Status: Repaid

Annual Return Term Remaining
11% -
Loan to ARV
38.9%
Investment Offering
$1,750,000
Min. Investment
$5,000
Term
6 mo.
Underlying Asset
Multi-Family (5+ Units)
Guarantee
Personal Guarantee
Underlying Security
1st Position

This offering is fully funded

Boston, MA Bridge Loan

REPEAT BORROWER

Updates

  • 02/26/21

    Fund That Flip is pleased to inform you that the loan has been paid off. The payoff date is 02/23/2021.

    You will receive the following payments related to this payoff: February 2021 Partial Normal Interest, February 2021 Partial Penalty Interest, and Principal.

    You can expect to see these funds deposited in your bank account within 5-8 business days. In addition, these payments will be view-able from your investor dashboard.

  • 02/12/21

    Fund That Flip has been in communication with the developer about the current status of the project.

    We are discussing multiple different exit paths with the borrower in order to determine the best path forward. We expect to have more information by the end of the month.

    Investors will continue to be updated as further developments occur.

  • 11/24/20

    Fund That Flip has been in communication with the developer about the current status of the project.

    The developer has represented that they are still working on obtaining the necessary permits and part of the delay is due to the lengthy design portion. Once the permits have been acquired, the developer plans on either selling this to another investor or refinancing the loan.

    Investors will continue to be updated as further developments occur.

  • 09/17/20

    Fund That Flip has been in communication with the developer about the current status of the project.

    The developer has represented that they are currently working with another investor to potentially sell the property. They expect to have a more firm plan in the coming weeks.

    Investors will continue to be updated as further developments occur.

Investment Summary


Type No Rehab/No Construction
Underlying Asset Multi-Family (5+ Units)
Underlying Security 1st Position
Guarantee Personal Guarantee

Fund That Flip closed the loan on this property on July 31, 2020. Your investment will begin accruing interest on the day it clears escrow.

Fund That Flip has provided a first distribution of $1,569,368 to the developer at closing for a loan to purchase of 49.0%. Fund That Flip is holding back $114,382 for 6 months of pre-paid interest.

There is no construction to be done over the course of Fund That Flip's loan although the anticipated construction budget is approximately $9,200,00. Fund That Flip will not be financing any of that construction. The developer plans to refinance out of Fund That Flip's loan with another lender who will finance the construction or sell the property to another developer who will execute the build.

Over the course of the project, the developer will contribute an estimated $1,811,265 in equity, including an estimated $1,630,632 at the time of closing. The total loan-to-as-is is 38.9%. There is a 3 month pre-payment penalty, meaning investors will earn interest through October 31, 2020, even if paid back earlier. The term of the underlying loan is 6 months with an option to extend. Should Fund That Flip choose to grant the extension(s), half of the extension fee(s) collected will be distributed to investors upon receipt.

Use of Proceeds


  Cost Use of Proceeds % of Loan
At close $3,200,000 $1,569,368 89.7%
Purch. $3,200,000 $1,569,368 89.7%
Construction Draw at Close $0 $0 0.0%
Remaining Construction/Rehab $1 $0 0.0%
Prepaid Int $114,382 $114,382 6.5%
Closing $66,250 $66,250 3.8%
Total $3,380,633 $1,750,000 100.0%

Loan to Cost


  Cost Amount Disbursed Borrower Contribution Loan to Cost
At close $3,200,000 $1,569,368 $1,630,632 49.0%
Purch. $3,200,000 $1,569,368 $1,630,632 49.0%
Construction Draw at Close $0 $0 $0
Remaining Construction/Rehab $1 $0 $1 0.0%
Prepaid Int $114,382 $0 $114,382 0.0%
Closing $66,250 $66,250 $66,250 100.0%
Total $3,380,633 $1,635,618 $1,811,265 48.4%

Valuation


Valuation Method Estimated Value Amount Distributed LTV
Purchase Price $3,200,000 $1,569,368 49.0%
FTF Valuation: $4,500,000 $1,750,000 38.9%

Fund That Flip’s Internal Underwriters use industry standard valuation software, independent real estate data, and internal proprietary modeling to estimate the expected After Repair Value of the property.

