We partnered with a 30 year veteran developer to purchase 27 waterfront town homes that sat incomplete when the bank failed in 2009. We were able to purchase the property for $3M (worth over $20M).

We finished construction and sold the condos to retail buyers. Investors earned over 20% IRR.

During the Dublin Crossings residential land entitlement project, we ran into a problem. One of the tenants in the office building we planned to tear down decided not to leave, and they had a 10 year lease.

Our developer partner came up with a solution – he rezoned some of the slated residential lots back to commercial use, and we built a brand new headquarters for the tenant – Challenge Dairy. Investors earned a 20% IRR.

We contracted the purchase of an office building in the city of Dublin, California for $10M with a 1.2M option deposit. We then re-entitled the land for residential use, tore down the existing office building and finished out residential lots. We expected to sell the lots for $14M, but Pulte Homes paid $20M, and our investors made over 30% IRR.

We acquired 50 distressed properties in high growth parts of North Texas, renovated with luxury finishes, and leased to high-income professionals moving to the area for the growing chip manufacturing industry. This fund is still active and returns are currently hitting our targets. House appreciation has exceeded our expectations.

We acquired a 10% interest in an entity that acquired bank-owned land with 4200 residential lots for $16M in 2013. This same land had been in escrow for $160M in 2006. The project has been renamed the Mirada, with the golf course redesigned as a Crystal Lagoon feature. The business plan is to sell bulk lots to builders.

The project was significantly delayed and has taken longer than anticipated because of the overall size of the project, Covid, increase in construction cost, and high interest rates. However as of 2024 the project is back on track and is seeing tremendous sales volume. All site development is near completion including development infrastructure, amenities, and one of the largest hand made Crystal Lagoons in the country.

Our entity, Bates Stringer-Martin Hills Ranch LLC, plans to purchase approximately 102 acres of raw land located on the east side of Danville, California. Our plans are to entitle, develop, and map the property for an estimated 19 lots, and then sell the lots off to one or more home builders in the market. Our investors have a 15% preferred return as well as a share of additional profits.

We bought an industrial building in Pleasant Hill, California sitting on 3.2 acres of land. We re-entitled the land for residential use, tore down the existing building, finished the lots and then sold the subdivision to a national builder.

Investors earned 14%+ IRR over an 18 month period.

Ridgewater LLC is a land development project of 156 fully entitled shovel ready single-family development lots in Klamath Falls, Oregon. This opportunity offered investors a significant return driven by a unique acquisition structure, a robust real estate market with favorable demographics, and an increasing demand for housing in the area. Ridgewater LLC has negotiated a very favorable and unique acquisition real estate option agreement.

Under the terms of this agreement, the company does not pay for the lots until the homes sell to a third-party buyer. Normally, the company would have to pay approximately $9,420,000 to purchase the land in advance, but under this option agreement, the lots are paid for as sales happen, greatly reducing the capital outlay.
 The option agreement has the company paying $60,000 per finished lot for the first 139 lots at the time homes are sold to a third-party buyer. The last 17 lots are then signed over to the company in consideration of the $1,020,000 option payment previously paid.

The company provided short terms loans to one of RealWealth’s turnkey rental property providers in Ohio for the acquisition and renovation of single-family residences and small multi-family units. These rental properties were then sold to real estate investors. The loans are secured by 1st position deeds of trust.

The fund has made consistent distributions to its investors with 8% returns. The fund was dissolved in 2022.

We acquired 153 acres of raw land in Belgrade, near Bozeman, Montana. Our initial plan was for 601 lots in 2018, but we were later able to increase the approved lots to 662 dwelling units. As of mid 2024 the site work for Phase I and II have been completed and we have 343 lots are finished. We have closed sales on 203 homes and sales are back on schedule, after some slowing down completely during Covid.

Higher interest rates (2024) have slowed sales a bit, however the area has seen tremendous increase in home values since the project has started. As of Q2 2024 Investors have received around 80% of their capital back and are entitled to a 15% preferred return plus a share of profits. Both the developer and builder are optimistic due to increased home prices over the last couple of years that the project will perform as originally anticipated even with mentioned delays.

We acquired 21 acres of land, walking distance from the State Capitol Building and downtown Carson City, NV with the intention of building detached townhomes. Our map was approved for 149 homes in 2019. COVID-19 shutdowns delayed construction, higher costs to build increased pricing, and rising interest rates slowed down sales.

