Altus Equity Group Inc. is collaborating once more with Housing Group Fund (HGF) to offer a debt fund specifically for accredited investors. The AE HGF Non-Performing Notes Fund, LLC, allows investment into a portfolio of collateralized, non-performing mortgages with a 10% preferred return and additional profit sharing. The fund aims for a 15-18% internal rate of return over five years, with redemptions available at the five-year mark and every three years subsequently. Investments are safeguarded by purchasing loans at a maximum of 65% of the property’s market value and through strategic loan acquisition, robust loan servicing, and risk mitigation practices. External service providers are engaged for loan documentation, asset management, and a full legal team to handle various legal scenarios.
All loans are secured against real property
Redeemable Preferred Shares
Redemption opportunities at year 5 and ongoing every 3 years thereafter
10% Preferred Annual Return
Preferred Shares receive a cumulative, non-compounding 10% annualized
Loans throughout multiple states
60% Profit Share
Investors receive 60% of the distributable cash after the 10% preferred return is paid
Superior Risk-Adjusted Returns
Loans acquired have 35% or greater collateral coverage / equity
ACQUISITION OF LOANS ON THE SECONDARY MARKET.
NON-PERFORMING LOAN PURCHASE CRITERIA
AE HGF Non-Performing Notes Fund Structure
Investor Preferred Return
Proforma Investor IRR
Proforma Avg Annual Yield (initial 5-year period)
60/40 Preferred/Common After 10% Pref is Earned
Target Acquisition LTV
Investor Redemption Period
Initial Redemption Year 5 Every 3 Years Thereafter
HGF is currently managing a separate fund with a similar NPL strategy. That Fund was formed in early 2019 and has performed exceptionally well, despite a dearth of NPLs available to purchase during that time frame (and until quite recently). Below is a high-level overview of that Fund’s performance as of Q4 2023. Because of the nature of the NPL business plan, the data below have been separated in two categories which include Fund-Level return calculations based on both unrealized and realized gains. Unrealized gains would include the valuations of active loans in the portfolio while realized gains include actual investor returns to date. Both categories calculate Fund-Level returns before the sponsor promote structure.
This presentation has been prepared by Altus Equity Group Inc. & HGF Management Company LLC exclusively for informational and discussion purposes only and is intended only for the person to whom it has been delivered. This presentation is not an offer or solicitation with respect to the purchase or sale of any security. Any financial information contained herein is preliminary and unaudited. If Altus Equity Group Inc. & HGF Management Company LLC organizes an entity to invest in the project described herein and makes an offering of that entity’s interests, any investment decision in connection with such entity should be made based only on the information contained in the applicable offering documents, which will be provided to prospective investors. Any information contained in this presentation is subject to, and qualified in its entirety, by the information provided in any such offering documents. This presentation is strictly confidential and may not be reproduced or redistributed in whole or in part nor may its contents be disclosed to any other person under any circumstances. It is not intended to constitute legal, tax or accounting advice, or investment recommendations. No representation or warranty is made as to the accuracy, content, suitability or completeness of the information, analysis or conclusions or any information furnished in connection herewith contained in this presentation. Altus Equity Group Inc. & HGF Management Company LLC (HGF) and its members, partners, or associates expressly disclaim any and all liability for express or implied representations or warranties that may be contained in, or for omissions from or inaccuracies in, this presentation or any other oral or written communication transmitted or made available to a prospective investor. Information in this presentation constitutes “forward-looking statements,” which can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “anticipate,” “target,” “project,” “estimate,” “intend,” “continue” or “believe” or other variations thereon or comparable terminology. Due to various risks and uncertainties, actual events or results or the actual performance of any investment may differ materially from those reflected or contemplated in such forward-looking statements. More specifically, the projections described herein may be adversely affected by various factors, including but not limited to: future operating results, the value of the assets and market conditions at the time of disposition, any related transaction costs, and the timing and manner of sale, all of which may differ from the assumptions contained herein on which the valuations contained herein are based.