Real Estate•Yieldstreet

Multi-Family Development Preferred Equity

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Status

Closed

Recently funded

Accepting $30,000 - $250,000 investments

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Accepting $30,000 - $250,000 investments

Overview

Invest in a $7.1M preferred equity investment for the development of a 368-unit garden-style multi-family complex and five retail pads in Riverview, Florida. Riverview is a suburb within the Tampa Bay metropolitan area and the South East Tampa Submarket. Riverview is approximately 15 miles southeast of Downtown Tampa and is part of a recent wave of development surrounding the city.

The project is being led by the same experienced Florida-based developer responsible for Florida Multi-Family Development Preferred Equity, Florida Multi-Family Development Preferred Equity III and North Florida Pre-Development Refinancing, which were previously offered to investors on Yieldstreet. All of these offerings continue to perform in line with expectations.

All permits for the development are in place and site preparation has begun. One of the retail parcels is under a purchase and sale agreement with a gross sale price of $2.0M. The purchaser is currently in the due diligence period, and closing is expected in 1Q21. If the sale closes, the net proceeds would be used to pay down the senior construction loan, or be held in an account for use to pay down the senior loan if the senior loan has not been drawn.

The offering has a remaining initial maturity of 24months with the option for one 12-month extension. The offering is expected to pay investors a 9.75% target annualized return that will accrue and compound monthly and will be paid along principal at maturity.

Review risk factors

View the risk factors associated with this offering from the Investment Memorandum

Important Notes

• Interest is expected to accrue and compound rather than be distributed monthly. Please refer to the “Term and Cash Flow” section for more details.

• A recent update on this offering is available here

Yield

Gross target yield

11.0%

Yieldstreet management fee

1.25%

Target yield to investors

9.75%

Interest Type

Actual 360

Schedule

Payment schedule

Deferred Return

Prefunded

Yes

Maturity

Date

Initial maturity

Sept 2, 2023

Extended maturity

Sept 2, 2024

Structure

Tax document

Offering structure

SPV

Expenses

First year expense

$150

Annual flat expense

$70

Slide 1 of 3

Yield
Gross target yield
11.0%
Yieldstreet management fee
1.25%
Target yield to investors
9.75%
Interest Type
Actual 360
Schedule
Payment schedule
Deferred Return
Prefunded
Yes
Maturity
Date
Initial maturity
Sept 2, 2023
Extended maturity
Sept 2, 2024
Structure
Tax document
K1
Offering structure
SPV
Expenses
First year expense
$150
Annual flat expense
$70

Essentials

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

Capital structure

Where does Yieldstreet lie in terms of priority?

The $7.1M Yieldstreet preferred equity investment is senior to the $14.1M in equity contributed by the developer and its investor syndicate. Yieldstreet’s position in the capital stack is subordinate to $47.5M in senior secured debt from a publicly listed investment grade rated bank.

Please see here for additional educational information on the preferred equity product type.

Term and Cash Flow

How do I get paid?

The preferred equity investment has 31 months remaining with the option for one 12-month extension. Investor returns are expected to accrue and compound monthly at an annualized target rate of 9.75% over the offering’s full term. Principal and accrued return are expected to be repaid with proceeds from the sale or refinancing of the development.

Assets

What are the assets underlying the transaction?

The development is a 33.6-acre parcel of land located in Riverview, which is a suburban location within the Tampa Bay metropolitan area and the South East Tampa Submarket. Riverview is approximately 15 miles southeast of Downtown Tampa, and is part of a recent wave of development surrounding the city. The site has frontage on major thoroughfares in the region, connecting the property to Downtown Tampa, Brandon (a regional office hub), and Tampa International Airport.

The developer expects the first unit to be completed by March 2022 and construction to be completed by July 2022, with an additional 11-month lease-up period to stabilization. The site development is approved, and site preparation has begun.

