As part of our broader strategy of building new homes in major cities with a housing shortage, we’ve invested roughly $3.1 million in the acquisition of a 26,500 square foot (0.6 acre) property in the Eagle Rock community of Los Angeles, as the site of a future housing development.
Business plan
The project’s sponsor aims to obtain the entitlements to build 17 small-lot homes on the property. At this point, they expect to pay back our loan by either obtaining financing to begin construction on the homes, or selling the shovel-ready site to another builder.
Why we invested
- Experienced local partner: WJK Development specializes in building homes in southern California. With approximately 45 projects in progress and 20 completed, their track record is valued at more than $56 million.
- City-wide housing shortage: LA home prices have grown much faster than incomes in recent years, resulting in a major affordability crisis within the city. With large sections of the city simply out of reach for many renters and homebuyers, we believe that investments which create reasonably-priced new homes will deliver attractive long-term returns. See our LA market analysis.
