We’re pleased to announce a new addition to your Fundrise portfolio: a preferred equity investment in a 312-unit ground-up multifamily development in Charlotte, North Carolina.

Investment overview

  • Investment type: Preferred equity
  • Annual gross interest rate: 14.75%1
  • Location: Charlotte, NC (North Charlotte submarket)
  • Asset type: 312-unit ground-up multifamily development
  • Investment term: 4 years (with option for 12-month extension)
  • Funds: Income Real Estate Fund and Opportunistic Credit Fund II

The North Charlotte Development will feature five four-story elevator-served residential buildings alongside seven townhome buildings, a combination that gives this community a product variety uncommon in new multifamily construction and one that positions it differently from the standard apartment supply competing for renters in the market. Units range from 863 to 1,494 square feet, averaging 1,113 square feet, and include attached garages, nine-foot ceilings, private porches and patios, in-unit laundry, and large walk-in closets. Community amenities include a resort-style pool, fitness center, clubhouse and leasing center, dog park and pet spa, community parks and green spaces, grilling stations, conference rooms, and electric vehicle charging stations.

Local market insights from RealAI

Charlotte has built one of the Southeast’s most structurally sound labor markets. RealAI reports that job growth over the past five years reached 18.1% against a national rate of 7.3%, driven by the city’s concentration in financial services (11.3% employment share versus 6.6% nationally) and a broad professional economy where 44.8% of workers are employed in professional or creative occupations. Labor force participation stands at 68.8%, well above the national 64.0%, a gap that reflects genuine economic engagement rather than population growth alone.

The migration picture reinforces this. Charlotte is attracting higher-earning, more-educated residents, population is growing at 1.3% annually against the 1.0% national rate, renter median income of $60,302 runs 8% above the national renter peer group, and median household income of $91,034 ranks in the 88th percentile nationally.

The near-term picture is more nuanced, and worth addressing directly. In-place rents are growing at just 0.5% annually, and asking rents have declined 5.2% over the past year as a wave of new supply has been absorbed across the metro. New lease tradeouts are negative (-1.7%), meaning landlords are offering concessions to hold occupancy. This is not a secret; it is the condition that shapes the opportunity. Multifamily permitting has declined 21% year-over-year, signaling that developers are pulling back from new construction in response to current conditions. And the market’s rent-to-income ratio of 30.5% sits comfortably below the national 35.7%, providing meaningful headroom for rent recovery as supply normalizes.

Why this matters

This deal reflects a dynamic we often find attractive in ground-up preferred equity: the opportunity to lock in a high fixed return during a period of near-term market softness, backed by fundamentals that remain intact. The 14.75%1 gross rate is among the highest preferred equity yields in the current portfolio, a return that reflects the development-stage risk premium we are being compensated for at a point in the cycle when many capital sources have stepped back from new construction financing.

The community’s format is also a deliberate differentiation. The combination of apartment buildings and townhome-style units with attached garages and private outdoor space serves renters who want the space and privacy of a single-family home without the cost of ownership, a profile that standard urban apartment product largely ignores. In a market where concessions are common, that specificity matters at lease-up.

The sponsor has completed over $4.5 billion in multifamily transactions — 32,000 units acquired, developed, or financed, with roughly 4,000 more currently under construction. This is Fundrise’s fifth investment with them, a relationship built on a track record of executed projects and shared underwriting discipline. As with all of our private credit investments, this position is backed by a tangible physical asset with real equity behind our position. For a deeper look at how our approach differs from other corners of the private credit market, read our update, Private Credit: What You Should Know.

The 14.75%1 gross return contributes to the Income Real Estate Fund’s current 8.15%2 annualized distribution rate while also supporting the Opportunistic Credit Fund II’s current 11%3 distribution rate. This ground-up development position reflects our conviction in sourcing opportunities where we can capture returns from the earliest stages of value creation, backed by disciplined underwriting and strong sponsor relationships.

If you have any questions, feel free to reach out to our Investor Relations team at investments@fundrise.com.

1. This solely represents a fixed rate of preferred return due to the Fundrise Income Real Estate Fund and Opportunistic Credit Fund II under the terms of their investment agreement(s), and does not reflect either a gross or net return that an investor may expect to receive as a result of this fixed rate return. Due to the uncertainty of other factors that will ultimately determine the return to any investor (such as leverage, cash drag, and other potential financings), the performance of this asset to the investor is currently unknowable and undeterminable, and may ultimately be lower or higher than the stated fixed rate of preferred return. However, please note that all investors in the Opportunistic Credit Fund II will be subject to a 1.75% fund management fee, and, if the Opportunistic Credit Fund II is able to achieve a greater than 10% overall return on its portfolio, which is also uncertain and undeterminable at this time, then the asset will also be subject to an additional 20% performance-based fee for those Opportunistic Credit Fund II investors.

2. As of August 2026. The Income Real Estate Fund's current month’s distribution is annualized and divided by the prior month’s net asset value per share.

3. As of August 2026. The Opportunistic Credit Fund II’s current month’s distribution is annualized and divided by the prior month’s net asset value per share.

Disclosure: An investor in the Fundrise Income Real Estate Fund should consider the investment objectives, risks, charges, and expenses carefully before investing. The Fund's prospectus contains this and other information and may be obtained here. Investors should read the prospectus carefully before investing.