As of July 2024 all of the site work for Phase I and II has been completed and lots are ready to be built on. We have sold on 46 homes and we do expect demand for these homes to pick up as the area continues to grow, especially if interest rates start to decline.

We partnered with an experienced developer and acquired 72 acres of entitled land near Park City, Utah, just 25 minutes from the Salt Lake City airport.

A portion of that land will be developed into single-family residences on 97 entitled lots. The final properties will be a mix of single-family homes, townhomes, duplexes, and deed-restricted properties. The remaining acreage will remain open space. Horizontal construction began in 2018, and the townhomes in Phase I are sold out. Phase II and III are coming soon.

In 2018 the development was recapitalized and existing debt investors in RWN Discovery LLC were allowed to convert to an equity position, remain in the existing debt fund or exit the fund. As a result the principal balance on the loan was reduced to $1,175,000 in Sept 2018. Another affiliated fund, RWN Discovery II, LLC holds the majority equity position in the Discovery Ridge development.

Recent updates

An 1831 acre master planned community surrounding the brand new Texas A&M University San Antonio (TAMUS) had been tied up in litigation for 7 years. The owners acquired a hard money loan and needed a quick sale for $26.5M.

We purchased the note for $13M at 10% interest for a 6 month term, with the hopes of reselling the property for twice what we paid (doubling investor returns in just a few months). The owners were able to pay off our loan, and our investors earned the 10% interest

We purchased 26 acres of commercial land, adjacent to our residential development, the Mirada, for $380,000 (it had previously sold for $6.5M in 2004). Once construction began on the Mirada project, we then sold half the land to a large grocery chain, and the remaining pads to other commercial developers.

Investors received their 15% preferred return plus profit in 2021.

We purchased 100 acres of entitled land just 15 minutes west of Reno for $12.5M. We raised an additional $4M to finish out the lots and build the first phase of spec homes. We contracted to sell a portion of the property to a 3rd party, and the proceeds from that sale helped fund the construction on the remaining lots.

Investors received their capital back and a majority of the preferred return. Investor IRR was approximately 10.5% depending on when capital was invested.

We decided to form a new investor group to buy lots from Argos.  There was a severe shortage of homes in the area due to Tesla moving its Giga Factory to the area. We built more affordable homes and sold them out by 2021.

Investor earned approximately 8% IRR

We acquired a 208 unit apartment building next to the Google headquarters in Mountain View, CA. The business plan was to re-entitle the 9.8 acres to higher density (500+ units) and offer 30% of the units as affordable. Protestors delayed the process by years.

Even though we sold the building for $48M more than we paid, holding costs ate up most of the profit.

Our business plan was to acquire single-family rental homes in Florida, Ohio, Michigan and Georgia utilizing our referral network of local operators in those locations. We picked these areas based on cash flow and appreciation potential due to migration trends.  Starting in 2017, we purchased homes and provided investors cash flow distributions until 2021 when we decided it was an opportune time to sell the assets.  Many of the homes had appreciated significantly and were sold for nice gains. 

However, several of our Detroit homes homes suffered from tenant holdovers and serious maintenance issues which resulted in a longer hold time without income.  We sold the final Detroit homes in early 2023.  Investors were entitled to an 8% return and a share of any additional profits. However due to the time delay during the sales phase, along with the unexpected repair expenses, the overall rate of return was between 6-7% after investors received their full return of capital.  

The business plan was set up as the same structure as the 2016 Wealthy One fund. This fund was short-term lending to one of RealWealth’s turnkey rental property providers in Ohio. Funds were secured in 1st position at 65% ARV. Investors received 8% as projected plus full return of their capital.

This fund was dissolved in 2023.

The company was set up to provide financing and acquire the the Challenge Diary building in Dublin, California. This debt fund holds a note in 1st position against the Challenge Dairy commercial building. Investors receive quarterly distributions towards their preferred return and will receive the balance when the property is sold.

The rents in the building have been raised and property is currently on the the market for sale with interest from potential buyers.

The Company was established to provide financing for one of our existing real estate development projects located near Park City, Utah.  The Company provided a short term loan for Discovery Ridge, LLC to pay off a prior related entity loan and fund continuing operations of the project.  The loan was for one year at a 13.5% interest rate and was secured by a deed of trust covering all remaining lots owned by Discovery Ridge.  The lien was in second position behind the acquisition and development loan held by a local bank, which is now paid off.  Investors were to receive a 11 % return on their investment in the Company.  

