We are pleased to report that as of October 31, 2022, C-REIT has closed on approximately $38.5M in investor capital, and approximately $22.7M has now been invested or slated for specific projects that were approved by the Investment Committee. As of today, we have closed on and funded four projects and have submitted Indications of Interest to two additional projects that we are excited about and that are in the process of being finalized.
We’re also pleased to announce the release of CrowdStreet Advisors’ track record. We’re starting November with nearly half a billion dollars under management across 27 funds and privately managed accounts. To date, we’ve seen 16 deals come full cycle across seven of these funds, resulting in an average 26.53% realized net-to-investor IRR and a 1.71x equity multiple.1 We’re proud to announce these results to our investors and appreciate the opportunity to put our expertise to work for those who have entrusted us with their hard-earned capital.
While looking back has its merits, in today’s unsteady and volatile economic environment, our focus on the future cannot be overstated. As we continue to fill out C-REIT, we’re looking for not just great opportunities, but opportunities that make sense right now. We’ve built a fund that is not only versatile, but adaptable as well. As market shifts occur, we’re able to pivot to capitalize on newly presented opportunities. We believe ongoing economic and market volatility will continue to offer re-pricing opportunities, opportunities that C-REIT is ready to capitalize on. As the economy continues to find its footing, we intend to take advantage of timely opportunities on behalf of C-REIT investors.
For those that have invested, thank you for working with us to make this fund possible. For those that are interested in learning more, our investor relations team is waiting for your call.
Kind regards,
*Based on internal CrowdStreet Advisors data as of 11/1/22.
Important Reminders
Offers Due by November 29th to be included in the November close. Funds Due by November 30th to be included in the November close.
Note that offers and funds received after the close date will be processed in the next closing period.
C-REIT Quarterly Investor Update Webinar
Thursday, December 15, 2022
10:00 AM PT / 1:00 PM ET
Each quarter, the C-REIT portfolio management team hosts an update webinar with Q&A session for the Fund.
The updates will include a brief recap of the Fund’s investment strategy and thesis before the team provides investors with updates related to performance, new deals added and/or positions exited, as well as current market conditions and insights from our ongoing research.
PROJECT UPDATES
Kernan Oaks: Multifamily/Value-Add
Kernan Oaks represents an exciting opportunity to acquire a multifamily asset at an attractive basis and capitalize on continued favorable market fundamentals among the young family/professional demographic in the Jacksonville submarket of Florida. The sponsor, Element Property Group, is a tenured operator in the submarket and plans to achieve targeted renovation premiums of 30-45% through a unit conversion program from student housing to conventional apartments and completing some exterior upgrades. Element has successfully implemented a similar conversion strategy at two other properties. They have also made a $3.6M (13.6%) co-investment in this property. After purchasing Kernan Oaks for $87 million, Element plans to exit the project in year three through a sale at an estimated $118.2 million and an exit cap rate of 5.25%.1
Society Nashville: Multifamily/Development A to-be-built 16-story, Class-A mixed-use development that, upon completion, will feature 502 rental units (~320,000 rentable square feet) with dedicated amenity space and ~8,000 square feet of retail space. The property is well-located in one of the fastest-growing submarkets of Nashville, TN, which had the highest unit trade per square foot of any other multifamily project in the city.2 The project has achieved entitlements, a completed guaranteed maximum price (“GMP”) contract and is on track to be delivered by Q4 2024.
Huntley Commercial Center: Industrial/Development The development is the first of a two phase state-of-the-art cross-dock distribution facility located in northwest Chicago’s “Golden Corridor”. The sponsor is making a substantial 30% co-investment and anticipates a 20-month construction phase. Site is within a foreign trade zone that will allow companies that engage in international trade and use foreign trade zone benefits to receive preferential tax treatment.
