Southern States Multifamily Portfolio Sells, Exceeding Targeted Returns For ArborCrowd Investors
Sale of Three-Property Portfolio in Alabama and Mississippi Generates Over 29% Internal Rate of Return
Marks First Transaction to Complete Investment Cycle for Real Estate Crowdfunding Platform
NEW YORK – July 23, 2018 – ArborCrowd (the “Company”), the only online platform that enables individuals to make equity investments in institutional-quality commercial real estate, today announced its Southern States Multifamily Portfolio (SSMP) investment has been realized ahead of schedule, outpacing targeted return estimates. One of the properties in the portfolio is located in Mississippi and sold in late 2017. The two remaining properties, located in Alabama, recently sold. The aggregate portfolio sales price was $25.85 million, generating an internal rate of return (IRR) of over 29% for ArborCrowd investors.
The transaction marks the first of ArborCrowd’s six deals to complete its investment cycle, and its success is a great sign of the long-term viability of the Company’s growing platform. The SSMP investment opportunity was quickly oversubscribed when ArborCrowd presented the deal on its platform in February 2017, raising over $2.1 million in just 5 days. The over 29% IRR generated by the sale of the portfolio far exceeded the targeted 17% to 20% IRR projected by ArborCrowd at the time of the offering.
“It’s incredibly gratifying to be able to deliver such strong returns for our investors. This milestone transaction reflects exactly the type of outcome we strive for and validates the rigorous underwriting process we employ on every deal we bring to the crowd,” said Adam Kaufman, co-founder and managing director of ArborCrowd. “The Southern States Multifamily Portfolio exemplifies our investment strategy of partnering with successful, experienced sponsors on multifamily projects with tremendous upside potential in markets where fundamentals and consumer demand are aligned.”
Kaufman added, “The delta in the realized returns compared to the projected returns reflects ArborCrowd’s focus on realistic outcomes in its underwriting. While other platforms may tout targeted returns that are unlikely to be achieved, ArborCrowd would rather employ realistic underwriting and outperform those projections. No one is ever upset to receive a greater return than they were anticipating.”
The portfolio, which includes Twickenham Village and Hillside Village in Huntsville, Ala., as well as Gardens of Canal Park in Robinsonville, Miss., was acquired by affiliates of the sponsor, Varden Capital Properties, LLC (VCP) and ArborCrowd, in late 2016. Following a well-executed, more than $1 million capital improvement plan and the implementation of operational enhancements, VCP sold the portfolio.
ArborCrowd is the only online platform that enables individuals to make equity investments in institutional-quality commercial real estate opportunities that were previously only available to institutional investors. ArborCrowd is backed by more than 30 years of leadership experience, as it is part of the Arbor family of companies, which includes Arbor Realty Trust (NYSE: ABR), a leading publicly traded commercial mortgage real estate investment trust. ArborCrowd leverages the Arbor family of companies’ expansive and proprietary network of successful real estate dealmakers to source its crowdfunding investment opportunities. ArborCrowd is so confident in the strength of its deals that it invests capital to acquire the transaction prior to syndicating equity investment opportunities to the crowd. This unique approach provides individuals with transparency and the knowledge of where and how their capital is being deployed. To learn more, visit www.arborcrowd.com or follow @ArborCrowd on Twitter, LinkedIn, Instagram and Facebook.
Megan Kivlehan – 646-677-1807