Author Topic: Thoughts On RealtyShares Closing Its Doors To New Investors  (Read 487439 times)

babets

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1320 on: July 31, 2020, 02:34:35 PM »
Latest update on Franchise Growth:

"
The borrower (Franchise Growth) has elected to exercise their final extension of 30 days as per the agreement. The borrower has satisfied the required $35,000 non-refundable deposit to extend. The final extension expires on 8/29/2020. IRM does not plan to accept any additional extensions.


IRM has asked Franchise Growth for a status update of the asset sales. To date, no such update has been received. We estimate the chances of a sale at 50/50 with the other option still being foreclosure on all remaining assets.
"

Looks like we are on the final 30 day countdown. They have now put up $195,000 in non-refundable deposits.

It's going to be interesting to see if they can get a sale agreement closed out in the next 30 days. The cost of borrowing money is extremely cheap right now, and there's a lot of capital sloshing around... but I personally don't have much insight as to how fast food commercial real estate is doing right now. Not encouraging, although not surprising, they wouldn't give IRM any updates.

While I hope to lose as little (or none) as possible on my FS deals, I'm anxious for the saga with them to finally be over with. Even if foreclosure is in the cards, I'll be glad to not be waiting on updates from the FS folks.

Fingers crossed.


i also agree that a 195K deposit is something. i wonder what eventually happens to that deposit if sale dont happen. any idea? bcs if they lose it i would imagine the sale is a better alternative...

stingray

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1321 on: August 01, 2020, 05:51:13 AM »
Hi @babets, regarding the $195 K deposit from Franchise Growth, I think it is likely that RS will first recoup what it has spent on lawyers and then take any management fees that have accrued to date.  From whatever remains, it may hold a portion for future legal fees and distribute it to investors.  Unfortunately, I doubt that investors will see much of that $195 K.  Best of luck to you with this and all of your investments.

stingray

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1322 on: August 06, 2020, 07:25:39 AM »
Hi all, RealtyShares, Inc. has declared Chapter 7 bankruptcy.  Here is a link to the case on Pacer Monitor:

https://www.pacermonitor.com/public/case/35622255/RealtyShares,_Inc

The court notice states that RealtyShares, Inc. has no assets to distribute.

Generally, to my knowledge, investment rights and assets are held in other entities.  RealtyShares, Inc. is an administrative parent corporation.  So, this bankruptcy will not necessarily have an effect on investments.

JD

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1323 on: August 06, 2020, 08:42:56 AM »
Hi all, RealtyShares, Inc. has declared Chapter 7 bankruptcy.  Here is a link to the case on Pacer Monitor:

https://www.pacermonitor.com/public/case/35622255/RealtyShares,_Inc

The court notice states that RealtyShares, Inc. has no assets to distribute.

Generally, to my knowledge, investment rights and assets are held in other entities.  RealtyShares, Inc. is an administrative parent corporation.  So, this bankruptcy will not necessarily have an effect on investments.

Thanks for this Stingray. I suspect they are doing it because of the class actions that have been filed.

techOnFIRE

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1324 on: August 06, 2020, 10:29:39 AM »
From this paywall: https://www.bizjournals.com/sanfrancisco/news/2020/08/03/realtyshares-files-for-bankruptcy.html

“We did agree to a revenue share,” Holzmann said. “But they’re not going to get a dollar, ever.”

Holzmann said IIRR paid off the note knowing full well he’d never see any of that money again. He said the company agreed to it because he didn't want RealtyShares' problems spilling over onto his newly acquired portfolio.

“For us, it is not a huge home run but it is a solid businesses,” Holzmann said, adding that they hope to empty the portfolio in the next year or two.
----
IIRR paid off a $5M note so they will want to repay themselves with those fees which explains why we never see payouts from the 'late fee payments' they recover.

jy2005

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1325 on: August 07, 2020, 01:55:18 PM »
Hi All,

I am surprised that IIRR is taking money from our distributions, even when they handed losses to us. When we suffer losses, why they took full management fees from our principle payment? Isn't their fault to poor manage the investment asset?

It is a huge mistake to invest on RS.


Hi @babets, regarding the $195 K deposit from Franchise Growth, I think it is likely that RS will first recoup what it has spent on lawyers and then take any management fees that have accrued to date.  From whatever remains, it may hold a portion for future legal fees and distribute it to investors.  Unfortunately, I doubt that investors will see much of that $195 K.  Best of luck to you with this and all of your investments.

titlewealth

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1326 on: August 07, 2020, 07:14:43 PM »
Reading through this has me concerned about my exposure in PeerStreet, CrowdStreet, Fundrise and others...
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babets

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1327 on: August 10, 2020, 07:04:44 AM »
Does anyone is invested in the Hilton Melbourne and Double tree wilmngton with Buccini ? They just posted an update that does not look promising. Any comments?

babets

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1328 on: August 12, 2020, 06:08:07 PM »
Does anyone is invested in the Hilton Melbourne and Double tree wilmngton with Buccini ? They just posted an update that does not look promising. Any comments?

