Real Estate•Invictus Real Estate Partners

Williamsburg Multi-Family Restructuring Equity

Annualized return3

Term3

10 months

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Status

Fully repaid

Recently funded

Accepting $50,000 - $500,000 investments

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Accepting $50,000 - $500,000 investments

Overview

Important Notes

This offering is not available to pension plans, defined benefit plans, defined contribution plans, retirement plans, IRAs, 401(k) and 403(b) funds, and funds comprised of these plans and funds.

Highlights

Attractive cost basis

Quality asset

Desirable location

Grounds for foreclosure

Experienced team

CBRE, a commercial real estate services company, appraised the property as of October 2019. CBRE valued the property on an “as-is” basis at $109.6M, or $1.1M per unit, and “as stabilized” at $119.7M, or $1.2M per unit. The sponsor additionally valued the property on an “as-stabilized” basis at $119.0M, consistent with the appraisal. Yieldstreet’s investment basis is $94.4M, or $983k per unit, equating to 79.3% of the property’s estimated value.
The mortgage loan is secured by a 96-unit multi-family building with 31K SF of multi-level retail space in Williamsburg, Brooklyn, NY. The property enjoys frontage and strong visibility in a prime location, and the units (consisting of studios to three bedroom apartments) each feature large windows, hardwood floors, stainless steel appliances, quartz countertops and individually controlled heating and cooling. Beyond the high quality interiors of each unit, the building also offers residents amenities including a rooftop deck, rear patio, spa, co-working space, fitness center, laundry room, bike room, state of the art gym, 170 space parking garage and seventh-floor recreation room.
According to CoStar, a leading commercial real estate analytics company, the Williamsburg submarket has transformed from an industrial working-class neighborhood to one of New York’s most prominent neighborhoods. The submarket's strong demand drivers include abundant retail amenities, manageable rents compared with Manhattan, proximity to nearby job centers, and have supported strong demand from young professionals.
Based on the loan agreements, the borrower has defaulted on three terms: failure to meet the temporary certificate of occupancy deadline; not paying back the loan upon maturity; and misappropriation of funds. These events of default warrant the sponsor to pursue all remedies under its rights as a first mortgage and mezzanine lender, and additionally maintains the right to pursue bad act guaranty claims against the guarantors. While the loan is non performing, the multiple avenues available to the sponsor to seek recourse increase the expectation of a resolution within 36 months.
The sponsor, Invictus, is a New York based, vertically integrated real estate PE firm founded in March 2020 by Eric Scheffler and Christopher Pardo. As of 5/31/21, Invictus has closed 8 transactions with total equity investment of $125M. Prior to Invictus, Eric was a director at the CMBS group of Bear Stearns, GC and MD at Madison Realty Capital where he worked on loan workouts, including foreclosures, on over 150 deals. Most recently, Eric was the principal and GC at Glacier Global Partners, a real estate PE firm.
In addition to the experience of Invictus and its founders, the sponsor has also retained two reputable international and national law firms as counsel for the foreclosure proceedings.

Essentials

Please refer to the Investment Memorandum in the Documents section for more details about this offering.

Capital structure

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Cash flow

How do I get paid?

Assets

What is the collateral underlying the transaction?

Returns & Management fees

Ann'l management fee

2.5%

Target ann'l net return

15% - 17%

Share in excess profits

100%

Target equity multiple

1.6x - 1.7x

Schedule

Payment schedule

Event based

Prefunded

Yes

Target term

36 months

Structure

Tax document

K-1

Offering structure

SPV

Expenses

First year expense

$150

Annual Flat Expense

$70

Docs

Content

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"Annual interest," "Annualized Return" or "Target Returns" represents a projected annual target rate of interest or annualized target return, and not returns or interest actually obtained by fund investors. Unless otherwise specified on the fund's offering page, target interest or returns are based on an analysis performed by Yieldstreet of the potential inflows and outflows related to the transactions in which the strategy or fund has engaged and/or is anticipated to engage in over the estimated term of the fund. There is no guarantee that targeted interest or returns will be realized or achieved or that an investment will be successful. Actual performance may deviate from these expectations materially, including due to market or economic factors, portfolio management decisions, modelling error, or other reasons.

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