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Asset Management Monthly Update, July 2021

After the COVID-19 pandemic’s onset in Q2 2020 triggered upheaval and uncertainty in financial and real estate markets, we wanted to provide GROUNDFLOOR investors with information about our asset management team’s activities. 

On the heels of our extensive stress test analysis, which looked at the potential effects a coronavirus-related recession could have on our investors’ portfolios, starting in May 2020 our team began publishing weekly updates on loan repayments and asset management activities to provide a transparent look at how our loans were actually performing in real time. 

As 2021 continues, we are pleased to continue providing transparent updates of our asset management team’s activities on a monthly basis. This latest installment looks at activity from July 2021. 

You may view activity from previous periods by clicking the links below.

June 2021
May 2021
April 2021
March 2021

February 2021

January 2021
December 2020
December 13-19, 2020
December 6-12, 2020
November 29 - December 5, 2020
November 22-28, 2020
November 15-21, 2020
November 8-14, 2020
November 1-7, 2020
October 25-31, 2020
October 18-24, 2020

October 11-17, 2020
October 4-10, 2020
September 27 - October 3, 2020
September 20-26, 2020
September 13-19, 2020
September 6-12, 2020

August 30 - September 5, 2020
August 23-29, 2020
August 16-22, 2020
August 9-15, 2020
August 2-8, 2020
July 26 - August 1, 2020
July 19-25, 2020
July 12-18, 2020
July 5-11, 2020
June 28 - July 4, 2020
June 21-27, 2020
June 14-20, 2020
June 7-13, 2020
May 31-June 6, 2020
May 24-30, 2020
May 17-23, 2020
May 10-16, 2020 

Principal and Interest Repaid Over The Past Months

First, let’s take a look at the total principal and interest repayments disbursed to investors over the past four months:

Total Principal and Interest Repaid Chart, July 2021

Total Principal and Interest Repaid Table, July 2021

Aggregated Performance Metrics

Next, let’s take a deeper dive into repayment activity over the past months to get a better picture of how our recently repaid loans have been performing. We examine the metrics of loans repaid within the last month, loans repaid since the start of Q2 2020, and loans repaid year-to-date in 2021. 

Aggregated Performance Metrics Table, July 2021
It's important to note that the above table shows the performance of loans that were repaid during the time periods noted, not the performance of loans originated during these timeframes.

Last Month’s Repayments - July 2021

This table presents loans that were repaid within the previous month, with details on the status, actual vs. expected term, actual vs. expected rate, and the exit valuation (sales price or appraised value at time of refinancing):

Loan Repayments, July 2021_1Loan Repayments, July 2021_2Loan Repayments, July 2021_3*NOTE: Actual rate is not inclusive of any promotions. Individual repayments are dependent on how long your principal is active in a given loan.

Key To Loan Status Column:
Current - loan remained current throughout the term and repaid with full principal (plus interest)
Default - loan was resolved while in default
Workout - a workout plan was put into effect and the loan was resolved under the terms of the workout agreement
REO - GROUNDFLOOR assumed title to the property (either through foreclosure or deed in lieu) and sold the property.

Links to the loan detail pages for the above loans:

10246 Elmhurst Dr
1306 Greenbrier
2209 Royall Ave
310 Elizabeth Ln
1611 Signet Dr
611 Cherry St
306 West Washington St
639 Mountain Pl
1384 Lyle Ave
7229 Central Ave
553 Rockwell St SW
1903 McDower Ln
904 South Park Dr
1520 Rogers Ave SW (LRO #1, LRO #2)
1484 Norman Berry Dr
2096 Kipling Cir SE
2504 Gray St
720 Bayard St
Woodbriar Circle (8 Units) #4
8119 Oak Hollow Dr
849 Victory Garden Dr
2496 Rest Haven Ave
4379 Tarragon Ave
4289 Inverness Ct NE
2645 Edgewood Ave W
4741 Guy St
1016 26th St
2655 Glenwood Ave SE
4055 Ashford Dunwoody Rd NE (LRO #1, LRO #2, LRO #3)
605 Thayer Dr
2719 Joyce Ave
3910 Rogers Ave
118 South Live Oak Ct
927 Palmer St
6221 Lee Pl
804 Hilltop Dr
4417 Dolly Ridge Rd
931 East Ramseur St


Special Situations Repaid Last Month

Next, we provide a monthly overview of special situation loans we resolved in the prior month. 

