Asset Management Weekly Update, September 6-12, 2020

BY Dave Wilson, Director of Asset Management 14, SEP 2020

 

As the financial and real estate markets continue to experience upheaval due to the COVID-19 pandemic, we understand that some GROUNDFLOOR investors may become more concerned than usual with the status of their investments. 

We recently published an extensive stress test analysis of our entire outstanding portfolio to understand what potential effects a coronavirus-related recession could have on our investors’ portfolios. While this analysis is useful to help inform our customers about how GROUNDFLOOR investments could respond to changing market conditions, we also feel it is important to share how our loans are actually performing in real time. 

To that end, as part of our continued efforts to be highly accountable to our investors and provide ongoing transparency, we are pleased to begin publishing weekly updates of loan repayments and asset management activities. This latest installment looks at activity from last week, September 6-12, 2020. You may view activity from the previous weeks by clicking the links below. 

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 Four Weeks


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

Total Principal and Interest Repaid Chart, 9.6-12

Total Principal and Interest Repaid Table, 9.6-12

 

Aggregated Performance Metrics


Next, let’s take a deeper dive into repayment activity over the past weeks to get a better picture of how our recently repaid loans have been performing. We examine the metrics of loans repaid within the last four weeks, loans repaid since the start of Q2 (which also coincides with the general onset of economic impacts in the U.S. of the COVID-19 pandemic), and loans repaid year to date. 

Aggregated Performance Metrics Chart, 9.6-12
It’s important to underscore that this table showcases the performance of loans that were repaid during the delineated periods, not the performance of loans originated during these timeframes.

Last Week’s Repayments - September 6-12


This table presents loans that were repaid within the previous week (Sunday-Saturday), 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 Table, 9.6-12

*NOTE: Actual rate is not inclusive of any promotions. Individual repayments are dependent on how long your principal is active in a given loan.
**NOTE: The borrower did not disclose the source of repayment proceeds.

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:

5113 Foxglove Cir
844 Bolton Rd NW
3024 North Bambrey St
3820 Hammond Blvd
3833 North 13th St
2400 South Ocean Dr
1011 Sims St SW
405 Orange St
814 Maple Ln
3205 West Berwyn Ave, Unit 2S
143 South Harvey Ave (Loan #1 and Loan #2)
3802 Barrington Rd
214 Oak St
3310 Taylor St
1309 Miller Ave
2949 Jones St

Special Situations Repaid Last Week

Next, we provide a weekly overview of special situation loans we resolved in the prior week.

Last week, a total of 16 loans were repaid. 5 of these loans proceeded according to schedule, repaying on time and in full with the contract interest rate. 11 loans last week were special situation loans, the details of which are below.


844 Bolton Rd
 - Repaid Out Of Default

The loan was in maturity default because the borrower failed to repay the loan on time. The property was completed and listed on the market, but due to the pandemic the property did not go under contract until mid-August. The property was scheduled to close on September 4, 2020.


3024 North Bambrey St
 - Repaid Via Workout Agreement

The loan was in maturity default because the borrower failed to repay the loan on time. The borrower was in the process of refinancing the loan, but the refinancing process was delayed due to COVID-19. The borrower was provided loan leniency in the form of a 90 day extension, and the loan was repaid under the terms of that workout agreement.


3820 Hammond Blvd
 - Repaid Via Workout Agreement

The loan was in maturity default because the borrower failed to repay the loan on time. The borrower was facing delays completing the property due to COVID-19. The borrower was provided loan leniency in the form of a 90 day extension, and the loan was repaid under the terms of that workout agreement.


3833 North 13th St
 - Repaid Via Workout Agreement

The loan was in maturity default because the borrower failed to repay the loan on time. The borrower was working on the refinancing process, but due to COVID-19 refinancing was delayed. The borrower was provided loan leniency in the form of a 90 day extension, and the loan was repaid under the terms of that workout agreement.


2400 South Ocean Dr - Repaid Via Workout Agreement

The loan was in maturity default because the borrower failed to repay the loan on time. The borrower was facing delays due to COVID-19. The borrower was provided loan leniency in the form of a 90 day extension. The property was completed and listed in June, but the borrower was not getting a good response. As a result, the borrower had to reduce the price and list the property back on the market again. The property was under contract mid-August and scheduled to close on September 2, 2020.


1011 Sims St SW
 - Repaid Via REO

The borrower was unable to complete the project by the maturity date. GROUNDFLOOR issued a notice of default and began foreclosure proceedings. At the time of repossession, the property was in a distressed state (walls kicked in, floor tiles pulled up, etc.). In the interest of recovering as much principal as possible for investors, GROUNDFLOOR determined it was best to sell the property in an “as is” state. The property was sold for $202,500. After subtracting foreclosure costs and fees, the net recovery on this property was $189,159.33, which represents a 97% recovery of principal. Impacted investors may view a more detailed breakdown of the recovery in our recent email communication.


405 Orange St
 - Repaid Out Of Default

The loan was in maturity default because the borrower failed to repay the loan on time. The borrower was working on the refinancing process to pay off the current loan with GROUNDFLOOR. Due to COVID-19, the refinancing process was delayed and took longer than expected to close.


814 Maple Ln - Repaid Out Of Default

The loan was in maturity default because the borrower failed to repay the loan on time. The borrower was facing delays completing the property due to COVID-19. The borrower was working on the refinancing process to pay off the current loan with GROUNDFLOOR. Due to COVID-19, the refinancing process was delayed and took longer than expected to close.


143 South Harvey Ave
 - Repaid Via Workout Agreement

The loan was in maturity default because the borrower failed to repay the loan on time. The property was completed and actively listed on the market in March, but due to COVID-19 the borrower was not able to sell the property in a timely manner. GROUNDFLOOR negotiated a workout agreement with the borrower to pay off the loan. The workout agreement stipulated the borrower lower the asking price to speed up a property sale as well as put down a partial loan payment of $40,000. The loan was repaid under the terms of this workout agreement.


3802 Barrington Rd - Repaid Via Workout Agreement

The loan was in maturity default because the borrower failed to repay the loan on time. The borrower was facing delays in completing the property due to COVID-19. The borrower was provided loan leniency in the form of a 90 day extension to list and sell the property, and the loan was repaid under the terms of that workout agreement.


1309 Miller Ave - Repaid Via Workout Agreement

The loan was in maturity default because the borrower failed to repay the loan on time. The property was completed and listed on the market in March. Due to COVID-19, the borrower was not able to sell the property in a timely manner. The borrower was provided loan leniency in the form of a 90 day extension to have adequate time to sell the property, and the loan was repaid under the terms of that workout agreement.

Special Situations Activity Last Week


Finally, our asset management team moved forward with the following special situation loans last week (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 have entered into a workout agreement on the following loans:

We did not proceed with foreclosure actions on any properties last week.

Real Estate Owned (REO) Activity:

We did not take possession of any properties last week.

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

We sold the following real estate owned properties last week: