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Altus Mid-Month Update

September 2021

As we round out the quarter, Altus is heavily engaged in executing on our current pipeline activities, while keeping a close eye on evaluating new deals. We closed the raise on a dual investment opportunity consisting of a ground-up multifamily project and industrial construction and lease-up project, and we are getting further into the due diligence and analysis of everything else we have in the works. See below for more details.

Activity Abuzz:

New Industrial (Charleston, SC) and New Multi-Family (KC MSA) Construction and Lease-up (RAISED): We closed out the equity raise for the investment in the pre-construction of a new 1.3m sq ft. industrial development in the Charleston, SC MSA, and the construction of a 399-unit (estimated) luxury apartment complex located in a 200-acre master planned development in a high-end Kansas City, MO suburb. Investments made in this opportunity are for both projects, therefore spreading risk across geographic locations and property types. Equity raised will be used to fund the pre-construction costs of the two projects, both of which already have entitlements in hand. Returns on the invested equity will accrue at 20% annual interest up until the start of construction; and will then vest into the project at the stepped up, accrued value. The ultimate investment structure is in the works and is anticipated to produce returns considerably higher than our normal offerings due to the nature of the investment.

Debt Liquidity Fund: Due to increasing demand from our investors to be able to invest into a safe, liquid investment vehicle, we created the Debt Liquidity Fund. This provides investors with the opportunity to earn a solid monthly yield (4% per annum) on funds that may otherwise be sitting around in a CD or a bank account not earning much interest. The fund is comprised of a portfolio of real estate loans that are in 1st lien position and are all below 50% LTV; with additional capital invested by Altus’s shareholders in a junior (first loss) position for further collateral. This is an open-ended fund that allows investors to redeem their position (or a portion of their position) with 30-days-notice. We are currently fully funded but there will continually be opportunity for investors to place funds as the fund is able to identify qualified loans, so let us know if you would like to be added to the wait list. We anticipate additionally opportunity to place funds will open up in the coming days/weeks.

Highfill Duplexes: After the strong success of the last duplex project we did in the Northwest Arkansas MSA we dug in looking for additional opportunity and were able to tie up land just outside of Bentonville with an agreement for the seller to obtain all entitlements for 140 duplexes (280 units) prior to our purchase. The entitlements are complete, and bids are in process with an expected closing on the purchase and commence of the project scheduled for November. It appears we will be rolling 1031 funds into the purchase and partnering with an already institutional investor for the rest of the equity so we will likely not be raising any additional equity for this project.

Oxford QOZ: Legal documentation is in process for Altus to buy into a fully entitled master plan QOZ development in the town of Oxford MS (Forrest’s favorite small town, and the home of Ole Miss). The development consists of thirteen individual construction projects that will be offered to investors as they come to fruition.

Miscellaneous: Negotiations are ongoing for the purchase of a light industrial property in the Austin metro. We have an agreed upon LOI and are close to having the PSA finalized for an existing multifamily project in Houston. If we are successful in getting either of those projects in contract, we will be able to share those details in the coming months.

Altus Asset Sale and/or Refinance:

  • Multifamily For Sale (CLOSED): Three smaller properties that were purchased as part of multifamily portfolio in Norman, OK closed last month for nice gains. One of the properties was liquidated to distribution and the other two are part of the 1031 funds likely to be used for the Highfill Duplexes project mentioned above.
  • More Multifamily For Sale: We are under contract to sell our Magnolia Place Apartments in Huntsville Alabama. All contingencies have been removed, and we are just waiting on the lender to finish what they need to do, with an expected close by the end of the month. This was a renovation and repositioning project whose original strategy was to sell upon completion. The profits from this sale are being used for the Oxford Mississippi project mentioned above.

ACG (Altus Capital Group): Private Money Lending:

Our private money business has experienced a bit of a slowdown over the summer, but we have two loans currently in the pipeline: a large land acquisition loan and a smaller construction loan. The land loan appears to be fully funded but we will be raising funds for the construction loan in the coming weeks. As always, opportunities are first offered to our active investor interest list. Please reach out to us if you have funds for lending and would like to be added to the list.

If you have interest in discussing equity or lending opportunities in greater detail, please reply to this email or call our office at (707) 932-5887.  We will gladly add you to our distribution list and/or schedule an appointment to discuss your investing needs.

Happy Investing,

The Altus Investment Team

This message is not an offer or solicitation of an offer to buy or sell any securities.  Offers are made only by prospectus or other offering materials.  The information contained herein has been obtained from a variety of sources which are believed to be reliable, but have not been independently verified, and may be subject to change without notice.  To obtain further information, you must complete our investor questionnaire and meet the suitability standards required by law.