OPPORTUNITIES FOR HIGHER RETURN
Our team of investors has completed over $1.5 billion in residential real estate acquisition and renovation projects in the Washington DC region.
Million Equity Investment - Summit Fund, LLC
%
Preferred Return Collateralized Investment
PURPOSE OF INVESTMENT
Carstensz Capital provides high interest “hard-money loans” to residential developers performing single-family renovations and condominium conversions in the Washington DC, Virginia, Maryland, Tennessee and Florida. Capital is deployed through investment funds structured for the purpose of making these loans. Investment funds retain the security interest in underlying assets and investors own a pro-rata portion of the fund’s equity and receive a preferred return. Funds, underwriting, servicing, and loss mitigation efforts (if applicable), are managed by Carstensz Capital Partners, LLC.
MANAGEMENT FEES CHARGED TO THE FUND BY CARSTENSZ
Loan Servicing Fees
16.7% of interest charged to developer
Initial Points
100% of initial points (majority of underwriting expenses paid by management company)
Extension Points
Split with fund 50/50
Default Servicing Fees
16.7% of default interest and fees charged to developer
Ownership in Fund
None. Partners in management company may invest alongside fund investors at same terms.
UNDERWRITING REQUIREMENTS AND RISK MITIGATION
Primary Underwriting Metric
70% Loan to After Repair Value (LARV)
%
LARV
Secondary Underwriting Considerations
1. Developer experience—Minimum of 3 successful projects within last 36 months
2. Personal Financial Statements & Tax Returns – Determining cash available for living expenses and construction costs before 1st draw
3. Personal Guarantee regardless of financial position
4. Cross Collateralization of other projects if possible
5. Prohibitions: personal occupancy, leasing, or obtaining 2nd liens (investment only)
6. Verification of insurance and certificate of insurance
7. Field inspections required for loan draws
TYPICAL DEVELOPER LOAN TERMS SECTION
Typical Developer Loan Terms
Interest Rate: 9.99% – 12.99%
Initial Points: 2 – 5%
Extension Points: 2
Financing Available: 85% – 100%
Default Interest After Extension: 2x
Term: 6, 12, and 24 month products available
Investment Terms
Pro-rata membership interest
• Annualized 13% preferred return (paid monthly)
• $100k minimum investment
• Fund Exit: Evergreen fund so investor required to give six month notice which then starts return of capital through distribution of pro rata share of future loan payoffs until capital fully returned
• Projected IRR 13% – 15%
• Fund utilizes 55% to 65% leverage from institutional credit facility to enhance investor return and lower overall cost of funds
INVESTOR INQUIRIES
For more information on how to invest with Carstensz Capital fill out the form below and one of our investors will be in touch with you soon.