Equity Pledge Debt Fund 844
Type: Debt
Target: $4,000,000
Annual Return: 8.50% - 8.75%
Min-invest Amount: $10,000
Duration: 12 – 24 Months
| Fund Type | Private Equity Fund |
| Offering Amount | $4,000,000 |
| Estimated Return | 8.50 – 8.75% Annualized Return*1 |
| Investment Type | Equity Pledge Loan |
| Unit Price | $10,000 per Subscription Unit |
| Offering Date | February 2024 |
| Investment Timeline | 12 – 24 Months*2 |
| Dividend Schedule | Prepaid per 6 Months*3 |
*1 8.50% Annualized Return for Investment of 1-19 Units; 8.75% Annualized Return for Investment above 20 Units.
*2 Investors will receive a minimum of 6 months of dividend; dividends will be calculated in terms of days till Borrower repays the loan.
*3 After the first dividend period, Borrower owns 2 extension options, and investors will receive dividends accordingly at the same dividend rate.
- Project is in the prime area of Long Island City, Queens, one of the fastest-developing and popular areas near New York City. Residents can easily commute between Queens and Manhattan on multiple subway lines.
- Developer acquired the lot for $26,017,450 in May 2019 and had finished the demolition in 2023. The project construction is expected to be completed in middle 2025. The finished building will feature 118 condominiums, 1 community center, and 59 parking spots. The sale of condominiums will commence immediately after the construction is finished.
| Address | 11-36 45th Rd, LIC, NY 11101 |
| Area | Long Island City, Queens, New York |
| Lot Area | 34,500 Sqft |
| Building Area | 107,171 Sqft |
| Intended Use | 1 Community Center, 118 Condominiums, 59 Parking Spots |
| Expected Dividend Calendar | |||||||
|---|---|---|---|---|---|---|---|
| Round of Dividend | Phase | Amount | Dividend Date *1 | Counting Date | Ending Date | Dividend Period | Notes |
| First | First | $2,000,000 | No Later Than 3/5/2024 | 2/20/2024 | 8/19/2024 | 182 Days | Prepaid Dividend*2 |
| Second | $2,000,000 | No Later Than 4/5/2024 | 3/20/2024 | 8/19/2024 | 154 Days | Prepaid Dividend | |
| Second | - | - | No Later Than 9/3/2024 | 8/20/2024 | 2/19/2025 | 184 Days | Prepaid Dividend |
| Third | - | - | No Later Than 3/6/2025 | 2/20/2025 | 8/19/2025 | 181 Days | Extension Option Owned by Developer *3 |
| Fourth | - | - | No Later Than 9/3/2025 | 8/20/2025 | 2/19/2026 | 184 Days | Extension Option Owned by Developer *3 |
*1 In case of holidays and non-working days, the dividend date will be automatically postponed to the next working day.
*2 Investors will receive a minimum of 6 months of dividend; dividends will be calculated in terms of days till Borrower repays the loan.
*3 After the first dividend period, Borrower owns 2 extension options, and investors will receive dividends accordingly at the same dividend rate.
- According to the Appraisal Report provided by CBRE, as of September 2022, the project lot was valued at $27,100,000. The commercial bank that provided the construction loan valued the project at $97,000,000 in cost basis, and the final valuation is about $122,950,000 once completion.
- The short-term loan provided by CrowdFunz Fund 844 is pledged by 100% ownership of the project entity, which is valued at $49,950,000 , more than 10 times of the loan amount originated by Fund 844. Developer Key persons will also provide unlimited personal guarantee.
- Long island City is an emerging area in New York, and it’s on the other side of East River, directly facing the United Nation headquarter. The surrounding public transportation is well-developed, and there are 7 subway lines and multiple bus lines covered, making residents reach go to Queens, Brooklyn, and Manhattan conveniently.
- Currently, the population density in Long Island City has almost reached the same level of traditional prime areas in Manhattan. The population is young and has steady and growing income, which makes the local commercial and residential developments to be prosperous.
- The borrower plans to use the loan provided by CrowdFunz Fund 844 for the construction and other soft costs during development.
- Developer plans to use the project sales proceeds or cashflow from other projects to repay the loan originated by Fund 844.
- Developer has over 3-decade experience in real estate development and had established its reputation in the local market. Prior successful projects are mainly in Queens, New York, and the project developed in recent years are mainly medium size mixed-use buildings.
- Developer had collaborated with CrowdFunz for multiple times, including Fund 810 (Fund Ended), Fund 813 (Fund Ended), and Fund 829. The developer has shown its development strength and good reputation to CrowdFunz investors.
Investment Structure of CrowdFunz 844 Fund
CAPITAL STACK
| Capital Stack | Ratio | |
|---|---|---|
| Construction Loan | $69,000,000 | 56.12% |
| CrowdFunz Fund 844 Equity Pledge Loan | $4,000,000 | 3.25% |
| Developer Equity | $49,950,000 | 40.63% |
| Total | $122,950,000 | 100.00% |
- According to the Appraisal Report provided by CBRE, the property could be valued at $122,950,000 once completion. Developer equity is valued at $49,950,000, which is accounted for 40.63% in the capital stack.
