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Vote Set on Co.'s 'Recession-Proof' Sustainable Housing Subdivision

Source: Streetwise Reports

 

November 1, 2023 (Investorideas.com Newswire) This company says an important vote on its sustainable housing development is coming up in California. Find out why one analyst says the project is "exactly what the market needs."


The commission will meet on November 13 to consider the Sage Ranch Precise Development Plan, a two-year collaboration between the company and city staff to lay out the architecture, designs, roads, sewers, water systems, grading, parks, curbs, sidewalks, common areas, and clubhouse of the development.

"The effort provided by both Greenbriar and the City of Tehachapi left no stone unturned to make sure the development is top-of-its-class, innovative, and groundbreaking to match the demands of a new sustainable world," said Greenbriar Chief Executive Officer Jeff Ciachurski. "Throughout the process, we tailored our work product for a final submission that would leave a legacy and provide no doubt that only a top-quality product will be provided. The city made all parties aware of the significant impact Sage Ranch will have on the exceptional quality of life in the region and the tremendous economic impact to the city and surrounding area."

Greenbriar said Sage Ranch will be a "low-carbon showcase." All students will have a walk of three blocks or less to get to their elementary, middle, or high schools, eliminating the need for busing. The development also will have solar roofs, smart meters, and optional battery storage.

In fact, the company is so sure about its low-carbon view for future living that it is applying to the Toronto Venture Exchange to change its name to Greenbriar Sustainable Living Inc.

Greenbriar also recently re-executed its US$40 million financing agreement with Voya Investment Management.

Ron Struthers of the Struthers Resource Stock Report said approval of the development would mean "strong revenues for Greenbriar in 2024."

"Sage Ranch will provide low-cost entry-level homes that will not be affected by any downturn because it is exactly what the market needs and wants at this time," Struthers wrote for Streetwise Reports. "It is a great location and near large military operations."

Affordable Homes, Local Taxes, and Money for Local Economy

Sage Ranch itself is on a 138-acre site located near downtown Tehachapi within a half-mile of City Hall, adjacent to schools, and close to many shops, restaurants, and public spaces, the company said.

Altus Group Ltd., the industry's leader in feasibility analysis, has completed a report on Sage Ranch, Greenbriar said. It would be built in six phases over six years with up to 165 units per year. The projected net residential revenue is estimated at nearly US$409 million, with a projected net profit of about US$174 million.

The project is "recession-proof" because even with higher interest rates, homeowners "will have mortgage payments equal to or much less than paying rent for an equivalent new residence," the company said. Government assistance will also be available.

The company also announced that the chairman of its Real Estate Advisory Board, Tommy Sullivan, has brought an opportunity for Greenbriar to enter a joint venture to build a 1,361-acre, 3,500-home sustainable subdivision in Utah's fastest-growing area. The project would give Greenbriar a 20-year runway of building several hundred homes per year, giving it the "status of regional builder and developer," the company noted.

For locals, the Sage Ranch property would provide hundreds of construction job, more than US$5 million annually in property taxes, US$20 million in infrastructural and governmental fees, US$1.5 million per month of retail spending in the local economy, and more than US$26 million local real estate commissions, Greenbriar said.

The development would also bring in a revenue stream of US$80 million per year for six years to shareholders, the company said.

'Of Course, I'm In'

Jeff Siegel, editor of Green Chip Stocks, said one of the things that attracted him to the company was the CEO, Ciachurski. Ciachurski was the founder and CEO of Western Wind Energy Corp., which he built up with a few thousand dollars and sold for US$420 million a decade ago.

"He was very concerned about making sure the shareholders never got diluted and looking out for the best interests of shareholders," Siegel said.

Siegel liked his track record and his focus on green investments.

"He was like ... 'There's lack of affordable housing in this area, we can do this in a way that normal middle-class people will be able to afford a home, which is, you know, very hard these days,'" Siegel recalled. "And then also building it in a sustainable manner, making it a walkable community, integrating solar and energy efficient applications (into) the home ... Of course, I'm in."

The market is 'Painful,' 'Ugly'

The average 30-year fixed mortgage rate is around 8%, the highest it's been since 2000, CNBC reported. The National Association of Realtors Housing Affordability Index has gone down by nearly half in the last three years, sending mortgage demand to its lowest point in decades.

"I think it's painful. I think it's ugly," Mortgage News Daily Chief Operating Officer Matthew Graham said on CNBC's "The Exchange."

A survey by Redfin found that 38% of buyers under 30 needed family help to afford a down payment, either in the form of a gift or inheritance.

"As a result, a large share of young homeowners can be labeled 'nepo-homebuyers,' meaning they received family money to purchase a home," Redfin Chief Economist Daryl Fairweather wrote. "This phenomenon contributes to intergenerational wealth inequality and limits economic opportunities for young people and their families."[OWNERSHIP_CHART-9533]

Struthers rated Greenbriar a Strong Buy. "On the chart, there is some resistance between CA$1.05 and CA$1.15, so it might give a chance to buy some stock around these prices," he wrote. "The next resistance is around CA$1.55, and I believe the stock is headed there next. A break above that would be a solid higher high."

Ownership and Share Structure

According to Reuters, about 20% of the company is owned by strategic entities. The rest is retail.

Major shareholders include Ciachurski with 7.86%, President Cliff Webb with 5.21%, Heidi Ciachurski with 5.03%, Director William Robert Sutherland with 1.22%, and Chief Financial Officer Anthony Balic with 0.44%.

Greenbriar has a market cap of CA$37.48 million with about 34 million shares outstanding. It trades in a 52-week range of CA$1.55 and CA$0.62.

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