TITUS HOUSE UPDATE AND CAPITAL CALL
Market-Validated Value Creation | September 2025
Downtown Mixed Use District | Truckee, CA
Current Market Dynamics - Why Now
Supply Constraints
- • DMU vacancy at historic low: 5% or less
- • Zero construction pipeline in market
- • "For sale" inventory extremely limited
- • Properties pricing at or above ask
Demand Drivers
- • 15 million visitors within 5-hour drive
- • Lifestyle migration from remote workers
- • High-net-worth community presence (Martis Camp, Lahontan, others)
- • Strong short-term rental market potential
DMU Market Benchmarks vs. Titus House Position
| Market Metric |
Current DMU Market |
Titus House Target |
Position |
| Cap Rate |
5.0% - 5.5% |
6.21% |
Conservative |
| Occupancy Rate |
95%+ |
97.6% |
Achievable |
| Rental Rate (NNN) |
$4.00 - $5.00/SF |
$4.50/SF |
Mid-Range |
| CAM Costs |
~$1.00/SF/month |
Included in NOI |
Factored |
Investment Thesis
We own a property on the 50-yard line of Lake Tahoe's premier commercial corridor in the essential town
of Truckee, where there is severely limited supply of real estate. Our conservative underwriting at 6.21%
cap rate provides 70+ basis points of cushion versus market rates of 5.0-5.5%.
With properties trading at or above ask and zero new supply pipeline, the timing for value creation through
renovation and revenue optimization has never been more compelling.
Post-Renovation Revenue Model & Timeline
Q1 2026 Stabilized Income Projections
| Space Type |
Start Date |
Square Feet |
Rate/SF |
Annual Revenue |
| Office Space |
Q3 2025 |
500 |
$2.50 |
$15,000 |
| Bakery Operations |
End Q4 2025 |
200 |
$40.50-54.00 |
$97,200-129,600 |
| Guesthouse Pantry |
Q1 2026 |
1,000 |
$3.50 |
$42,000 |
| Commercial Kitchen |
Q2 2026 |
800 |
$3.50 |
$33,600 |
| Combined Property Income |
Phased |
2,500 |
$3.75-5.20 avg |
$187,800-220,200 |
*A related entity, Guesthouse Hospitality Company is the tenant for Titus House
NOI-Based Valuation Analysis
Annual NOI
$170,082
Professionally Validated
Net Yield on Investment
15.5%
$170K NOI / $1.1M invested
Property Value at 6.21%
$2,740,000
$170,082 / 0.0621
Value Creation Analysis
Conservative Scenario (6.21% Cap)
Current Value: $2,000,000
Post-Renovation: $2,740,000
Value Created: $740,000 (37% increase)
Market Rate Scenario (5.5% Cap)
Current Value: $2,000,000
Projected Value: $3,092,000
Value Created: $1,092,000 (55% increase)
NOI: $170,082 | Total Investment: $1,100,000 |
Projected 2-Year IRR: 28-35%
*Forward-looking projections subject to market conditions.
Project Excellence & Validation
Regulatory Achievements & Progress
| Milestone |
Status |
Date |
Impact |
| Phase 1 - Existing Use |
APPROVED |
May 28, 2025 |
Welcome area & retail permitted |
| Phase 2 - Renovation/New Use |
Submitted |
Aug 4, 2025 |
Town review in process |
| Historic Preservation |
Planning |
Q4 2025 |
HPAC review upcoming |
| Zoning Clearance |
Pending |
Q4 2025 |
Triggers second capital call |
| Building Permits |
Follows |
After Town Approvals |
Construction start Q1 2026 |
Professional Validation
Colliers International (June 2025):
- • Professional appraisal: $2.74M completion value
- • Stabilized NOI: $170,082 @ 6.21% cap rate
- • Market-validated rent: $4.50/SF/month
- • 37% value creation from current $2.0M baseline
Town of Truckee Progress:
- • Phase 1 Existing Use Permit secured
- • Phase 2 renovation plans submitted for Town review
- • DMU zoning confirmed for commercial, retail, office uses
- • Historic preservation planning underway with architect
Best-in-Class Development Team
We have assembled a world-class team of professionals to execute the Titus House vision. Each team member brings
deep expertise in historic preservation, hospitality design, and mountain resort development. This collaboration
ensures both respect for Truckee's heritage and creation of a contemporary destination that meets modern market demands.