Some people keep giving me negative ratings after any post i do. Rather than hiding behind a keyboard, pls Come forward and let me know why, we can discuss.

berkel

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1329 on: August 22, 2020, 01:41:07 PM »
Reading through this has me concerned about my exposure in PeerStreet, CrowdStreet, Fundrise and others...

I have been in Fundrise since last fall and I think they have a more conservative approach.  I got burned to some extent by RealtyShares, but hopeful that I will recoup all my principal for a small net return overall (~4%).   Fundrise has have been more transparent and provided updates during COVID-19 showing how they have a net small + performance compared to the overall markets.  They are focused more on residential investments that seem to hold up better, but would appreciate any other thoughts or insights.  I "joined' RealyMogul, but have not invested.  Somewhat gun shy after my mixed experience at RealtyShares.

Thanks

schin98@juno.com

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1330 on: August 23, 2020, 10:41:57 AM »
I've had no problem with Fundrise or Realty Mogul. Not one investment has lost money. Most of my investments with Realty Mogul have made huge profits. Which has REALLY made the "Realtyshares" fiasco stand out. I've made perhaps 40 Crowdfunding investments. ALL 10 investments with Realtyshares have had problems, while ANY investment with another agency has done well. Realtyshares is really the Pig on this farm.

Hindsight2020

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1331 on: August 25, 2020, 06:08:35 AM »
I invested in 2 RealtyMogul deals, their Reit I and a mobile home rollup. Both great.

groovydude

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1332 on: August 25, 2020, 09:08:43 AM »
Reading through this has me concerned about my exposure in PeerStreet, CrowdStreet, Fundrise and others...

These platforms all require deal flow to exist, right? Without it, they perish. This causes two problems, IMHO, both of which we've all seen firsthand. First, they're likely to put deals up that are sketchy if their cashflow is in trouble (which they'll never reveal to investors), and what happens to the deals when the site goes away? I've cut way back on my crowdfunding investments since RS collapsed, but still have picked up a few. EM seems more transparent than RS ever was. Crowdstreet as well but I think it has vetting issues. For both it looks like the deals can survive on their own far better than RS if the site goes down (from my reading of the contracts). RealCrowd might be alright as well. Regardless, overall I've looked at proposals with a far more skeptical eye in the last year. Live and learn I suppose.

titlewealth

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1333 on: August 25, 2020, 08:15:39 PM »
I have an account with Crowd Street and was considering adding to it but my look into Realty Mogul again in an effort to diversify just in case something happens to these platforms. But is the timing right to put money into Real Estate right now? or better hold the cash for a couple more months?
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mspringer

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1334 on: August 31, 2020, 05:50:25 AM »
Latest update on Franchise Growth:

"
The borrower (Franchise Growth) has elected to exercise their final extension of 30 days as per the agreement. The borrower has satisfied the required $35,000 non-refundable deposit to extend. The final extension expires on 8/29/2020. IRM does not plan to accept any additional extensions.


IRM has asked Franchise Growth for a status update of the asset sales. To date, no such update has been received. We estimate the chances of a sale at 50/50 with the other option still being foreclosure on all remaining assets.
"

Looks like we are on the final 30 day countdown. They have now put up $195,000 in non-refundable deposits.

It's going to be interesting to see if they can get a sale agreement closed out in the next 30 days. The cost of borrowing money is extremely cheap right now, and there's a lot of capital sloshing around... but I personally don't have much insight as to how fast food commercial real estate is doing right now. Not encouraging, although not surprising, they wouldn't give IRM any updates.

While I hope to lose as little (or none) as possible on my FS deals, I'm anxious for the saga with them to finally be over with. Even if foreclosure is in the cards, I'll be glad to not be waiting on updates from the FS folks.

Fingers crossed.


i also agree that a 195K deposit is something. i wonder what eventually happens to that deposit if sale dont happen. any idea? bcs if they lose it i would imagine the sale is a better alternative...

Franchise Growth's 30 days is up.  I haven't seen any distributions from the previous deposits but let's hope we get some direction and action now and moving forward.

I know RS reads this board, so using this as a reminder of their due date.

techOnFIRE

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1335 on: August 31, 2020, 04:46:45 PM »
Franchise Growth's 30 days is up.  I haven't seen any distributions from the previous deposits but let's hope we get some direction and action now and moving forward.

I know RS reads this board, so using this as a reminder of their due date.

