Editor's Note: an earlier version of this update incorrectly reported the expected annual return of this project as 8.5% through completion. The investment did indeed earn a return of roughly this amount through December 21, 2018, at which time we extended the term for a period of up to one year at a rate of roughly 7% from that date onward.
In May 2017, we invested roughly $10 million in the construction of 11 new homes in Hollywood, Los Angeles. Today, we’re excited to announce that construction is wrapping up, and the finished product looks great.
As you can see from the photos, each home features high ceilings, modern luxury finishes, a two-car garage, and a private rooftop deck with an outdoor kitchen offering expansive views of the Hollywood hills. Located just half a block from Melrose Avenue, a well-known strip with numerous shops and restaurants as well as Paramount Pictures, we believe these homes are a compelling option for affluent homebuyers in a market that is consistently short on new supply.
With construction nearing completion, the project’s sponsor has begun to list the homes for sale. The three- and four-bedroom homes are currently on the market at an asking price of $1.4 million, two of which have pending offers as of this writing.
While the project’s sponsor markets the homes for sale, our investment will continue to earn an annualized return of roughly 8.5%, as our investment risk is reduced with the sale of each home. As the lender on this project, we are entitled to our principal and interest before the sponsor can earn a return for themselves.
We look forward to providing further updates as this project nears completion.
