Despite what was an eventful (if not hectic) three months for markets globally, the Fundrise portfolio delivered its sixth straight quarter of positive returns for investors with strong performance across all three major asset classes including: real estate, private credit, and venture capital.

As before, these results stemmed primarily from the strength of the portfolio’s underlying fundamentals (e.g., the right assets, in the right locations, at good cost bases) combined with an exceptional level of operational discipline and rigor that has become a hallmark of the team’s execution.

And while it may feel as though several years worth of events have already transpired in just the past six months, we continue to feel that the case we made for real estate in 2025 remains as compelling today as it did to start the year.

Strong fundamentals drive continued results

The first six months of the year delivered a series of notable wins that underscore not only the strength of the portfolio’s position but continued operating excellence by the team:

  • Residential portfolio weathers storm - The residential portfolio has weathered the challenges of oversupply better than most, delivering net positive rent growth, and now stands well positioned to benefit from the coming lack of supply in nearly every market.
  • Strategic financing at scale - We continue to opportunistically take advantage of attractive financing including a new $353 million industrial portfolio loan with Goldman Sachs and an extension of our $770 million SFR/BTR credit facility with J.P. Morgan.
  • Investing in data centers - We’ve significantly increased our exposure to the data center space investing approx. $84 million into data center backed investments in just the past five months.*
  • Income Fund increases yield - We’ve grown the Income Fund distribution rate to an attractive 7.75% annualized and originated an additional $50 million in high-yielding preferred equity investments over the past several months.
  • Venture portfolio remains elite - The venture portfolio continues to be extremely attractive by nearly any measure with more than 50% of the portfolio's assets invested in top private companies such as OpenAI, Anthropic, Databricks, Anduril, Ramp, and Canva; including all six of the Forbes Top 100 Cloud Companies.

The sustained case for real estate

As stated at the beginning of the year, we believe the case remains strong for both real estate and private markets to continue to perform well through 2025 and beyond.

The primary drivers of this remain:

  1. Relative pricing - Real estate and other private market assets remain (still) relatively inexpensive when compared to stocks (which got cheaper for a few months only to return recently to all time highs).
  2. Interest rate forecast - Interest rates, still, have yet to come down despite slowing growth, lower inflation, and the Fed’s own forecast for a sustained series of cuts.
  3. Limited new supply - What was expected to be a relative general lack of new development has turned into a near standstill, driving even lower supply forecasts for the next several years, in turn leading to even stronger rent growth forecasts in many markets.
  4. Business-friendly policies - Most of the likely business-friendly policies of the new administration are yet to be implemented with the most recent round of tariffs serving mostly to drive up construction costs, increasing values for existing assets.

Looking ahead

Despite the more recent calmness in markets, as we said at the end of the first quarter, we expect the numerous and varied new policy changes to translate to both slower overall economic growth and ongoing volatility.

Fortunately, thanks to many years of disciplined (if not boring) execution, we continue to believe that the Fundrise portfolio will remain in the generally more enviable position of potentially benefitting from both long-term secular drivers and more near-term second and third-order consequences of the ongoing policy shifts.

As always, we greatly appreciate the trust that our investors have placed in us, and welcome any feedback or questions.

*This includes investments in asset backed securities that are currently allocated and awarded but may not have closed as of the time of this writing.

Additional Information: An investor in the Fundrise Income Real Estate Fund (the “Income Fund”) should consider the investment objectives, risks, and charges and expenses of the Income Fund carefully before investing. The Income Fund’s prospectus contains this and other information about the Income Fund and may be obtained here. Investors should read the prospectus carefully before investing.