Last month, a total of 38 loans were repaid. 21 of them were current, repaying on time and in full. 17 were special situation loans, the details of which are below:

1306 Greenbrier - Repaid Out Of Default

The project began in December 2020 and the loan had an original maturity date in June 2021. The project was progressing as planned and renovations were being completed according to schedule. In April 2021, the borrower advised that renovations were complete, a tenant was in place, and they were pursuing a refinance of the loan. The refinance process continued as the maturity date passed, so GROUNDFLOOR issued a Notice of Default. The refinance was completed shortly thereafter and the loan was repaid in July 2021.

611 Cherry St - Repaid Out Of Default

The project began in June 2020 and the loan had an original maturity date in June 2021. The project progressed as planned and renovations were completed a few months before the maturity date. The property went under contract and was still under contract as the maturity date passed (therefore triggering a Notice of Default). Shortly thereafter, the loan was repaid. 

553 Rockwell St SW - Repaid Via Workout Agreement

The project began in November 2019 and the loan had an original maturity date in November 2020. The project progressed as planned, but the maturity date arrived with no repayment from the borrower. GROUNDFLOOR sent a Notice of Default to the borrower in December 2020. A workout agreement was subsequently reached, giving a new maturity date in April 2021. The borrower advised in April that they were in the process of refinancing the loan. The refinance process continued through May, and the loan was repaid in July 2021. 

1903 McDower Ln - Repaid Out Of Default

The project began in March 2020 and the loan had an original maturity date in December 2020. In November 2020, the borrower advised that the project would be completed by the maturity date; however, the maturity date passed with no repayment from the borrower (triggering a Notice of Default). In February 2021, the borrower advised that they were actively negotiating with a buyer. The property remained actively listed on the market through March. In April 2021, the borrower advised that the property was under contract. The loan was repaid in July 2021.

1520 Rogers Ave SW - Repaid Via Workout Agreement

The project began in November 2019 and the loan had an original maturity date in December 2020. Renovations were progressing, but the maturity date arrived with no repayment from the borrower. GROUNDFLOOR issued a Notice of Default. In January 2021, GROUNDFLOOR entered into workout discussions with the borrower as an alternative to foreclosure. In February 2021, a workout agreement was reached, giving a new maturity date in March 2021. In April 2021, GROUNDFLOOR reached a new workout agreement, this time giving a maturity date in May 2021. The borrower advised the property was actively listed on the market in June 2021 and loan was repaid shortly thereafter.

1484 Norman Berry Dr - Repaid Via Workout Agreement

The project began in November 2019 and the loan had an original maturity date in October 2020. In September 2020, the borrower advised that renovations were complete, and in October 2020 they advised that they were in the process of refinancing the loan. The refinancing process took several months to complete, and the borrower was working with two refinance lenders at the same time to try to obtain the best rate and fastest closing. Finally, in June 2021, the borrower advised that the refinance process was almost complete, and the loan was repaid in July 2021.

2096 Kipling Cir SE - Repaid Via Workout Agreement

The project began in September 2019 and the loan had an original maturity date in November 2020. Renovations were still ongoing as the maturity date arrived, so after negotiating with the borrower, GROUNDFLOOR agreed to a workout agreement, giving a new maturity date in March 2021. The borrower subsequently advised that they were pursuing a refinance, giving a tentative closing date in May 2020. The refinance was completed and the loan was repaid in July 2021.

2504 Gray St - Repaid Out Of Default

The project began in March 2020 and the loan had an original maturity date in March 2021. The maturity date arrived with no repayment, so GROUNDFLOOR sent a Notice of Default to the borrower. In May 2021, the borrower advised that the property was under contract. The loan was repaid in full in July 2021.

