EquityMultiple Growth Update – Q2, ’21
Steady Growth as Recovery Begins
Spring is in full swing, and states and cities across the country are reopening as vaccinations rates continue to improve. This is great news for both the overall economy and real estate markets. EquityMultiple is excited to enter the second half of the year on solid footing after achieving several company growth milestones:
Substantial Distribution Growth
Distribution volume to investors has increased over 75% annually each year since 2018. The $23M+ in distributions so far in 2021 paces us to exceed $60M in distributions for the year. This geometric growth trend paces the organization to eclipse $200M in distributions by 2022.
Realized Investments Over the Past Year
Early in the Pandemic, uncertainty impacted commercial real estate markets due to construction stoppages, supply disruptions, tenancy cash flow issues, and concerns over demand in general. After ensuring our own team’s safety, we resumed operations with a heightened emphasis and allocation of resources to our Asset Management function to mitigate challenges across our portfolio.
This approach and diligent work of our Asset Management Team resulted in positive returns. As of May 18th, EquityMultiple has exited 16 investments since March 2020 with the following results**:
- 14.4% weighted average IRR*
- 1.16x weighted average equity multiple*
- $0 loss in investor principal*
EquityMultiple’s Asset Management Team works throughout the lifecycle of every investment to protect investor principal regardless of unforeseen challenges from minor events like permitting delays to truly unprecedented macro events like a global pandemic.
A Record-Breaking Quarter
With renewed economic optimism, Q420 allowed us to quickly tap into our nationwide network of sponsor partners in various markets across the country positioning the team to originate, underwrite, and offer 17 deals totaling $29.5M in investment through the EquityMultiple platform.
This $29.5M in investment volume in Q121 is EquityMultiple’s highest all-time quarter of new investment. We look forward to continuing on this growth trajectory in the remainder of 2021 and beyond.
Substantial Updates to Your Portfolio Page
Our Technology Team has been hard at work delivering meaningful changes to the Portfolio page, delivering more insight, flexibility, and functionality to investors.
A Current Snapshot of the EquityMultiple Portfolio
A real-time look at EquityMultiple’s investment portfolio makeup is available on our Track Record utility. EquityMultiple offers investments across core commercial real estate property types of multifamily, industrial, and office (and retail to a much lesser extent). We also offer a diverse array of investments into non-core property types, particularly those that offer a counter-cyclical or recession-resistant investment thesis.
Note that EquityMultiple’s Technology Team recently made significant upgrades to your ‘My Portfolio Page’ to bring you better, more detailed views of your portfolio construction and performance.
Here is a detailed breakdown of our current asset allocation as of May 18th, 2021:
- Multifamily – 28%
- Condo – 14%
- Office – 12%
- Hotel – 7%
- Car Wash – 7%
- Mixed Use – 6%
- Industrial – 5%
- Multi-Asset – 3%
- Manufactured Housing Community – 3%
- Senior Housing – 3%
- Single-Family Rentals (SFR) – 2%
- Student Housing – 2%
- Retail – 2%
- Self-Storage – 1%
- Townhomes – 1%
- Land – 1%
- Health Care – 1%
- Medical Office – 1%
Some notable “movers”: the Hotel asset class dropped four points as a percentage of our overall portfolio — from 11% to 7% — since the last growth update. Affordable housing has been a recent focus of our Investments Team, now accounting for 3%.
This diverse portfolio of assets spans 51 geographic concentrations across the United States, reflecting a network of 62 lender and sponsor partners. This multi-dimensional diversification should position investors well as the economy recovers. EquityMultiple will continue to offer a diverse set of investments across property types, geographies, and sponsors/operators.
This diverse portfolio of assets spans 71 geographic concentrations across the United States, reflecting a network of 71 lender and sponsor partners. (Additionally, EquityMultiple investors have recently gained access to Fund investments that span the entire country). EquityMultiple investors have now participated in real estate transactions totaling over $3.4 billion in capitalization. This multi-dimensional diversification should position investors well as the economy recovers. EquityMultiple will continue to offer a diverse set of investments across property types, geographies, and sponsors/operators.
Below is a summary of the current exposure of EquityMultiple’s portfolio to the various portions of the capital structure:
As always, please let us know if you have any questions at firstname.lastname@example.org. To view live investments, please log in to the EquityMultiple platform.
*Aggregate return figures for investments realized between March, 2020 and May 18th, 2021.
**Past performance is not a guarantee of future results.
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