Equity Pledge Debt Fund 824
Type: Debt
Target: $4,000,000
Annual Return: 7.75% - 8%
Min-invest Amount: $10,000
Duration: 12 - 24 Months
| Fund Type | Equity Pledge Debt Fund |
| Offering Amount | $4,000,000 U.S. Dollars |
| Estimated Return | 7.75% - 8.00% Annualized Return |
| Investment Type | Equity Pledge Loan |
| Unit Price | $10,000 per Subscription Unit |
| Offering Date | May 2022 |
| Investment Horizon | 12 – 24 Months |
| Dividend Schedule | Prepay Before Per Period (12+6+6 Months) |
*1: 7.75% Annualized Return For Investment of 1 -19 Units;
8.00% Annualized Return for investment above 20 Units.
- Developer purchased the project lot in December 2021, and the building plan has been approved. The construction started in the first quarter of 2022, and the groundwork is expected to finish in July.
- According to building plan, the property will feature 9 floors and building size of 97,000 SF. There are 87 rental units, including 21 Affordable Housing units, and 66 Market Rate Rental units. There will also be 56 parking spots. Developer expects to receive TCO in the third quarter of 2023. 3 months after the receipt of TCO, developer will start rental operation and apply for permanent financing from commercial bank. Currently, developer is engaging with a commercial bank and expected to receive construction loan this June.
| Site Address | Woodside, NY |
| Site Area | Woodside, Queens, New York |
| Lot Size | 15,000 SF（150ft*100ft） |
| Zoning | R5B（FAR = 4.6x） |
| Leasable Area | 69,000 SF |
| Building Size | 96,994 SF |
| Post-Construction Market Value | $55,400,000 |
| Expected Dividend Calendar | ||||||
|---|---|---|---|---|---|---|
| Round of Dividend | Funding Amount | Dividend Date *1 | Counting Date | Ending Date | Dividend Period | Notes |
| First | $4,000,000 | No Later than 6/14/2022 | 6/1/2022 | 5/31/2023 | 12 Months | Pre-paid Dividend |
| Second | No Later than 6/14/2023 | 6/1/2023 | 11/30/2023 | 6 Months | Extension Option Owned by Developer | |
| Third | No Later than 12/14/2023 | 12/1/2023 | 5/31/2024 | 6 Months | Extension Option Owned by Developer | |
*1 In case of holidays and non-working days, the dividend date will be automatically postponed to the next working day.
*2 After the expiration of the first Dividend Period, the developer has 2 options to extend the borrowing by 6 months. If the developer chooses to extend, the investors will receive dividends at the same rate of return during the extension.
- Based on Appraisal Report provided by CBRE, after the project is completed and rental operation has started and stabilized, the property could be valued at $55,400,000.
- The developer has pledged the equity of the project entity to receive the short-to-mid term bridge loan provided by CrowdFunz 824 Fund.
- As of May 2022, developer has contributed total equity near $10 million, and expects to contribute additional $4 million. Total equity contribution is around 3.5 times the loan amount provided by CrowdFunz 824 Fund. Developer has also pledged unlimited personal guarantee to provide additional safety.
- Project is in Woodside, Queens, a young emerging neighborhood with strong transportation network and easy access to LIRR and other Subway lanes. The proximity to JFK and LaGuardia Airport also attracts tourists.
- Woodside community has emerged into a diverse and comprehensive business environment. Local businesses include schools, restaurants, recreation centers, and other resident-friendly facilities. As local businesses thrive, so does local real estate market.
- The project building plan has been approved, and developer is currently working on excavation and related work. Construction loan is expected to transfer in around June.
- Before construction loan comes in, developer needs a bridge loan to finish excavation work in the interim, which CrowdFunz 824 Fund will provide. When construction loan is received, developer will repay the total loan amount provided by CrowdFunz 824 Fund.
- The project is being developed by a seasoned Chinese developer. Developer has over 30 years of experience in commercial real estate development. Developer has numerous large-scale residential, mixeduse, and commercial properties, located in Queens.
- Developer had first collaborated with CrowdFunz in CrowdFunz 606 Fund in 2017. Developer not only repaid the loan in timely manner, but also made the underlying property one of the most well-known in the area. The ongoing CrowdFunz 817 Fund is progressing smoothly, proving the expertise of the developer.
Investment Structure of CrowdFunz 824 Fund
CAPITAL STACK
| Capital Stack | Percentage | |
|---|---|---|
| Mortgage Originated by Commercial Bank | $33,500,000 | 65.05% |
| Loan Issued by CrowdFunz 824 Fund | 4,000,000 | 7.76% |
| Equity Investment by Developer | 14,000,000 | 27.19% |
| Total Amount | $51,500,000 | 100.00% |
- Developer has contributed $10,000,000 of equity ,and expects to contribute another $4,000,000, in total of $14,000,000. Currently the equity contribution is accounted for 27.19% of total funding amount.
