Reselling Your Inventory
Reselling your Flora Inventory
The Coveted Group is a seasoned broker that specializes in the marketing and sales of deeded fractional real estate. With over a decade of experience as the exclusive broker for Real Estate by Flora Farms, we have an outstanding record of achievement, having sold nearly all inventory at the Culinary Cottages and Hillside Haylofts and over 60% of the available inventory in The Lofts at Flora. The Coveted Group’s team of sales and marketing associates are experts in the Flora communities and homes, and the Los Cabos fractional real estate market. We use our extensive knowledge, energy, creativity and experience to resell your inventory with the same dedication and enthusiasm as we have for the developer's unsold inventory.
Marketing Power
The Coveted Group has developed a highly effective system for attracting leads and prospects through a combination of retail, digital, and referral marketing strategies complemented by other proprietary marketing secrets. We engage with thousands of Flora-compatible leads annually, a significant portion of which are converted to new and highly qualified real estate prospects. This results in a large number of daily real estate showings, most of which are compatible and qualified prospects. Additionally, we meet with hundreds of clients who already own inventory at Flora Farms, many of whom go on to purchase additional inventory.
Our Sales Process and Tools
The Coveted Group has honed its sales process and tools over the years to achieve great success, particularly at Flora Farms. These include:
On-site sales associates and offices: The Coveted Group's sales associates are present on-site and available to meet with prospects Tuesday through Sunday every week. We have three private sales rooms on Flora Farms to conduct sales meetings.
Professional showings: The Coveted Group's showings are highly professional and include complimentary food and beverages for all prospects. On average, we spend $1,500 on marketing and gifting per qualified prospect we show real estate to (regardless of whether the prospect buys). Our sales associates have extensive knowledge of Flora's real estate products and spend a great deal of time carefully showing and explaining the opportunity, contributing to their ability to close an average of 50% of the qualified prospects we engage with.
Quick access to “models”: The Coveted Group's staff is on-site and has a system in place to offer guests of occupied Cottages or Haylofts gifts in exchange for allowing them to show their dwelling to interested prospects.
Monitoring funds: When your inventory is sold, the Coveted Group associate who sold it will closely monitor the movement of all funds related to the sale and ensure that you are paid as soon as possible, per the terms and conditions of your Listing Agreement.
The Resale Process
Requirements. An owner wishing to resell their inventory must have fulfilled all outstanding payments and obligations to Flora Investments and be in good standing with the company.
Base Sales Commission
The Coveted Group's base sales commission is determined by the sale price, per the table below.
$150,000 and over: 15% Base Sales Commission
$100,000 - $149,999: 16.5% Base Sales Commission
$70,000 - $99,999: 17.75% Base Sales Commission
$69,999 or less: 19% Base Sales Commission
The Base Sales Commission includes an initial Pocket Listing —which means the seller's inventory will NOT be displayed alongside available developer inventory but will be revealed to prospects if they specifically request inventory matching the seller's inventory, which is not available in the developer inventory.
Optional Marketing Upgrades
The Coveted Group provides the following marketing upgrades that can significantly speed up the sale of inventory. It's important to note that the marketing department of The Coveted Group typically schedules between five and nine prospective buyers per week. The cost per scheduled prospect ranges between $1,000 and $1,900 USD, which is incurred by The Coveted Group regardless of whether or not the prospect chooses to make a purchase. This means the following upgrade listings are presented to 20 to 36 prospects per month. Due to this, the following upgrade options come with additional marketing commission fees.
A Prime Listing will showcase the seller's resale inventory alongside all available developer inventory and is presented to weekly prospects. The Coveted Group charges a Marketing Commission of 5% for this option.
A Premium Listing includes all the benefits of a Prime Listing, in addition to a dedicated online listing on thecovetedgroup.com, targeted email campaigns to The Coveted Group's databases of over 100,000 people, and regular emails to Hot/Active Prospect Leads. The Coveted Group charges a Marketing Commission of 9% for this option.
Please note that the total resale commission will be the Base Sales Commission plus the Marketing Commission if the seller opts for a Prime or Premium Upgrade Listing.
Initial Process
To initiate the resale process, the seller must first enter into an exclusive, one-year listing agreement with The Coveted Group, wherein they pledge to pay the full commission as outlined in the agreement, regardless of the prospective buyer's source.
The Coveted Group will verify the seller's eligibility to resell their inventory by communicating with Flora Investments in writing to confirm that the seller is in good standing and has no outstanding payments or obligations related to Annual Management Fees or other pending amounts. If applicable, Flora Investments will also be given the notice to exercise their right of first refusal. This process typically takes between 5-10 business days.
Upon confirmation of the seller's eligibility and non-exercise of the right of first refusal, The Coveted Group will officially list the seller's inventory as per the terms of the Listing Agreement.
The seller must also digitally sign an Anti-Money Laundering Affidavit and a Release of Liability document.
Sales Process
Once a suitable prospect expresses interest in purchasing the seller's inventory, The Coveted Group will draft a formal offer (Offer to Purchase) on behalf of the Seller. The balance would be due within 30 days.
The Coveted Group will facilitate the transaction by drafting a formal offer and collecting a deposit on behalf of the seller. The balance would be due within 30 days.
