SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT 1 to
FORM 10-K
[X] 15, ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended: June 30, 2012
OR
[ ] 15, TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 333-174445
MASCOT PROPERTIES, INC.
(Exact name of registrant in its charter)
7985 113th Street, Suite 220
Seminole, Florida 33772
(Address of principal executive offices, including zip code)
Registrant's Telephone number, including area code: (727) 393-7439
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock, $.00001 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [x]
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 232.406 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ]
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act during the preceding 12 months (or such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for at least the part 90 days.
Yes [x] No[ ]
Indicate by check mark if disclosure of delinquent filers in response to Item 405 of Regulation S-K is not contained hereof, and will not be contained, to will be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [x]
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter. The market value of the registrant’s voting $.00001 par value common stock held by non-affiliates of the registrant was approximately $24,204.
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. The number of shares outstanding of the registrant's only class of common stock, as of October 1, 2012 was 104,208,000 shares of its $.00001 par value common stock.
No documents are incorporated into the text by reference.
EXPLANATORY NOTE – AMENDMENT
The sole purpose of this Amendment to the Registrant’s Annual Report on Form 10-K for the year ended June 30, 2012 is to furnish the Interactive Data File exhibits pursuant to Rule 405 of Regulation S-T.
No other changes have been made to the 10-K, and this Amendment has not been updated to reflect events occurring subsequent to the filing of the 10-K.
Mascot Properties, Inc.
For the Fiscal Year Ended June 30, 2012
Table of Contents
PART I
ITEM 1. BUSINESS
Mascot Properties, Inc. (the “Company”) was incorporated in the State of Nevada on July 22, 2009. Our principal business is the management of real estate properties, primarily related to student housing and services which include general property management and maintenance and activities coordination for residents. We are seeking to manage properties that are near universities that suffer from a lack of on-campus housing and growing enrollment.
Both large and small universities suffer from student housing overcrowding problems. For example, some of the largest universities in the country in terms of enrollment are located in Florida and can only guarantee on-campus accommodations for freshman while other students must enter a lottery or must seek off-campus housing. Other smaller universities in the State of Florida have experienced overcrowding problems and are forced to put incoming freshman in hotels. Our planned operations will include managing income producing residential real estate properties near fast growing universities that are incapable of accommodating all of their current and future students as enrollment continues to grow. We do not currently manage any properties, but we are currently seeking properties to manage. Our website which is currently live but remains under construction, is located at www.mascotproperties.com.
Our management is experienced in the real estate industry and has been involved in real estate development projects for over 7 years, including roles as developer and manager for multifamily developments, condominiums, and apartment buildings. Currently, we are reliant on the experience of our Founder, President and management, Mr. David Dreslin. Mr. Dreslin is a CPA with twenty six years of business experience, the past seven years of which he has been actively involved in numerous real estate projects as both principal and advisor. Additionally, Mr. Dreslin has been a licensed real estate sales associate since June of 2006. Mr. Dreslin was the managing member of 4 limited liability companies engaged in the acquisition and development of approximately $30,000,000 (as retail price) of single family homes, condominiums and multi-family housing. Mr. Dreslin was involved in all aspects of the acquisition and development of various properties, including floor plan design, implementing sales staff as well as providing expertise in cost analysis regarding development and selling price in order to maximize member value. The Company believes that Mr. Dreslin’s experience will put the Company in a position to carry out its business plan while keeping its operating expenses low until such time as additional administrative staffing becomes necessary. The Company does intend to employ additional qualified employees or third-party vendors in the future, but only after it has secured contracts for the management of properties. Property management employees will be employed on a commission only
basis and will typically be paid a management fee between 2% and 5% of the gross monthly receipts of the property depending on specific requirements of each property.