The Borrower encountered cash shortfalls due to a variety of issues, including Covid supply chain shortages, increased material costs, and interest rate hikes.  These issues were compounded by the fact that the developer was required to build over 30 units of deed restricted homes for workforce housing that was set at 2017 sales prices. Even though the cost to build the units has nearly doubled, the sales prices cannot be increased.  This caused significant cashflow issues, which prevented the Borrower from paying the loan when it was due in 2023. 

Although the Borrower has paid down an amount over 25% of the original capital balance, we are pursuing options, including foreclosure, to secure the remaining collateral in an effort to maintain asset values that can ultimately be used to return capital to our investors. 

In 2016, we invested in 800 acres of land in Costa Rica with Rise CR LLC who was to develop an eco-friendly residential community and spa retreat center near one of the fastest growing cities in the area. A new international airport was slated for development within 20 miles of the property and new roads were being constructed. The land was entitled and some earth work began, as well as the development of a luxury “glamping” site which would operate as a base for would be homebuyers to experience the community.

However, financing for construction did not materialize, and after several years it was determined that the original development plan was not feasible. Further difficulties unfolded when the country closed its borders during COVID in 2020. Interesting, following COVID, demand for sustainable, off-grid living in nature has increased. Seeking to take advantage of that interest, the manager of Rise CR LLC has pivoted the business plan to sell/lease lots in Phase One of the project which is accessible to existing public road and provide a sustainable community living space, with a school and a co-working space for residents. There is also a private airport landing strip on the property.

Sales have been improving over the last few years and the manager continues to push forward to obtain the desired eco-friendly residential community.

We invested in a Company that had acquired 69 acres of entitled land near Park City, Utah, just 25 minutes from the Salt Lake City airport. The plan was to build 97 residences on just 22 of the acres, with the remainder held as open space per county demands. Horizontal construction began in 2018, and the townhomes in both Phase I and II were successfully built and sold. 

Some custom homes have been constructed, but the development of the intended number of homes was impeded by numerous issues, including hitting unanticipated rock and the COVID pandemic in 2020 which resulted in numerous shutdowns, the loss of the general contractor and significantly increased labor and supply costs and difficulty in obtaining supplies.  This was compounded by the fact that the developer was required to build over 30 units of deed restricted homes for workforce housing that had set sale prices set back in 2017, and cannot be increased regardless of rising construction costs.  

The resulting shortfalls created a significant cash drain.  Over the last couple of years the developer has been selling lots in order to make required loan payments, but the remaining loan is now in default and likely to foreclose.

We invested in this project, along side other investors, to purchase raw land directly off of Highway 5 just north of Redding, California and build a wine village. The original business plan presented to us was to obtain permits and construction financing to build 17 tasting rooms, 2 restaurants, a gift shop and event space. The concept was to showcase the many hidden Northern California’s wineries, who would be willing to pay a premium for the added exposure and direct-to-consumer sales.

Unfortunately, new California regulations and severe wild fires delayed the project. When the managing entity finally received permits, Covid hit, and they have been unable to obtain commercial financing. As of early 2024 the managing entity/owner of the property advised us that he has the property listed for sale but is also talking with local developers to explore alternatives. Options might include RV/boat storage, electric vehicle charging, affordable housing or fast food/gas station.

We partnered with an experienced commercial development group to purchase land in Belfield, North Dakota with the intention of entitling and developing the land for mixed-use commercial, and then selling the pads to businesses. The land is located between Hwy 94 and Hwy 85, a main thoroughfare for North Dakota and just miles from the planned Davis Refinery. The region sits atop the Bakken, Three Forks, and Tyler shale formations. The area was thriving with oil industry activity at the time.

OPEC dropped oil prices after we purchased the land, and activity in the region slowed dramatically. The other large-scale oil projects that were slated for development were stalled. With today’s environmental policies and the push for clean energy, shale activity has not picked up. We own the property outright so our holding costs are manageable as we wait for more favorable conditions. When timing is right and interest rates decrease we will look to sell the land.

Lessons learned: Oil towns are volatile. This was inherently a riskier investment, as was disclosed in the offering documents and in presentations. The timing was not on our side, but we are able to wait it out.