high and higher than comparable investments. The upfront costs totals 18.91% of investors equity contribution.
The transaction to purchase the wells was completed with an affiliate company and therefore the transaction may have been completed at a price above market. This would be considered non "arm's length".
This investment is tied to the performance of the oil and gas industry. Should the industry take a downturn, or if the wells purchased are not productive the cash flow from this investment will suffer as the amount of water being used will be limited to production.
This investment is highly dependent on the operator of the wells.
Investment Sponsor Information
Sandlapper Capital Investments
According to the sponsor's website: "Sandlapper Capital Investments, LLC (Sandlapper) was created to take advantage of opportunities brought about through the dynamic and ever-changing economic landscape. Often some of the greatest investment opportunities throughout history have been missed by those who lack the agility necessary to seize them. Our experienced team has the skills, tools and resources necessary to identify, analyze and act upon timely opportunities across a vast universe of industries.
Sandlapper principals collectively have decades of experience across a broad range of industries and investment vehicles covering both the public and private markets. These industries include packaged product analysis, commercial real estate equity and debt, tax credits and shelter programs, oil and gas and related industries, equipment leasing, corporate and municipal debt as well as other debt obligations and portfolio management."