WTH? Fundrise eREIT bought my property!

[The White Coat Investor]

I had one investment with Fundrise before they decided to go the eREIT route, which I didn't like so much. The investment was a 14% preferred return on an apartment building in Salt Lake City being built from the ground up. It's been paying us 14% since July 2015 like clockwork. It was supposed to run for 36 months. Well, after 27, they've decided to sell it....to their own eREIT! I guess that's one way to get rid of their "legacy" investments.

At any rate, 100% of my principle returned and 14% returns. I guess I can't complain too much.

[Donnie]

I wonder what the regs are for something like this.  Typically it is difficult for an investment manager to transfer an asset from one fund to another since investors not common to each fund may benefit or be harmed.  Was the return to the preferred capped at 14%?  If so, I guess it doesn't matter for you, but wonder about the other shareholders.

[The White Coat Investor]

Yes, it was capped at 14% on that particular deal. And I got 14%. And the paperwork indicated the deal could end before the 36 months were up. I just didn't expect it to end that way.

[ifonlyFI]

I have seen similar sales.  It is not illegal.  One company buying property from another company.  For you, it is an early payout.  What was your final IRR?

[The White Coat Investor]

My spreadsheet

ifonlyFI wrote:

I have seen similar sales.  It is not illegal.  One company buying property from another company.  For you, it is an early payout.  What was your final IRR?

Click to expand...

My spreadsheet says the XIRR annualizes out to 13.66%. Hard to complain about that.