NEW YORK--(BUSINESS WIRE)--ArborCrowd (the “Company”), the first crowdfunding platform launched by a real estate institution, announced today that its Quarry Station Apartments investment (“Quarry Station”) has been realized in under two years, providing investors with returns quicker and higher than initial projections. The property’s $49.35 million sale price generated an internal rate of return (IRR) of 20.31%, surpassing the original return target of 16% to 19%.
The sale of Quarry Station, which is located in downtown San Antonio, represents the second ArborCrowd deal to be realized ahead of schedule and above the projected return target. The first realized investment occurred in July 2018 with the sale of the Southern States Multifamily Portfolio (“SSMP”), which generated an IRR of over 29% for ArborCrowd investors. Like the SSMP investment, the Quarry Station offering was well received by investors, raising $1 million of ArborCrowd’s total $3.2 million equity commitment in the first day. The outcomes of both transactions reflect the quality of ArborCrowd’s rigorous underwriting standards.
“Since inception, our focus has always been on bringing quality deals to the crowd,” said ArborCrowd Co-Founder and COO Adam Kaufman. “This is a responsibility we take incredibly seriously, and it’s why we employ such a deliberate vetting and underwriting process. We prioritize strong real estate fundamentals over volume of deals, which is an exception to the norm in real estate crowdfunding. This ‘real estate first’ approach differentiates us, and the solid returns we’ve delivered to our investors validate our business model.”
Quarry Station’s value was enhanced through a comprehensive capital improvement program and implementation of institutional property management. Changes included a rebranding of the asset and interior and exterior renovations. These actions created a highly desirable asset that capitalized on the property’s location in the popular Alamo Heights neighborhood.
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ArborCrowd is the first real estate crowdfunding platform launched by a real estate institution, opening up an exclusive network to a new class of investors. As part of The Arbor Family of Companies, which includes Arbor Realty Trust (NYSE: ABR), a leading publicly traded commercial mortgage real estate investment trust, ArborCrowd is backed by more than 30 years of leadership experience. ArborCrowd reviews more than 500 deals a year from its proprietary network and only chooses the ones that survive its rigorous underwriting process. ArborCrowd prefunds capital to a deal prior to launching the offering to investors. This ensures the deal closes and allows ArborCrowd to offer investors accurate and detailed information about the property. Additionally, ArborCrowd chooses to present one deal at a time, so there is no guessing what property investors will actually own.