McKenzie Ridge

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Location

Sisters is a high-demand leisure destination with approximately 55,000 annual visitors and a strong regional identity centered on outdoor recreation, festivals, and mountain access. Infill lodging near the urban core is scarce, and the city restricts short-term rentals in residential zones.

McKenzie Ridge sidesteps this constraint by operating under the commercial hotel classification.

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Executive Summary

McKenzie Ridge is a fully entitled 0.56-acre development site located at 704 West Hood Avenue, Sisters, Oregon. The property sits on the west edge of downtown and offers direct access to the Cascade Mountain corridor. The approved development converts the commercial site into 11 fee-simple lots supporting 10 standalone, two-story vacation lodging units plus an HOA-controlled storage building.

Units range 1,061–1,180 sq ft with private deck and balcony space.

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Entitlements and Infrastructure

Entitled and permitted for lodging use

 

Commercial zoning classification, not residential

 

Not subject to the City’s vacation rental caps

 

Fee-simple ownership creates exit optionality for investors

 

Includes construction-ready drawings and site plan approvals

* Oregon law tightly limits development, keeping new master plans scarce, while Deschutes County has a moratorium in place for new Destination Resort Developments.

Deschutes County grew ~12.4% (2019–2023) underscoring sustained in-migration.

For Third Salt Venture Fund investors, real estate buyers, and stakeholders, constrained entitlements plus strong demand translate into durable pricing power and long-run value.

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Financial Overview

Target Pricing

• Forestry-facing units: $349,999

• Cascade-facing units: $369,999

• Optional mudroom: $25,000 premium

 

Operating Model

Stabilized ADR: $202.50

Stabilized occupancy: 59.17%

Annual gross income per unit: $42,174

 

Investment Metrics

Construction loan LTV: 56.71%

Total project IRR on equity: 134% (12-month assumption)

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Build Program

Each unit is delivered with

 

• 2 bedrooms or flex bunk option

 

• Private terrace and deck

 

• Modern, northwest-inspired architecture

 

• Materials and finishes specified in approved plans

 

• HOA-managed storage building supporting 10 units

 

Vertical construction schedule, pro forma, and cost stack are complete and ready for contractor onboarding.

Market Position

Strong demand from affluent buyers seeking lifestyle real estate post-pandemic

Median home price in Central Oregon: $800,000+

Comparable hospitality projects demonstrate strong pricing power and absorption

Fund Investment: Options

Hold and operate units individually

 

Sell on a per-unit basis at retail prices

 

Aggregate and exit as a stabilized lodging portfolio

 

Convert operational footprint into brandable hospitality concept

Request Allocation Consideration

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Disclaimer: Investments in the Fund are speculative, involve significant risks including possible loss of the entire investment, and are not insured by the FDIC or any other government agency.  Any investment opportunity will be made only through the Fund's official offering documents, which include important details about risks, fees, and restrictions.  [Review Full Disclosures]