Los Angeles Land Acquisition Senior Loan

10.5%
gross ann. return*
7 mo.
term remaining
B
Cash Flowing to Investors
Current Ann. Return 9.0%
Accrued Ann. Return 1.5%
Gross Ann. Return* 10.5%

Investment Details

Current Ann. Return 9.0%
Accrued Ann. Return + 1.5%
Gross Ann. Return* 10.5%
Term Remaining 7 of 18 mo.
Min. Investment $5,000
Investment Size $1,300,000
Underlying Security Senior Debt

Investment Summary

This is an opportunity to invest in the acquisition and pre-development of two commercial lots totaling approximately 13,500 SF of land located between the Hollywood and Koreatown neighborhoods of Los Angeles. The site is on the corner of Melrose and Oxford Avenues and currently consists of two single-family homes and one commercial mixed-use building. The sponsor, Index Real Estate, purchased the property for $2,100,000 and plans to go through an entitlement process to increase the amount of density allowed before ultimately developing a 30+ unit apartment building on the site.

Key Deal Points

Senior Secured Loan with Full Personal Guarantees

The Fundrise Investment is a senior loan secured by the property with personal guarantees from the sponsor.

Strong Infill Location in Heart of Los Angeles

The Project is centrally located in a very desirable area between Hollywood and Koreatown. Nearby amenities include Trader Joe’s, Pavilions, The Hollywood Farmer’s Market, Arclight Cinemas, along with dozens of restaurants, shopping and entertainment destinations all within walking distance.

Favorable Basis with Significant Sponsor Equity Investment

The Fundrise investment is at a basis of 57% LTC on the total project cost and is 62% of the initial purchase price. The sponsor has invested 40% of the total project cost (approx. $990k) as equity, providing a large margin of safety.

Projected Return Calculator

Principal
$5,000
Gross Annual Return* 10.5%
Term 18 mo.
Total Return*

Fundrise Rating

The Fundrise Rating is a letter rating ranging from A to E that provides investors with the ability to easily compare investments across the Fundrise platform. The Fundrise rating measures the relative risk-adjusted return of an investment. Learn more
B1
A
1
2
3
B
1
2
3
C
1
2
3
D
1
2
3
E
1
2
3
Category Assessment Points
Capital Senior to Fundrise 0% 0
Capital Junior to Fundrise 40% or more 1
Location Primary 1
Occupancy Vacant 3
Development Phase Ground-up 3
Sponsor’s Track Record Less than $50 million 3
Personal Guaranty Yes -1
Secured by the Property Yes -1
Overall 9 B1

The information contained in the Fundrise Rating is for informational purposes only. It is impersonal and not individualized for any specific investor's financial situation and is not investment advice. These ratings are not intended to be, nor should you interpret them to be, a prediction of how a particular investment will actually perform. You should always carefully consider investments in any security and be comfortable with your understanding of the investment. You may also consider consulting investment professionals.

Risk-Adjusted Return

Capital Structure

Type Source % of Total Amount
Equity Sponsor and LPs 43.3% $991,540
Senior Debt Fundrise Investment 56.7% $1,300,000
Total 100.0% $2,291,540

Property Summary

The sponsor plans on doubling the buildable area allowed under current zoning from 20,232 square feet to 40,464 square feet over the next few months, at which point Fundrise has agreed (only during the initial term) to advance an additional $275,000 which will bring the loan balance to 75% of the acquisition price.

Address 4918 Melrose Avenue
City & State Los Angeles, CA
Neighborhood Melrose Avenue
Product Type Land Acquisition / Planned Residential
Project Phase Ground-Up / Pre-Development

Market Summary

The Koreatown submarket is an up and coming area just west of the downtown of Los Angeles that has a large amount of restaurant and retail space. Koreatown is one of the most popular and hip neighborhoods in Los Angeles. Following the 1992 riots, the neighborhood was burned out and suffered significantly as a result. The neighborhood did not start to turn around until the late 90s when Korean investors started buying property as a way to protect cash investments during the Asian Financial Crisis. Since then, the neighborhood has continued to grow.

About the Sponsor

Index Real Estate Investments is the entity for which Pablo Kupsermid and Gabriel Gold are managing partners. They are experienced developers with over 20 years of real estate experience, including experience in multi-family, retail and office development.

View full profile

Fee Schedule

Gross ann. return* 10.5%
Servicing and administration fee -0.5%
Net ann. return to investors 10.0%

Other Past Investments

Atlanta Condo Pre-Development Loan

Atlanta, GA
B
Gross Ann. Return* 14.0%
Term Remaining 0 mo.
Underlying Security Senior Debt

Brooklyn 3-Unit Apartment Repositioning - Senior Loan

Brooklyn, NY
B
Gross Ann. Return* 11.0%
Term Remaining 0 mo.
Underlying Security Senior Debt