IRM emails on FG just went out.  Foreclosure to proceed with each property auctioned individually. Buckle your seatbelts.  After IRM takes their pound of flesh doubt much will be returned to investors.
Appears near full loses will occur across my RS investments.  I wish I had never found Sam's blog on crowdfunding and how he touted RS.

babets

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1336 on: August 31, 2020, 05:36:59 PM »
Franchise Growth's 30 days is up.  I haven't seen any distributions from the previous deposits but let's hope we get some direction and action now and moving forward.

I know RS reads this board, so using this as a reminder of their due date.

IRM emails on FG just went out.  Foreclosure to proceed with each property auctioned individually. Buckle your seatbelts.  After IRM takes their pound of flesh doubt much will be returned to investors.
Appears near full loses will occur across my RS investments.  I wish I had never found Sam's blog on crowdfunding and how he touted RS.

Agree. I invested over 100k bcs of Sam posts

sdnerd

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1337 on: August 31, 2020, 06:08:04 PM »
Appears near full loses will occur across my RS investments.  I wish I had never found Sam's blog on crowdfunding and how he touted RS.

I'm at least (somewhat) hopeful there will be some decent return of capital. And now that we are finally not all lumped in together and each property being treated separately the specifics of each will matter a lot more.

Just reviewing the final 3 deals I'm stuck with:

1. Detroit MSA Dog Haus in Taylor MI. The building was demolished, and roughly 50% of the funds were returned to investors. Another $50K was held back to pay for legal/foreclosure costs. The land was originally valued at nearly $1M almost 4 years ago. They also paid some interest on this one. Worse case scenario of ~40% loss if they get nothing for the land - which isn't going to happen.

2. Louisville MSA Captain D's. Google maps shows the building as fully completed and I "think" this location might have been operational for a bit so the inside might be reasonably put together still. This could be a quick turnaround for a franchiser that can run with the building mostly as is.

3. Coastal Florida Church's Chicken. Same as above; Google maps shows the building as fully completed.

I'm still expecting a decent hit, but I'm hopeful that given the state of at least those 3 deals there's some opportunities for a significant portion of the capital to be returned.

We also have the $195,000 non-refundable deposit from the FG folks. That should at least help offset some of the legal fees. And if nothing else, provide some solace that the FG folks are going to be losing a fair chunk of change.

Fingers crossed; best luck to everyone.
« Last Edit: August 31, 2020, 06:10:27 PM by sdnerd »

JD

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1338 on: August 31, 2020, 11:11:42 PM »
Franchise Growth's 30 days is up.  I haven't seen any distributions from the previous deposits but let's hope we get some direction and action now and moving forward.

I know RS reads this board, so using this as a reminder of their due date.

IRM emails on FG just went out.  Foreclosure to proceed with each property auctioned individually. Buckle your seatbelts.  After IRM takes their pound of flesh doubt much will be returned to investors.
Appears near full loses will occur across my RS investments.  I wish I had never found Sam's blog on crowdfunding and how he touted RS.

Agree. I invested over 100k bcs of Sam posts

x3. And I'm in for 525k  :'(

babets

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1339 on: September 01, 2020, 04:36:40 AM »
Appears near full loses will occur across my RS investments.  I wish I had never found Sam's blog on crowdfunding and how he touted RS.

I'm at least (somewhat) hopeful there will be some decent return of capital. And now that we are finally not all lumped in together and each property being treated separately the specifics of each will matter a lot more.

Just reviewing the final 3 deals I'm stuck with:

1. Detroit MSA Dog Haus in Taylor MI. The building was demolished, and roughly 50% of the funds were returned to investors. Another $50K was held back to pay for legal/foreclosure costs. The land was originally valued at nearly $1M almost 4 years ago. They also paid some interest on this one. Worse case scenario of ~40% loss if they get nothing for the land - which isn't going to happen.

2. Louisville MSA Captain D's. Google maps shows the building as fully completed and I "think" this location might have been operational for a bit so the inside might be reasonably put together still. This could be a quick turnaround for a franchiser that can run with the building mostly as is.

3. Coastal Florida Church's Chicken. Same as above; Google maps shows the building as fully completed.

I'm still expecting a decent hit, but I'm hopeful that given the state of at least those 3 deals there's some opportunities for a significant portion of the capital to be returned.

We also have the $195,000 non-refundable deposit from the FG folks. That should at least help offset some of the legal fees. And if nothing else, provide some solace that the FG folks are going to be losing a fair chunk of change.

Fingers crossed; best luck to everyone.


My 3 are:

1 urgent care ISLIP: this investment has paid a bit of interest at beginning (10%) and then nothing. The urgent care facility is operating, i guess it will foreclose for a decent return considering its up and running. Strange that it has to foreclose since it is open (?) however i would expect a loss of 50% here.

2 urgent care LARGO: this returned already 50% of invested capital between interests and reimbursement. I am hoping to recover another 20%...nothing was ever built here

3 taco in MICHIGAN : exact same as 2