General Partner, Guesthouse Flagship Stewards
Deep real estate experience and experienced counsel (Morrison Foerster, others).
Successfully launched partnership with Tahoe Modern and secured first tenant at Titus post-acquisition.
Architecture & Concept
Founded in 2005, Michael Hsu Office of Architecture is a nationally award-winning, fully integrated architecture
and interior design practice whose work is rooted in hospitality.
Architect, Planning
Strong local experience in Truckee with expertise in historic preservation requirements and DMU zoning.
Leading the technical execution and Town approval process.
Kitchen Design Specialists
Best-in-class kitchen design consultants specializing in commercial kitchen development. Notable projects include
Single Thread in Healdsburg and numerous Michelin-starred restaurant kitchens throughout California.
MEP Engineering
Leading Tahoe-Truckee MEP firm with expertise in high-altitude mechanical systems, commercial kitchens,
and sustainable building solutions. 30+ years serving the mountain community.
General Contractor
Premier builder with experience at Truckee Airport, Trokay, and premier properties throughout Truckee
and Lake Tahoe. Known for quality craftsmanship and on-time delivery.
Bakery Partner
Icelandic master baker bringing authentic European bakery traditions. Successfully operates multiple
high-volume artisan bakeries with proven mountain resort market appeal.
Why This Team Wins
- • Local Knowledge: Deep understanding of Truckee market dynamics and regulatory environment
- • Proven Track Record: Each partner has successful projects in mountain resort markets
- • Historic Expertise: Specialized experience in adaptive reuse and preservation
- • Operational Excellence: Partners who understand hospitality operations, not just development
Capital Structure & Individual Participation
FOR REVIEW - Your Response is Requested
Immediate Investment Opportunity: $300,000 first tranche to activate revenue generation
Response Requested By: September 30, 2025
Note: Second tranche of $800,000 only upon successful Town approvals (anticipated EOY 2025)
This first tranche is critical to create value that will enable additional funding from institutional sources
Individual Participation Opportunity
| Partner |
Ownership |
First Tranche (NOW) |
Second Tranche* |
Total Opportunity |
| Gail Dunnett |
15.23% |
$45,690 |
$121,840 |
$167,530 |
| Doug Appleton |
15.23% |
$45,690 |
$121,840 |
$167,530 |
| Ji Hyun Kim |
30.46% |
$91,380 |
$243,680 |
$335,060 |
| Guesthouse Flagship |
16.24% |
$48,720 |
$129,920 |
$178,640 |
| Edmond Mulaire |
7.61% |
$22,830 |
$60,880 |
$83,710 |
| Rohit Gupta Trust |
7.61% |
$22,830 |
$60,880 |
$83,710 |
| Jeff Brown |
3.81% |
$11,430 |
$30,480 |
$41,910 |
| Jasmine Watts |
3.81% |
$11,430 |
$30,480 |
$41,910 |
| TOTAL |
100% |
$300,000 |
$800,000 |
$1,100,000 |
*Second tranche contingent upon Town approvals. First tranche commitment enables project momentum.
Individual Partner Return Analysis*
Conservative (6.21% Cap)
Every $100K invested →
$167K value
67% return in 2 years
Market Rate (5.5% Cap)
Every $100K invested →
$199K value
99% return potential
*Data for analysis derived from appraisal by Colliers International (June 2025). Plus annual cash distributions from stabilized NOI of $170,082 (15.5% net yield). Forward-looking statements based on current market conditions.
Your Participation Response Requested
Please confirm your participation interest by September 30, 2025
Wire instructions and documentation will follow confirmation