The Coveted Group will then prepare the purchase documents for Flora Investments to review, which typically occurs on the same day or the next. The purchase documents will be sent to the buyer and seller for signature upon approval. The Coveted Group will provide guidance and walk the buyer through all clauses of the documents either in person or through a video call. The buyer will be required to initial and sign where necessary. This process may take place on the same day of purchase, but in some cases may take several days or weeks, depending on the buyer's availability.
Closing Process -for Closed Inventory
The following outlines the closing process when the sold inventory has already been formally closed. In this case, only one formal closing between the seller and the buyer is required to finalize the purchase:
Upon receipt of funds by the escrow service provider, the buyer and seller will execute a Limited Power of Attorney granting Flora Investments the authority to act on their behalf in the closing process. As stipulated in the agreement, all closing fees must be paid by the buyer.
Flora Investments will then arrange and execute an official closing at a Notary of their choosing, with any fees associated with the closing to be paid by the buyer before proceeding.
Upon successful completion of the closing, the escrow service provider will distribute the funds according to the terms of the escrow agreement, including any applicable capital gains tax, service fees, and disbursement to the seller.
Closed Inventory Fees
Only one formal closing is required between the Seller and the Buyer to finalize the purchase. The Seller will be required to pay Flora Investments a service fee of $2,775 USD + IVA, which includes the following breakdown:
Demand Statement: $100, which includes but is not limited to current owner balances for Initial Reserve Contribution, Ordinary & Special Assessments, Flora Amenity Use Fees, and/or any other applicable fees that may restrict the potential Seller from being in Good Standing for eligibility to Sell.
Transfer Fee: $275
Resale Package Fee: $150, which includes, but is not limited to, Condominium Regulations, Internal Use Regulations, Annual Budgets, and Flora Amenity Use Regulations.
Coordination and Tracking Fee: $1,500 to request, track, and process all required closing documents and coordinate with the Closing Agents, Government Authorities, Fiduciary, and Notary, among others.
Legal Representation Fee: $750 for a Flora representative to close on behalf of the Seller.
Closing Process -for Unclosed Inventory
The following is the process if the inventory has not been formally closed. In this case, two formal and simultaneous closings are required to finalize the purchase. Closing 1 will be the closing of the original purchase between the Developer and the Seller. Closing 2 will close the second purchase between the Seller and Buyer. This requires the following:
Once the funds are received by the escrow service provider, the Buyer and Seller will sign a Limited Power of Attorney, granting Flora Investments the authority to close on their behalf. The buyer will be required to pay all closing fees, as per each of the two purchase agreements.
Flora Investments will organize and carry out the two official and simultaneous closings at a Notary of their choice. Flora will request any fees associated with these closings. The Seller (who is also the buyer in Closing 1) is responsible for covering the closing fees related to Closing 1. As a result, an estimated 10% of the original purchase price will remain in the escrow account, according to the escrow agreement, until the closing. This 10% is retained to cover Closing 1’s fees.
Furthermore, the estimated capital gains the Seller owes on the closing date will also be held in escrow. In this scenario, the Buyer must be prepared to cover any additional closing and/or capital gains amounts related to the closings if the costs exceed the estimated figures. The Buyer is also responsible for the closing fees associated with Closing 2.
If the closing costs and/or capital gains are lower than estimated, the escrow agent will refund the difference to the seller.
Once both closings are executed, the escrow service provider will distribute the funds as per the terms and conditions of the escrow agreement(s). This includes any applicable capital gains tax (35%) due to the Mexican authorities, service fees, and distribution of funds to the Seller.
Unclosed Inventory Fees
In the case that two simultaneous closings are required, the seller will be required to pay Flora Investments a service fee of $3,500 USD + IVA, which includes the following breakdown:
Fees are the same as the Closed Inventory Fees (above), with the exception of the following Coordination and Tracking Fee, which is substituted with the following:
Double Closing Coordination and Tracking Fee: $2,225, covering the management, procurement, and processing of all necessary closing documents and coordination with Closing Agents, Government Authorities, Fiduciaries, and Notaries, among other involved parties.
Buyer’s Service Fee
Regardless of whether the inventory is closed or unclosed, the buyer will be required to pay Flora Investments a Buyer’s Service Fee of $2,250 USD + IVA, which includes the following breakdown:
Coordination and Tracking Fee: $1,500 to request, track, and process all required closing documents and coordinate with the Closing Agents, Government Authorities, Fiduciary, and Notary, among others.
Legal Representation Fee: $750 for a Flora representative to close on behalf of the Buyer.
Notice
The fees payable to Flora Investments and The Coveted Group for their services do not include any other fees or costs that may be associated with the sale of the inventory (i.e., closing costs, taxes of any kind, Notary Fees, Trustee Fees, third-party fees, special requests not outlined in this document, etc.).
The calculation of capital gains taxes provided herein is based on our current understanding of tax laws and regulations. The seller is advised to consult a tax professional to confirm the tax liability. The Coveted Group and Flora Investments and its agents shall not be held responsible for any inaccuracies in calculating capital gains taxes or any changes in tax laws or regulations that may occur upon the execution of a resale via the overall process described herein.
Please be aware that the costs and fees detailed here are not fixed and may vary; they are subject to modification without prior notification.
Commissions and fees stated herein exclude IVA (Sales Tax), which will be incorporated as law mandates.
Submit Your Inventory Today
Fill out the form below, and we will email you a Listing Agreement. Please allow one week for processing. Once we receive the signed agreement, The Coveted Group will promote your inventory.