Dear Shareholder,

We are pleased to report that as of September 30, 2022, C-REIT has closed on approximately $36.7M in investor capital, and approximately $27.3M 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 a total of two that are in the process of being finalized.

To say a lot has changed since the beginning of 2022 would be an understatement. The private CRE market, although historically less correlated to the highs and lows of the public stock market, does not operate in a vacuum. And while timely reporting and clear investor communications are always important, it can seem doubly so in times like these. 

To that end, the Office of the CIO has recently published an update to our investment thesis which is available for download here.

As we enter the next phase of the real estate cycle, we believe that nearly every asset class has the potential for growth, although the growth outlook is tempered as compared to 2021 levels. Certain assets are far from “on-sale” but continue to be driven by robust underlying fundamentals, while others show signs of pivoting off of their lows and potentially offering acquisition opportunities at relative values. Overall, with less polarization so far in 2022, we view the market as more balanced and better positioned for broader, albeit moderated, growth across the board.

Of course, the possibility of unknown shocks around the corner, good and bad, are always present. As such, we will continue to monitor markets and update our thesis accordingly. To the extent we shift our outlook, we’ll keep you apprised of our latest perspective.

As always, we want to express our gratitude for this opportunity to help you meet your financial goals

Kind regards,

PROJECT UPDATES

Kernan Oaks: Multifamily/Value-Add - $5.4M 

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 - $5.4M
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 - $4.0M
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 - $5.4M
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 - $4.1M 

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.

Add to your investment.

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.