- Construction loan has a balance of $122,950,000, which is accounted for 56.12% in the capital stack; the $4,000,000 equity pledge loan provided by Fund 844 is accounted for 3.25%.
- The Loan-to-value of the project is 59.37%.
- Borrower had pledged 100% ownership of the project entity to Fund 844, and developer’s key persons will provide unlimited personal guarantee to the borrowing.
Demographics in the Zip Code
| Long Island City/Astoria | |
|---|---|
| Population | 156,981 |
| Median Age | 34 |
| Born in place | New York(42.70%)/ Out of State(20.20%)/ Out of the U.S.(37.10%) |
| Race | Asian(15.00%)/White(47.60%)/Latino(27.90%)/African American（4.70%） |
| Median Family Income | $78,030 |
| Child-bearing (Under 18) | 14.9% |
| Unemployment Rate | 13.06% |
Due to its premium geographic location, Long Island City has become one of the hottest areas absorbing new real estate developments in New York. Meanwhile, more companies and residents have chosen Long Island City as the destination for business and living.
Younger population dominants in the area, and most residents are middle class professionals with jobs and stable incomes. The ethnic backgrounds are also well-diversified.
The median age of residents is 34; 14.9% of families have a child under 18 years old. Most apartments are rental. Due to the low housing inventory available for sale and high needs from buyers, the property prices are constantly going up.
* Source: NYU Furman Center, and U.S. Census Bureau, in February 2024
Residential Property Market in Long Island City
According to the data compiled by American Community Survey, as of the end of 2021, 18.9% of the residents in Long Island City and Astoria purchased home to live in. There are 95,762 homes registered, and the vacancy rate is only 3.3%, which is higher than Queens average.
In recent years, 2-4 family units are the best selling, followed by condominiums. 134 condominium units were sold in 2022.
As more mid-to-luxury condominium developments enter the market, house price in Long Island City has been steadily increasing. The median price of single-family houses was $995,000; the median price of condominiums was $612,500 as of the end of 2022.
According to the Appraisal Report provided by CBRE, Long Island City has entered a transition period of exponential growth due to New Zoning Ordinance and gentrification.
Based on the analysis provided by REIS, the underlying project is competitive in local market due to the surging demands.
*Source: NYU Furman Center, in February 2024.
Comparable Condominium Sold
* According to the data from Zillow and PropertyShark, the average unit sale price of comparable condominium units sold is: $1,257/ft².
Comparable Condominium Listing
* According to the data from Zillow and PropertyShark, the average unit listing price of comparable condominium units for sale is: $1,382/ft².
Comparable Valuation Analysis
* Source: Appraisal Report provided by CBRE.
Location
The Property is surrounded by well-developed public transportation. Multiple bus lanes allow quick commute to Manhattan, Queens, and Brooklyn. Driving to JFK and LGA takes 10 and 20 minutes.
Transportation
- Subway：E, M, R, N, W, 7 (2-min walk)
- To Midtown: 10-minute Metro
- To JFK Airport：25-minute driving
- To LGA Airport：10-minute driving
Schools
The basic education system in the area covers many elementary schools, junior high schools, and high schools. There are also many technical schools to meet young professionals’ self-development goals.
Living Facilities
In addition to well-developed public transportation, the local business environment is vigorous. Companies and government agencies has been moved to the area, and new restaurants and supermarkets have been settled.
Recreations
The surrounding recreation facilities are improving to fit residents’ need. Museums, gyms, and entertainment venues nearby are within walking distance.
Developer Company: Century Development Group.
Developer Website: http://www.centurygroupdevelopment.com/
Prior Cooperation: CrowdFunz Fund 810 / CrowdFunz Fund 813 / CrowdFunz Fund 814 / CrowdFunz Fund 829
Century Development Group was founded in 1990 as a commercial and residential development company. Company has built and is managing over 1 million square feet of real estate, with a total value of $300 million.
Developer has over 30 years of experience in building multi-family and condo properties. The ongoing projects have market value of over $420 million. Century Development Group is one of the leaders among Chinese developers in NYC.
- The loan provided by CrowdFunz Fund 844 is a short-to-mid term loan. Developer plans to use the loan proceeds as working capital to finish construction.
- The borrower of CrowdFunz Fund 844 has great reputation and credit history. The equity pledged for the loan is worth more than 10 times of the loan amount originated by Fund 844, and Developer will provide unlimited personal guarantee.
- CrowdFunz believes that under the loan agreement with clear legal rights and obligations, the short-term debt invested by Fund 844 has controllable risks and a low probability of default, making Fund 844 a feasible real estate investment opportunity for retail investors.
CrowdFunz 844 Project Rating
Subscription Agreement (Only available to accredited investors)
Appraisal (Only available to accredited investors)