In May 2018, we provided a roughly $12.8 million loan for the construction of a 29-unit condo building in the Koreatown neighborhood of Los Angeles.
Over the next 18 months, construction proceeded smoothly, with only a few minor delays that are typical for a new build in a densely-populated urban area. Throughout the project, we shared several videos showcasing the property’s progress (if you haven’t already seen it, check out the latest drone video from earlier this year).
The project wrapped up major construction in September of this year, and work has started on the finishing touches, including unit interiors, landscaping, and final stucco work, with plans to secure certificates of occupancy and begin listing the units for sale in early 2021.
Having completed major construction, the borrower recently refinanced the property and paid back our loan in full with interest. We earned an annualized return of roughly 9.3% over the life of the investment, per the terms of our loan agreement.
Investor FAQ: How does this project impact your portfolio?
This investment was structured as debt, where the borrower must pay us a fixed rate of return before they can earn a return for themselves, and their equity provides us with a cushion against losses. Throughout the term of this investment, the regular income it generated supported quarterly dividends for the Income eREIT.
As always, if you have any questions or feedback, please visit our help center or reach out to us at investments@fundrise.com.
