Author Topic: Thoughts On RealtyShares Closing Its Doors To New Investors  (Read 475867 times)

mspringer

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1340 on: September 01, 2020, 06:42:35 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.

I am down to just Church's Chicken in Apalako (Orlando), FL.  The restaurant opened last Spring but I am not sure what the current status is?  I would assume it is nearly turnkey ready, if it's not actually still open.  I looked at GOALZ website, who were the original company that was going to run it and they do not show it as on their map.  So either they never took it over or it is currently closed.

rs_thoughts

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1341 on: September 01, 2020, 06:37:45 PM »
Two years for this result is just terrible. To think, I did RS for diversification purposes and safety (Senior loans) when I could have just stuck it in Tesla or other stock. Sigh.  Opportunity COST is huge. Wishing everybody good luck And health.

Now, if someone could refer me to the best class action lawsuit filing, that would be much appreciated. Adding my name. Thanks

DECA

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1342 on: September 02, 2020, 10:21:08 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.

I am down to just Church's Chicken in Apalako (Orlando), FL.  The restaurant opened last Spring but I am not sure what the current status is?  I would assume it is nearly turnkey ready, if it's not actually still open.  I looked at GOALZ website, who were the original company that was going to run it and they do not show it as on their map.  So either they never took it over or it is currently closed.

Louisville Captain D's appears from their website to up and running.  Long Island AFC has been operating for quite some time and, I believe, paying full rent to FG since May 2019.  Seems like IRM hasn't really pushed FG to make payments as required for properties that appear to have been performing.  So it seems that cashflow from some properties was pocketed by FG and used to complete other properties. IRM should not have allowed that.  Even more importantly, RS should've disclosed the key role of Bruce Arinaga in FG.  I certainly would not have invested in any FG deals had I known about his involvement since a simple Google search of him would've revealed his prior bankruptcies.

sdnerd

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1343 on: September 03, 2020, 08:42:48 AM »
Louisville Captain D's appears from their website to up and running.  Long Island AFC has been operating for quite some time and, I believe, paying full rent to FG since May 2019.  Seems like IRM hasn't really pushed FG to make payments as required for properties that appear to have been performing.  So it seems that cashflow from some properties was pocketed by FG and used to complete other properties. IRM should not have allowed that.  Even more importantly, RS should've disclosed the key role of Bruce Arinaga in FG.  I certainly would not have invested in any FG deals had I known about his involvement since a simple Google search of him would've revealed his prior bankruptcies.

Different Louisvile Captain D's. The one on their website is 1292 Shelbyville Rd. The FS one is 1709 Midland Trail, Shelbyville. If you pull it up on street view in Google Maps it appears built out. And it's listed as Coming Soon on Goalz's site:

https://www.goalzllc.com/all_map_locations/all-captain-s-location-1/

I actually read one of the class action complaints this morning; had some additional details I wasn't aware of. Frightening.

http://securities.stanford.edu/filings-documents/1072/RI1700_17/2020117_f01c_20CV10107.pdf

Appears several law firms announced class actions, but I'm not sure if any are moving forward/etc. If anyone has any additional information that would be appreciated; I would like to join in.



DECA

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1344 on: September 11, 2020, 06:37:15 PM »
Louisville Captain D's appears from their website to up and running.  Long Island AFC has been operating for quite some time and, I believe, paying full rent to FG since May 2019.  Seems like IRM hasn't really pushed FG to make payments as required for properties that appear to have been performing.  So it seems that cashflow from some properties was pocketed by FG and used to complete other properties. IRM should not have allowed that.  Even more importantly, RS should've disclosed the key role of Bruce Arinaga in FG.  I certainly would not have invested in any FG deals had I known about his involvement since a simple Google search of him would've revealed his prior bankruptcies.

Different Louisvile Captain D's. The one on their website is 1292 Shelbyville Rd. The FS one is 1709 Midland Trail, Shelbyville. If you pull it up on street view in Google Maps it appears built out. And it's listed as Coming Soon on Goalz's site:

https://www.goalzllc.com/all_map_locations/all-captain-s-location-1/

I actually read one of the class action complaints this morning; had some additional details I wasn't aware of. Frightening.

http://securities.stanford.edu/filings-documents/1072/RI1700_17/2020117_f01c_20CV10107.pdf

Appears several law firms announced class actions, but I'm not sure if any are moving forward/etc. If anyone has any additional information that would be appreciated; I would like to join in.