Fund That Flip develops an internal valuation on all projects using an automated valuation model (AVM), which estimates real estate property valuations using mathematical modeling, combined with a database of real estate information for comparable properties. The comparable properties in the analysis are have a similar number of bedrooms, bathrooms, and square footage, and are of similar home style.

The internal valuation of $4,500,000 on the property is supported by the following data points:
• 5 comparable properties have recently sold between $1,500,000 and $8,400,000.
    • The comparable properties used within the analysis are within 0.45 miles of the subject property.
    • 2 of these properties had approved development plans prior to the most recent sale.
    • 3 of these properties did not have approved development plans prior to the most recent sale.
    • Additionally one (1) of these properties sold in 2015, one (1) sold in 2016, one (1) sold in 2017, one (1) sold in 2018, and one (1) sold in 2020.
• Price per buildable square foot of these comparable properties ranges from $30 to $109.
    • Our internal valuation yielded a price per buildable square foot of $104.
• Price per lot square foot of these comparable properties ranges from $98 to $386.
    • Our internal valuation yielded a price per lot square foot of $336.
• Price per buildable residential unit of these comparable properties ranges from $33,000 to $111,000.
    • Our internal valuation yielded a price per buildable residential unit of $141,000.

Additionally, we developed an internal valuation of the completed residential units assuming the construction is completed. Each unit will be 2 beds, 2 full baths, and have an average of 900 square feet. Our internal valuation of $700,000 per unit is supported by the following data points.
• 6 comparable properties have recently sold between $680,000 and $880,000.
    • The comparable properties used within the analysis are within 0.75 miles of the subject property.
• Price per square foot of these comparable properties ranges from $659 to $836.
• Our internal valuation yielded a price per square foot of $778.
• Gross monthly rents are estimated at $107,925 for similar properties in the area.

Fund That Flip used the FTF internal valuation when making the final decision to fund this project.

About the Property


Details

Bedrooms 64
Full Bathrooms 64
Year Built 2020
Square Footage 41452 SF
Garage Spaces 27
Purchase Price $3,200,000
Estimated Rehab Budget $1
ARV $4,500,000
Developer Equity $1,811,265 plus closing & holding costs

Market Overview


• Boston is a city in Suffolk County, MA

The subject property is:
    • 6 miles to Downtown Boston
    • 1 mile to Harvard Business School
    • 3 miles to Fenway Park

• Retail Sales Sold: 98%
• Short Sales Sold: 0%
• REO Sold: 2%

  • data acquired from internal sources.

Project Strategy


The developer bought this property with financing from Fund That Flip on July 31, 2020. Your investment will begin accruing interest the day it clears escrow.

Prior to closing, the developer received approval from the city to build a 33 unit mixed-use development on the property. Over the course of Fund That Flip's loan, they will prepare for construction by finalizing construction estimates and plans, obtaining the building permit, and securing a construction loan from another lender.

Fund That Flip will not be financing the construction on this project although the developer is initially estimating the build cost will be about $9,200,000. The current plans include 32 two-bed, two-bath condos ranging from 830 square feet to 937 square feet with a 1,500 square foot first floor commercial space.

If the developer does not decide to execute the build and refinance out of Fund That Flip's loan with a construction loan, they will sell the property to another developer who will complete the project.

Risk


Having a thorough understanding of the risks of each investment in your portfolio is important prior to making an investment. Fund That Flip encourages you to do full due diligence on each deal and consult your investment, tax and legal advisors prior to investing.

Risk:
The market value of the property drops significantly removing opportunity for the developer to make a profit.

Mitigating Factor:
The property is located in a stable market and was purchased at a discount providing downside protection in a falling-price environment.

Risk:
The developer chooses not to complete the project.

Mitigating Factors:
• The developer has considerable equity in the project and the LTV on an ARV basis is 38.9%.
• Fund That Flip holds a first position lien on the property and the partner has personally guaranteed the loan.

Risk:
The developer is unable to complete the project in the allotted 6 month period.

Mitigating Factor:
Fund That Flip has built in a 3 month optional extension, approved only if project is advancing at a satisfactory pace. Extension corresponds with an additional fee to be shared on a pro-rata basis with investors.

A more complete list of risks for this investment is provided in the Investor Offering Materials and should be read and reviewed with your investment, tax and legal advisors.