Three Properties Self Storage Commercial Hard Money Loan
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This investment opportunity highlights a self-storage facility project in three cities. The commercially zoned vacant land in each city is located in an area with high visibility and excellent frontage.
Three Properties Self Storage Commercial Hard Money Loan Details
Structure
- Tax Document
- 1099-INT
- Offering Structure
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BPDNx
SENIOR BPDN - PROMISSORY NOTE SECURED BY COLLATERAL SECURITY AGREEMENTTHIS PROMISSORY NOTE IS SECURED BY THE ISSUER'S PLEDGE OF THE RELEVANT UNDERLYING COLLATERAL LOAN (AS DEFINED BELOW) TO THE LENDER (AS DEFINED BELOW) UNDER THE COLLATERAL SECURITY AGREEMENT AND PROMISSORY NOTE. HOWEVER, EXCEPT TO THE LIMITED EXTENT PROVIDED IN THE PROMISSORY NOTE WITH RESPECT TO THE UNDERLYING COLLATERAL LOAN, THIS NOTE IS NON-RECOURSE TO THE ASSETS, FUNDS AND ACCOUNTS OF YIELDI, LLC (THE "BORROWER", "COMPANY" OR "ISSUER") OR ANY OF ITS AFFILIATES, EMPLOYEES, AGENTS, STOCKHOLDERS, PARENTS, OR SUBSIDIARIES EXCEPT TO THE EXTENT OF THE VALUE OF COLLATERAL LOAN NET PAYMENTS ACTUALLY RECEIVED IN RESPECT OF THE UNDERLYING BORROWER LOAN.
Example Return on Investment
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Investment Amount:
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Annual ROI:
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$0
Why We Like This Opportunity
New Haven, CT Property Highlights
Approximately 0.74 acres of vacant land zoned commercial and the future site of a climate controlled, self-storage facility. The facility consists of 64,033 GSF / 45,020 RSF and will house 472 storage units ranging in size from 5×5 to 10×25. Construction drawings are currently undergoing final edits and will be completed within the month for submission for the building permit. This site is located on a retail corridor of Amity Drive, in the loop of the on-ramp to Wilbur Cross Parkway with very high visibility. New Haven is a coastal city located on New Haven Harbor on the north shore of Long Island Sound and home to the Ivy League Yale University, located 3.5 miles from the facility site.
Edgewater Park, NJ Property Highlights
Approximately 7.81 acres of commercially zoned vacant land and the future site of a climate controlled, self-storage facility. The site is fully entitled for the project, and the building permit is days from approval. The facility is 112,753 GSF / 88,825 RSF and will house 943 storage units. This is a high-traffic, high-visibility area with excellent frontage and signage opportunity. Edgewater Park Township is a suburb of Philadelphia and in Burlington County. Living in Edgewater Park Township offers residents a dense suburban feel and most residents own their homes.
Jacksonville, FL Property Higlights
Approximately 2.78 acres of commercially zoned vacant land and the future site of a climate controlled, self-storage facility. The site is fully entitled for the project containing 127,840 GSF / 99,795 RSF and housing 990 storage units. Schematic construction drawings are in place and moving forward to full construction drawings. Submission for the building permit will take place once the full construction drawings are complete. The site is located on a major north-south retail and commuter corridor (Main St.) just North of Downtown Jacksonville. The city is located on the Atlantic coast of northeast Florida in Duval County. It offers many advantages to businesses including high survival rates, a great environment for startups, low taxes and cost of living, a growing workforce, and high quality of life.
Seniority
The first-priority mortgage lien position is the most senior and highest priority within the capital structure. In the event that a borrower defaults, the lien priority determines the order in which lenders are repaid. Senior lenders are always repaid first. All subordinated positions, including the amount held by the Originator and its investor syndicate, act as a buffer in the event of a deterioration in the Properties’ value.
Personal Guarantee
The Loans are personally guaranteed by the borrower, spouse, and all principals in the LLC. Additionally, the Sponsor and/or Guarantor are obligated to contribute monthly payments to maintain a tax and insurance reserve. Failure to adhere to reserve contribution requirements would lead to the triggering of a debt service and operating expense/shortfall guarantee.What Should I Consider When Investing in Three Properties Self Storage Commercial Hard Money Loan?
Borrower Risk
The Borrower may not have represented itself accurately. Risk Mitigation- The Originator checks the Borrower's credit history via a third-party credit reporting company. The Borrower has a 700 credit score.
- The Originator considers the underlying asset to be the primary source of security.
- If the Loans are not fully repaid after the Lender has exhausted other sources of repayment, the Borrower has provided a personal guaranty to fulfill any deficiency.
Default Risk
The Borrower may default on his financial obligations. Risk Mitigation- If the Loans are not fully repaid after the Lender has exhausted other sources of repayment, the Sponsor has provided a personal guaranty to fulfill any deficiency.
- In the event of a default, a direction letter signed at closing by the Borrower will be sent redirecting the Tenant to make rent payments into an account controlled by the Originator.
Vacancy Risk
The Tenant may vacate the leased properties. Risk Mitigation- The Tenant is an investment grade rated company with sizable financial resources.
- Under the triple-net leases, the Tenant is under multi-year contract to pay rent with no option to terminate.
- If the Tenant decides not to renew any of the leases or to vacate the leased premises, the Borrower will pay for an appraisal of the property “as vacant” and the borrower will have to provide the additional cash collateral and/or pay down the loan (or any combination in between) within ten days of receipt of the appraisal in order to bring the property back to an LTV.
Investment Summary Of Three Properties Self Storage Commercial Hard Money Loan
Investors have an opportunity to invest in borrower payment dependent notes, the cash flow of which is dependent on the payment of interest and principal repayment on the Loans. Investors are scheduled to receive an annualized monthly interest payment of Login for details over the Loans' estimated remaining term of 12 Months. Principal is expected to be returned on or before maturity through a refinancing with a traditional bank loan. It is important to note that the Loans are eligible for prepayment, and principal may be repaid prior to the 12 Months estimated remaining term. If the Loans are paid off before maturity, investors are expected to receive at least three months of interest payments in addition to return of principal.
How Do I Get Paid?
This loan had an initial term of 12 Months with an option at Yieldi's discretion to extend. As of January 17, 2023 there are 12 Months remaining. Investors will immediately receive monthly interest payments at an annualized rate of Login for details on the principal balance over the life of the loan. If you invest in this loan in the middle of a month, you will receive a prorated interest payment for your investment for your first investment month and then full monthly payments thereafter. All payments are made automatically via ACH on the 1st of each month and investors all paid by the 10th of the month.
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