I think the law firm that was certified to represent the class is:

Shapiro Haber & Urmy LLP
2 Seaport Lane
Boston, MA 02210
Telephone: (617) 439-3939
Facsimile: (617) 439-0134

I believe that Ian McLaughlin is the attorney there who is actively handling the case.
imcloughlin@shulaw.com

supportingmaps

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1345 on: September 17, 2020, 09:33:06 AM »
Good luck you all. I am on a REIT and I'm glad I haven't lost my money. In any investing consideration I spread my money around so I don't suffer huge losses.
I help market for small businesses FREE of charge:
www.supportingmaps.com

berkel

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1346 on: September 17, 2020, 03:22:01 PM »
My only FG deal is the AFC in Largo, FL.  I hope you're right and we get another 20%.  I'll chalk it upto a life lesson.

I just got ominous news on my other openRealtyShares deal:

Castle Court Apartments Seattle 2nd Lien Tranche 2

The lender is having difficulty getting financing.  Shocking I know.  Don't know why I thought a 2nd Lien was a good idea, but hope I can get all of the principal or at least a decent chunk.

GLTA and stay safe!


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

barnold24

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1347 on: September 18, 2020, 09:33:31 AM »
Lucky me, first time in 14 years the Sponsor ever had a bad investment and I got to be in it.


Dear Investors,

I regret to inform you on July 17th, 2020, 2001 Anderson Ferry Rd was transferred back to the bank via a Deed in Lieu of Foreclosure (“DIL”, aka “friendly foreclosure”) process. This has resulted in a total loss of all invested capital remaining for all investors. We exhausted all options to save this property for you, and this step was only taken as a last resort after the failure to raise additional capital to meet the needs of Tri-health’s lease renewal, the negotiations for a loan modification, or short sale with the lender failed. I understand how disappointed you all are.
While we cannot look at this investment as anything other than a disappointment, I hope you can find some comfort in the fact that we returned 52% of your initial investment through monthly distributions until the end of 2019. The other benefits of the Deed in Lieu of Foreclosure process is that it allowed us to avoid time-consuming and costly foreclosure proceedings and, in the end, absolved us of over $3.8M of debt.

Just for context, this investment is the first in Mascia Development LLC’s 14-year history that investors lost their capital. I also wished to clarify that all members of the sponsor and the manager lost 100% of their money, the same as you, there was no special treatment for anyone. I understand that I have lost your trust through this outcome. The specific outcome of this property is a large part of why I decided to shut Mascia Development LLC down last month.

Also, my e-mail from a couple of weeks ago to all investors, past and present, may have created some confusion which I wanted to clear up. I am still the manager of Anderson Ferry Rd 2001 LLC via AFR 2001 Manager LLC and Mascia Development LLC. In addition, I personally guaranteed the loan on this property.

To further clarify, Ed Peete did not purchase Mascia Development LLC. He purchased an interest in various partnerships from Mascia Development LLC and other entities that have allowed him to take control of the future direction of those partnerships.

There was a Global Settlement and Release Agreement between Ed Peete, me, and several other members of the manager limited liability companies. Nothing in the Global Agreement or the partnership purchases were related to Anderson Ferry Rd 2001 LLC (this investment).

As my previous correspondence noted the entire Mascia Development LLC team has moved on to other jobs, and I have retired from Mascia Development LLC. I am in the process of shutting down the company completely. I wish you all well in future endeavors and thank you for your trust in us up to this point.

Allover

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1348 on: September 19, 2020, 03:22:56 PM »

Hello All,

I have been reading everyone's comments for the last 18 plus months and this board and shaking me head. How could this have happened? How could these people have been so wrong about these investments?  I have several theories, the most likely of which is that RS was run by a bunch of know nothings who thought that an MBA from Stanford meant that they actually knew how the world works. A classic example of confusing education with knowledge.  Add to that the real estate / hard money business is filled to the brim with shady people. What does that give you? The recipe for disaster which comes with mixing naive children and hardened skells. 

Be that as it may, here we are. And like the man said in the movie :  DON'T GET MAD. GET EVEN.

I have several "sinking boats" but the one that has prompted me to post is 26088 Duval Way, Los Altos Hills, CA 94022

It seems that a very shady outfit got money from RS ( Including some of mine) and has managed to turn a spec house in the hottest real estate market in the US into a losing proposition.