- CrowdFunz 824 Fund has originated a mezzanine loan in total of $4,000,000, which is accounted for 7.76% of total funding amount. The position is secured by the equity of project entity and unlimited personal guarantee by developer.
- Developer expects to receive a construction loan in total of $33,500,000 in June 2022, which is accounted for 65.05% of total funding amount. The loan will be distributed according to constructionprogress.
FUND USAGE
The $4,000,000 mezzanine loan provided by CrowdFunz 824 Fund will be used to cover the cost of excavation, foundation, and superstructure. (Please see chart for breakdown).
Developer had contributed $10,000,000 of equity and expects to contribute another $4,000,000 according to the progress of groundwork. The $4,000,000 provided by CrowdFunz 824 Fund will enter the project in June, to cover necessary costs before construction loan kicks in.
| CrowdFunz 824 Fund – Proceed Usage | ||
|---|---|---|
| Cost Breakdown | Amount | Percentage |
| Excavation | $400,000 | 10.00% |
| Support of Excavation | 700,000 | 17.50% |
| Foundation | 1,200,000 | 30.00% |
| Superstructure | 1,700,000 | 42.50% |
| Total | $4,000,000 | 100% |
* Data provided by Developer
Demographics in the Zip Code
| Zip Code 11377 | |
|---|---|
| Regional Population | 83,825 |
| Median Age | 40.5 |
| High School Education or above | 52.6% |
| Commute Area | Metropolitan(99.9%) |
| Family Median Income | $77,052 |
| White Collar / Blue Collar | 75.7%/24.3% |
| Child-Bearing Family | 25.5% |
| Average Family Size | 2.67 |
| Average House Price | $569,000 |
Woodside is a key transportation hub, connecting Long island and New York City. Its strong network of transportation has attracted tourists and residents.
Most residents in Woodside live a family lifestyle, therefore spend mostly on daily necessities.
Residents have an average age of 40.5 years. Child-bearing families is accounted for 25.5%. Most people purchase houses to live in. However, local real estate market has garnered huge investor interest, in turn pushing up the house price.
* Data Source：United States Zip Codes. Org. & Esri Zip Code Lookup。
Land Valuation Analysis of Underlying Property
* As of May 2022, average sale price of comparable lands is $174/SF
Comparable Residential Units for Rent
* As of May 2022, average rental price of comparable units is $51.44/SF/Year
Property Valuation Analysis by CBRE
* According to independent Appraisal Report by CBRE, once rental operation stabilizes, the property may generate $2,577,000 of net income per year, given it an estimated market valuation of $55,400,000.
* The property could be valued at $53,000,000 when operation stabilizes, given by a more conservative valuation by CrowdFunz.
Location
Project is in central area of Woodside, Queens, with easy access to transportations, including LIRR, subway, and bus. Driving to Midtown Manhattan takes approximately10 minutes.
Transportation
- Subway：7 Train (2-min walk)
- LIRR：North / South
- Bus Line：Q32, Q60
- To Midtown Manhattan ：About 10 Min
- To JFK Airport：25-min drive
- To LGA Airport：15-min drive
Nearby Schools
There are numerous primary schools, middle schools, high schools to meet the education need of local children. There are also professional schools for adults looking to advance their careers.
Living Facilities
The populated yet safe community has a strong network of transportation and local business, especially convenient for local families. In turn, the area has been seeing more real estate developments.
Recreations
The neighborhood has parks, childcare facilities, education companies, recreational centers, and museums.
Prior Cooperation: CrowdFunz 606 Debt Fund / CrowdFunz 806 Debt Fund / CrowdFunz 810 Debt Fund / CrowdFunz 813 Debt Fund / CrowdFunz 817 Debt Fund
The development is led by a seasoned Chinese American development group and an emerging New York local developer. The whole team has commercial real estate development experience for over 3 decades.
The development team has completed numerous projects including retail complex, mega residential, and mixed-use buildings in various emerging areas in Queens and New York.
Besides local markets, the team has developed over 5 million square feet of projects in the United State and China.
The team is actively engaged in not only development but acquisition, property management and sales in the past 20 years, generating constant profits for partners and investors.
- The loan originated by CrowdFunz 824 Fund is a short-tomid term debt investment which helps the developer cover foundation construction costs before construction loan arrives and helps maintain healthy liquidity and workingcapital.
- We believe that the underlying project of 824 Fund is solid, and we trust the developer’s reputation and credibility. From the perspective of capital stack, first lien construction loan is below 65% of total capital, and developer is expected to contribute $14,000,000 of equity, which is 3.5 times the total loan amount provided by CrowdFunz 824 Fund. Unlimited personal guarantee is also attached.
- We believe that the risk-return balance in CrowdFunz 824 Fund is rational. sufficient collateral based on bilateral agreements may also mitigate uncertainty before the date of maturity.
CrowdFunz 824 Project Rating
Subscription Agreement (Only available to accredited investors)
Appraisal (Only available to accredited investors)