Atlanta Financial Center: Office/Value-Add An iconic centerpiece of Atlanta, GA’s prestigious Buckhead submarket, a preeminent technology and financial services submarket in the Sunbelt, known as the “Silicon Valley of the Sunbelt.” Sitting on 10 acres in the center of Buckhead, the property totals 914,774 square feet of Class A office space among three interconnected office towers, spanning 12, 19, and 11 stories. A 9-story, 2,335 space on-site parking garage is included – one of the largest parking garages in Buckhead. The Sponsor is acquiring the property at a steep discount via an off-market transaction. The business plan is to implement a lease-up strategy and reactivation of underutilized retail space to deliver a Class-A office building at a significant discount to comparable new construction.
North Park Apartments: Multifamily/Development
A 125-unit, eight-story luxury apartment community in the Balboa / North Park neighborhood of San Diego, CA. The project will consist of 125 units, of which ten will be affordable, and 115 will be market rate, while also offering ground floor retail amounting to 3,000 SF. Upon completion, the property will benefit from Class A amenities, including a fitness center, club room, conference room, bike storage, private outdoor courtyard, and amenity pool deck. The Sponsor plans on reaching stabilization in month 27 and exiting at the end of month 36 at a 4.25% exit cap rate.3
1. This information in this communication, including information regarding this forecast, its estimated price and exit cap rate, is provided by the Sponsor of the investment opportunity. Though CrowdStreet believes the information contained herein has been obtained from sources believed to be reliable, they make no guarantee, warranty or representation of it.
2. Source: CoStar Group
3. This information in this communication, including information regarding this forecast, its estimated price and exit cap rate, is provided by the Sponsor of the investment opportunity. Though CrowdStreet believes the information contained herein has been obtained from sources believed to be reliable, they make no guarantee, warranty or representation of it.
CIO INSIGHTS
IN CASE YOU MISSED IT: OUR OUTLOOK FOR REAL ESTATE INVESTING
The Office of the CIO has updated CrowdStreet’s investment thesis to reflect our current thinking on the markets and private commercial real estate investing.
For shareholders that would like to add to their current investment in C-REIT, you can always schedule some time with a member of the IR team using this link, or you can reach out to the team directly via email at funds@crowdstreet.com.
1) Based on internal CS Advisors data as of 11/1/22. We calculate IRR, or Internal Rate of Return, for individual realized deals based on each Fund’s respective invested capital and distributions received, utilizing the XIRR function in Microsoft Excel and with reference to the effective capital contribution dates of each Fund as recorded in the CrowdStreet Management Console and the date of distributions as recorded in the CrowdStreet Management Console (which may vary from the actual date of invested capital or the actual date the issuer made the distribution). The aggregate IRR of all realized deals is based on aggregated cash flows of individual realized deals, as described above, and similarly calculated utilizing the XIRR function. IRR figures listed on this page are net of the most onerous annual fees charged to clients on a quarterly basis, which is equal to the product of the amount of invested capital into each realized deal multiplied by 1.75%; an investor’s actual IRR on a realized investment may differ. We calculate EM, or Equity Multiple, for individual realized deals based on dividing each Fund’s respective distributions received by the respective invested capital; an investor’s actual EM on a realized investment may differ. We utilize a consistent methodology for calculating returns. However, in most cases, the applicable issuing entity provides the distribution information. used for our IRR and EM calculations. While we take reasonable steps to verify this information, we cannot guarantee its accuracy. 2 The aggregate returns are a roll-up of the individual deal-level cash flows for the seven CS Funds that have realized deals come full cycle. As such, the same calculation was used.
CrowdStreet, Inc. (“CrowdStreet”) offers investment opportunities and financial services on its website. Advisory services are offered through CrowdStreet Advisors, LLC (“CrowdStreet Advisors”), a wholly-owned subsidiary of CrowdStreet and a federally registered investment adviser. CrowdStreet Advisors provides investment advisory services exclusively to privately managed accounts and private funds and does not otherwise provide investment advisory services to the CrowdStreet Marketplace or its users.