849 Victory Garden Dr - Repaid Out Of Default

The project began in September 2019 and the loan had an original maturity date in September 2020. In August 2020, the borrower advised that the project was complete and that they had received an offer. In October 2020, the borrower advised that the property was under contract, with an expected closing date in November 2020. However, the contract fell through. In December 2020, GROUNDFLOOR entered into workout discussions as an alternative to foreclosure, and in January 2021 a workout settlement was reached, giving a new maturity date in February 2021. However, a tornado damaged the property and caused the buyer to back out. The borrower advised they were pursuing a refinance. The refinance process continued through the next few months and experienced some delays, but the loan was eventually repaid in July 2021.

2496 Rest Haven Ave - Repaid Out Of Default

The project began in October 2019 and the loan had an original maturity date in October 2020. As the maturity date approached, the borrower advised that the property was complete and was under contract. GROUNDFLOOR followed up about the status of the sale in November 2020 but received no response. In December, GROUNDFLOOR again reached out with no response, so in January 2021 GROUNDFLOOR issued a Notice of Default to the borrower. The borrower advised that the property was again under contract and submitted a payoff request. However, the contract fell through. In May 2021, the borrower agreed to reduce the listing price and GROUNDFLOOR connected the borrower to a potential buyer. In June 2021, the borrower advised that the property was under contract. The loan was repaid in July 2021. 

1016 26th St - Repaid Via Workout Agreement

The project began in June 2019 and the loan had an original maturity date in June 2020. After some progress had been made on the property, in November 2019 the borrower advised that they were in the process of hiring a new contractor. This process continued into 2020. In March 2020, the borrower advised that negotiations for a potential sale were underway. As the maturity date approached, GROUNDFLOOR examined a full inspection of the property and was dissatisfied with the lack of progress. Therefore, GROUNDFLOOR issued a Notice of Default in June 2020. The borrower subsequently advised that a new contractor had been hired, so GROUNDFLOOR agreed to a workout settlement that gave a new maturity date in September 2020. Renovations remained ongoing through September 2020, and the borrower advised that due to some thefts and vandalism progress was delayed. In November 2020, GROUNDFLOOR entered into workout discussions with the borrower in order to avoid foreclosure. Workout discussions continued through the new year. In March 2021, the borrower advised that the property was under contract; however, the contract fell through. This happened several times, and in May 2021 the borrower decided to pursue a refinance. The loan was repaid in July 2021. 

118 South Live Oak Ct - Repaid Via REO

The project began in July 2019 and the loan had an original maturity date in July 2020. In February 2020, the borrower advised that they were having contractor issues, which was delaying progress on the project. They also advised that they were looking into refinance options. In May 2020, GROUNDFLOOR issued a progress Notice of Default due to lack of sufficient progress on the project. The default was not resolved by the time the default period expired, so GROUNDFLOOR engaged counsel to begin foreclosure proceedings. In August 2020, GROUNDFLOOR was informed that a foreclosure auction was scheduled for October 2020. The auction occurred in October 2020, and the foreclosure sale was being finalized in November 2020. In January 2021, our attorney advised that there was a delay with finalizing the sale because the defendant filed an objection to the sales price. This objection moved through the court system during the first months of 2021. In June 2021, our attorney advised that a contract was in place and they were preparing a motion of sale. The loan was repaid in July 2021. 

927 Palmer St - Repaid Via Workout Agreement

The project began in November 2019 and the loan had an original maturity date in November 2020. In January 2020, the borrower advised that work on the project required additional subdivision due to City regulations. The process was expected to be completed in March 2020. In April 2020, the borrower advised that they were experiencing delays due to COVID-19, including updates to the subdivision plan from the surveyor. In July 2020, the borrower advised that they had submitted the plan to the City and were awaiting next steps. Review of the plan continued to be delayed through August 2020. In November 2020, the borrower advised that there had been a property fire and they were waiting to receive an insurance check. In January 2021, GROUNDFLOOR reached a workout agreement, giving a new maturity date in June 2021. As the maturity date approached, the borrower advised that they were in the process of refinancing the loan. The refinance process was completed in July 2021 and the loan was repaid in full. 