Aligned Interests

Market Dynamics

Experienced Developer

Experienced General Contractor

Completion Guaranty

Related Offerings

The developer and its investor syndicate have provided $14.1M (20.6% of total project cost) in equity, which is subordinated to Yieldstreet’s $7.1M preferred equity commitment. As a result, the developer is in the first loss position
Upon completion, the development is expected to be a 368-unit garden-style multi-family complex. According to CoStar, a commercial real estate data analytics company, multi-family demand has been solid and comparable properties have leased-up in relatively short timeframes.
The project is led by an experienced Florida-based developer of large, high-profile master-planned communities comparable to the property and over 30,000 residential units. The project is designed to be consistent in quality and aesthetic with other developments overseen by the developer and the general contractor. As such, they are able to leverage direct institutional knowledge and existing supplier relationships.
The developer has engaged a reputable general contractor that focuses on projects in the southeast United States and has completed over 100,000 multi-family units. The general contractor has provided the developer with a guaranteed maximum price, which helps mitigate the risk of cost overruns. The general contractor for this offering is the same general contractor used in the prior related offerings, and has a positive working relationship with the developer.
The developer has provided the senior lender with an unconditional guarantee of completion. As of 06/30/20, the principals of the developer reported a net worth of $31.4M, corresponding to $45.5M at fair market value. Under the terms of the senior lender loan agreement, the developing entity is obligated to maintain minimum net assets of $20M at all times while the senior loan is outstanding.
Yieldstreet has participated in four offerings with the same developer. All other related projects to this offering benefit from the experience of the same general contractor connected to this transaction. All previously offered deals continue to perform in line with expectations. See here and here for updates on how two of the other related deals are progressing. See here for an update on this specific offering.

Resources

Other resources in addition to the Investment Memorandum

This offering page describes only certain aspects of the offering ("Offering") of the securities issued by YS REL VI LLC ("Issuer"). The Offering is made only by means of the Investment Memorandum relating to the Offering (the "Offering Document"). The information on this offering page is a summary of the Offering, does not purport to be complete and should not be considered a part of the Offering Document, or as incorporated in the Offering Document by reference or as forming the basis of the Offering. No person has been authorized to give any information or to make any representations other than those contained in the Offering Document or in any marketing or sales literature issued by the Issuer or Yieldstreet Management, LLC, as adviser thereto, and referred to in the Offering Document, and, if given or made, such information or representations must not be relied upon. All investors must read the Offering Document in its entirety prior to investing in the securities.

Investing in private markets and alternatives, such as this offering, is speculative and involves a risk of loss, and those investors who cannot afford to lose their entire investment should not invest. Returns are not guaranteed.

¹ Past performance is no guarantee of future results. Any historical returns, expected returns, or probability projections may not reflect actual future performance. All securities involve risk and may result in significant losses.

² Represents an average net realized internal rate of return (IRR) with respect to all matured investments in your portfolio, utilizing the effective dates and amounts to and from the investments and net of management fees and all other expenses charged to the investments. Past performance is not a reliable indicator of future results and should not be relied upon as the basis for making an investment decision. All securities involve risk and may result in significant losses, including the loss of principal invested.[read more]

³ "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. “Term" represents the estimated term of the investment; the term of the fund is generally at the discretion of the fund’s manager, and may exceed the estimated term by a significant amount of time. 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.

⁴ Reflects the annualized distribution rate that is calculated by taking the most recent quarterly distribution approved by the Fund's Board of Directors and dividing it by prior quarter-end NAV and annualizing it. The Fund’s distribution may exceed its earnings. Therefore, a portion of the Fund’s distribution may be a return of the money you originally invested and represent a return of capital to you for tax purposes.

⁵ Represents the sum of the interest accrued in the statement period plus the interest paid in the statement period.

⁶ The internal rate of return ("IRR") represents an average net realized IRR with respect to all matured investments, excluding our Short Term Notes program, weighted by the investment size of each individual investment, made by private investment vehicles managed by YieldStreet Management, LLC from July 1, 2015 through and including July 18th, 2022, after deduction of management fees and all other expenses charged to investments.

⁷ Investors should carefully consider the investment objectives, risks, charges and expenses of the Yieldstreet Prism Fund before investing. The prospectus for the Yieldstreet Prism Fund contains this and other information about the Fund and can be obtained by emailing [email protected] or by referring to www.yieldstreetprismfund.com. The prospectus should be read carefully before investing in the Fund. Investments in the Fund are not bank deposits (and thus not insured by the FDIC or by any other federal governmental agency) and are not guaranteed by Yieldstreet or any other party.

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Multi-Family Development Preferred Equity

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