Performance information presented in this material has not been audited or verified by a third party.
This is for informational purposes only and should not be regarded as a recommendation, an offer to sell securities, or a solicitation of any offer to buy any investment products, financial products, or services.
CrowdStreet makes no representation or warranty, express or implied, in relation to the fairness, accuracy, correctness, completeness, or reliability of the information contained in this report. CrowdStreet does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this report or for any decision based on it.
This communication should not be construed nor is it intended to be a recommendation to purchase, sell or hold any security or otherwise to be investment, tax, financial, accounting, legal, regulatory or compliance advice. This communication does not establish an attorney-client relationship or constitute legal advice. Past performance is no guarantee of future results or success. Investors should consult with a financial advisor, attorney, accountant, and any other professional that can help in understanding and assessing the risks associated with any investment opportunity.
Investing in commercial real estate entails substantive risk. You should not invest unless you can sustain the risk of loss of capital, including the risk of total loss of capital. All investors should consider their individual factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate. Direct and indirect purchase of real property involves significant risks, including without limitation market risks, risks related to the sale of land and risks specific to a given property, which could include the potential for property value loss, potential for foreclosure, changes in tax status and fees, and costs and expenses associated with management of such properties. All investors should consider risks specific to that given property prior to investing. An investment in a private placement is highly speculative and involves a high degree of risk, including the risk of loss of the entire investment. Private placements are illiquid investments and are intended for investors who do not need a liquid investment.
This email contains realized performance calculations. The calculations partially rely upon the sponsor’s data, explanations, and the information contained within sponsor-produced quarterly reports. These calculations are not an assertion of independently verified facts but, rather, is for informational purposes only, to convey CrowdStreet’s understanding of what transpired. CrowdStreet makes no representation or warranty, express or implied, in relation to the fairness, accuracy, correctness, completeness, or reliability of the information contained in this report. CrowdStreet does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this report or for any decision based on it.
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All prospective investors must certify that they are accredited investors, and provide either supporting documents or third party verification, eligible for this type of illiquid investment, and must acknowledge that they have received and read all investment materials. Direct and indirect purchase of real property involves significant risks, including without limitation market risks, risk related to sale of land and risks specific to a given property. The securities offerings posted on the website are speculative. Investments posted on this website are NOT insured by the FDIC or by any other Federal Government Agency, are NOT Bank deposits, are NOT guaranteed by CrowdStreet, (or any of its affiliates) and MAY lose value.
Neither the SEC nor any federal or state securities commission or regulatory authority has recommended or approved any investment or reviewed the accuracy or completeness of any of the information or materials posted on the website. Neither CrowdStreet nor any of its directors, officers, employees, representatives, affiliates or agents shall have any liability whatsoever arising, for any error or incompleteness of fact or opinion in, or lack of care in the preparation or publication, of the materials and communication herein or the or that the valuation of any securities offering is appropriate. Past performance is not indicative of future results. The website may contain forward-looking statements, which may include words such as “may”, “will”, “should,” “expects,” “plans,” “anticipates,” “believes,” “targeted,” “projected,” “estimates,” “predicts,” “potential,” or “continue”. CrowdStreet is under no obligation to review or update such statements and actual results may vary materially therefrom. Nothing herein shall be relied upon as a promise or representation as to past or future performance. All investors must make their own determination of whether or not to make any investment, based on their own independent evaluation of the investment and their risk tolerance.
CrowdStreet Advisors, LLC (“CrowdStreet Advisors”) is a wholly-owned subsidiary of CrowdStreet and a federally registered investment advisor (CRD# 299176). CrowdStreet Advisors provides investment advisory services exclusively to privately managed accounts and certain funds it manages, and does not otherwise provide investment advisory services to the CrowdStreet Marketplace. CrowdStreet, Inc. (“CrowdStreet”) offers investment opportunities on this website (the “CrowdStreet Marketplace”).