Management will be charged with reviewing and recommending suitable projects for the Company consistent with its policies and objectives to maximize the return on properties it manages. We intend to manage properties and lease them to students. We will operate the properties as the property manager, which includes, but is not limited to, collecting rent, advertising, showing and leasing units in the buildings, coordinating with service professionals for maintenance and repairs, arranging promotional events for marketing, and creating activities for the residents. Management’s goal is to work toward improving the properties’ cash flow through proper marketing. We will find experienced property managers and make our properties “student friendly” with facility events, common areas for entertainment, activities and recreational facilities. The Company has not identified any specific properties to manage but, we are targeting properties with occupancy rates in excess of 96%.
We draw on the experience of our management to provide research and economic and statistical data in connection with the Company’s activities. According to statistical research on college enrollment by the Chronicle of Higher Education, 18.6 million students were enrolled in college in 2010, up from 18.4 million in 2009. This rate is expected to grow steadily to 19.2 million by 2013, and 20 million by 2017. Additionally, according to the Chronicle of Higher Education, research has shown that student housing tends to rent at a premium compared with conventional apartment communities. For example, consider a four-bedroom apartment with four students paying $500 per month each. That $2,000 monthly rent may be as much as 30% higher than the apartment norm for a particular geographic area. Parents typically guarantee rents and pay higher security deposits to ensure safe housing with amenities that students can enjoy. According to a study by Community Development Studies Market Research in 2009, 75% of incoming freshman live on-campus, the occupancy levels on-campus are 99%, but only 20% of the total student population lives on-campus.
Thus, the Company's management plans to search for opportunities to manage real estate properties near rapidly growing universities and colleges that suffer from a lack of on-campus housing, and obtain for the Company such services as may be required for property management. These fast growing universities face increasing enrollment at a rate faster than new dormitories are being built. We intend to capitalize on the inability of universities to meet expanding housing demands by looking for distressed real estate near such universities and working with the owners of these properties to convert their properties into student housing. Universities that we have targeted include local colleges in the vicinity of our Company’s base of operations in Seminole Florida. There are approximately 50 colleges and universities within a three hour drive of our principal offices.
We will continue to seek out opportunities to manage real estate properties and intend to enhance our capabilities by adding personnel or entering joint ventures with similar firms. Once we identify suitable real estate projects for property management, we will work with the owners of the properties and the residential housing office of the nearby university to create favorable living environments for students. Such property owners may include banks, investment funds, developers and individual owners; our management intends to utilize its contacts among these entities to facilitate such relationships. The Company plans to attract residents through marketing and advertising on-campus, web and social media and local radio and newspaper. We have no property management contracts at this time nor have we entered into any discussions with any such potential owners or to affiliate with any universities.
Our Operating Strategy
We seek opportunities to manage real estate properties where we believe we can achieve higher cash flows and capital appreciation for the owners as a result of our property management efforts and relations with universities’ student residential housing offices. The Company currently has no official university relationships but has had some preliminary discussions with universities as part of our due diligence. However, the Company has one college within two miles of its office, ten colleges or universities within a 25 mile radius including a major state university with more than 46,600 students, and approximately 50 colleges and universities within a three hour drive of its office and will look to establish relationships with many of these universities. Our strategy for achieving our goals consists of the following elements:
Our initial focus is on the southeastern and southwestern regions of the United States, particularly where we perceive there to be the potential to manage properties near fast growing universities whose enrollments exceed their capacity for on-campus housing. We believe we can enhance the value of these properties through the execution of our strategy which entails establishing a relationship with the local college or university, hiring a strong local property manager, aggressive marketing of the property, and adding amenities and security to the facility to cater to student’s needs. We intend to have leases and services that cater to students and will have professional on-site management and maintenance. However, we will not limit our services to any particular individual geographic markets or submarkets. Moreover, we will not restrict our services to certain locations in markets or submarkets, as we may find value-adding opportunities in large
metropolitan areas, suburban submarkets, smaller cities or rural locations, near both public and private universities.
According to the 2010 National Multifamily Report by the national real estate valuation firm Marcus & Millichap, the cap rate (the metric for determining property value based on income and cash flow) for student housing increased 50 basis points in 2009, while the average price rose 5%. According to the report, both measures outperformed those for traditional apartments.