6221 Lee Pl - Repaid Via Workout Agreement

The project began in March 2019 and the loan had an original maturity date in March 2020. The borrower was experiencing significant delays in renovation progress, so GROUNDFLOOR’s Director of Asset Management visited the property in November 2019 to ascertain the status of the project and speak with the borrower. The project was progressing well but was not complete by the maturity date, so GROUNDFLOOR agreed to a 90-day extension, giving a new maturity date in June 2020. In June 2020, GROUNDFLOOR agreed to an additional extension of 5 months, giving a new maturity date in November 2020. The maturity date arrived with no repayment from the borrower, but due to a state moratorium, GROUNDFLOOR was unable to issue a Notice of Default. Instead, in December 2020, GROUNDFLOOR agreed to a workout settlement with the borrower, giving a new maturity date in March 2021. As the new maturity date arrived, GROUNDFLOOR engaged in workout discussions as an alternative to foreclosure. Workout discussions continued through May 2021. In July 2021, the property went under contract, and the loan was repaid shortly thereafter.

804 Hilltop Dr - Repaid Out Of Default

The project began in December 2020 and the loan had an original maturity date in June 2021. In May 2021, the borrower advised that they were in the process of refinancing the loan. The refinance process continued through the maturity date and into July 2021. The loan was repaid in July 2021. 

4417 Dolly Ridge Rd - Repaid Via REO

The project began in August 2019 and the loan had an original maturity date in August 2020. As the maturity date arrived, the borrower advised that the property would soon be listed; however, the maturity date passed with no repayment of the loan, so GROUNDFLOOR engaged in workout discussions with the borrower in order to avoid foreclosure. Negotiations remained ongoing through December 2020. In January 2021, GROUNDFLOOR began foreclosure proceedings while continuing to pursue a workout agreement. Foreclosure proceedings continued through the next few months, with a foreclosure sale finally scheduled for June 2021. GROUNDFLOOR was the successful bidder at the foreclosure sale, and in July 2021 the loan was repaid.

931 East Ramseur St - Repaid Via REO

The project began in December 2018 and the loan had an original maturity date in December 2019. In November 2019, the borrower advised that they were in the process of refinancing the loan. GROUNDFLOOR’s Director of Asset Management visited the property in December 2019; after assessing the status of the property, GROUNDFLOOR agreed to a 90-day extension to allow for final touch-ups and for listing the property, giving a new maturity date in March 2020. The property remained actively listed as the maturity date approached; however, the maturity date passed with no offers and no repayment from the borrower. In March 2020, GROUNDFLOOR began foreclosure proceedings. A foreclosure sale was scheduled for August 2020; however, the sale was delayed until September 2020 due to COVID-19. In September 2020, the borrower filed for bankruptcy on the date of the scheduled sale, causing a new set of court proceedings. Bankruptcy proceedings remained ongoing through the end of 2020 and into 2021. In April 2021, the borrower advised that the property was under contract. GROUNDFLOOR continued to proceed with foreclosure actions as we awaited bankruptcy dismissal. A foreclosure sale was scheduled for June 2021, and at the sale, GROUNDFLOOR obtained the property. The sale was finalized in July 2021 and the loan was repaid shortly thereafter.

 

Special Situations Activity Last Month

Finally, our asset management team moved forward with the following special situation loans last month (see link to each individual loan page for detailed history of updates). As a reminder, all performing loans are monitored for repayment status starting at 120 days prior to maturity. 

Loan Activity:

We entered into workout agreements on the following loans last month:

We did not proceed with any foreclosure actions last month.

Real Estate Owned (REO) Activity:

We took possession of the following new properties last month:

We went under contract to sell the following properties last month:

We sold the following real estate owned properties last month:

Joey Wilson

Senior Director, Customer Success

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