What I need from you fellow contributors to this blog is the following :

A good pit bull attorney in that part of the US who can chase these guys down. I am taking writs of replvin on their cars, wage garnishment, etc. etc. I dont care if I get $26.88 a month for the next 40 years. I want my money.

Please post name address / phone / email of a good attorney.  We need to strike now while the iron is hot. RS will ( like they did elsewhere) let themselves be fast talked by these thieves.

After all , its NOT their money.

Thanks!

cgblack

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1349 on: September 22, 2020, 08:40:21 AM »
For those of you in the 1 Sand and Sea investment, there appears to be some good news.  The property in MLS listed and shows as pending @ $9,249,000.  Hopefully a return of our principal and outstanding interest is in the near future.
https://www.realtor.com/realestateandhomes-detail/1-Sand_Carmel_CA_93921_M95753-42657

sparkkim

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1350 on: October 17, 2020, 02:46:57 PM »
Hi, Please let me know if you have any insights on 405 Alberto Way, Los Gatos and Castle Court in Seattle. Thanks!

groovydude

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1351 on: October 21, 2020, 09:54:52 AM »

Hello All,

I have been reading everyone's comments for the last 18 plus months and this board and shaking me head. How could this have happened? How could these people have been so wrong about these investments?  I have several theories, the most likely of which is that RS was run by a bunch of know nothings who thought that an MBA from Stanford meant that they actually knew how the world works. A classic example of confusing education with knowledge.  Add to that the real estate / hard money business is filled to the brim with shady people. What does that give you? The recipe for disaster which comes with mixing naive children and hardened skells. 

Be that as it may, here we are. And like the man said in the movie :  DON'T GET MAD. GET EVEN.

I have several "sinking boats" but the one that has prompted me to post is 26088 Duval Way, Los Altos Hills, CA 94022

It seems that a very shady outfit got money from RS ( Including some of mine) and has managed to turn a spec house in the hottest real estate market in the US into a losing proposition.

What I need from you fellow contributors to this blog is the following :

A good pit bull attorney in that part of the US who can chase these guys down. I am taking writs of replvin on their cars, wage garnishment, etc. etc. I dont care if I get $26.88 a month for the next 40 years. I want my money.

Please post name address / phone / email of a good attorney.  We need to strike now while the iron is hot. RS will ( like they did elsewhere) let themselves be fast talked by these thieves.

After all , its NOT their money.

Thanks!

Allover,

I hear you and feel your pain. One of my remaining investments was a PE deal on a rehab/redevelopment of a SFR in the Seattle area. The sponsor has/had dozens of SFR and small MF projects in the area. Now I am being told the sponsor is on the verge of Ch. 11. Have you followed Seattle residential RE over the last 10 years? A company with this business model that's going bankrupt in this area is either run by crooks or idiots. RS did ZERO research on the sponsors it brought to the platform. IMO it's a miracle that they've seen as much success as they have.

BTW, RS was not alone. Crowdstreet just recently offered a deal by the same sponsor. I mean within the last few months. All it would have taken is 5 minutes on the internet to find the dirt on this company. I used to think CS was much more diligent than RS. I'm not sure if ANY of the crowdfunding platforms really does any serious vetting.

As for your pit bull lawyer. PLEASE find one. We need to go after Nav and the VC investors. I'm right there with you if you can find someone, but it will have to be on a contingency basis. IF anything is ever taken from these crooks we'll see pennies on the dollar. Just my $.02.

Groovy

Allover

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Re: Thoughts On RealtyShares Closing Its Doors To New Investors
« Reply #1352 on: Today at 06:54:05 AM »
Hello,

An update since my last post.

I found an attorney who is currently suing the developer of the Duval Way project. He is suing him for something else. That by itself speaks volumes to the lack of due diligence shown by RS. Stated another way, they blindly invested our money with crooks.

The first lawyer sent me to another lawyer.  The second attorney told me that : 1) He was not really interested in contingency.
 2) That I needed to think long and hard about spending $5,000 to sue over a $10,000 loss. Further because I would so far down the food chain, behind mechanics liens etc, that I would get pennies. If that.

As such I am in a holding pattern.

 If anyone has any additional comments or thoughts please share.

Thanks!!