DiversyFund is pleased to announce the first cash dividend distribution to investors in the DF Growth REIT, LLC (REIT I) fund. This initial distribution totals $4 million, and it represents an approximate 6.1% annualized return for REIT I investors. In comparison, in 2022 stocks, bonds, and public real estate funds have returned -9.24%, -12.79%, and -13.26% year to date, respectively.*
We expect to process this dividend by December 31, 2022. You will see this distribution reflected on your dashboard under cash available. Keep in mind, the annualized return represented by this distribution is based on the sale of assets in the portfolio and does not represent the prospective total return for Growth REIT I. The fund is continuing to perform as expected.
The beginning of the pandemic caused a serious downturn in US real estate markets, and REIT I began aggressively purchasing assets from operators looking to liquidate at a fair price. Our strategy is to consistently monitor the real estate market, and in 2022 we noticed the market beginning to peak. Taking advantage of these favorable conditions, DiversyFund decided to market four of our stabilized assets. All four of these assets were sold, achieving an IRR at or above our initial projections.
REIT I is currently in the middle of its projected 5 to 7-year lifecycle. With this in mind, we have decided to redeploy some capital into additional value-add opportunities while maintaining reserves to better defend against the pending economic cycle by strengthening the fund’s portfolio. Redeployed capital from dispositions was used to acquire interests in two multifamily assets in the Dallas Fort Worth market: Cobble Hill, a 136 unit asset built in 1984 and Village Creek, a 184 unit asset built in 1980. We may acquire an additional 200 units in San Antonio, Texas. The $4 million dollar cash dividend represents just a portion of the expected total return on investments in REIT I.
Thank you for your continued support of our vision of providing access to private markets for the retail investor. We’re looking forward to 2023 and beyond and our ability to offer you more exciting investment opportunities.
*Return percentages take from iShares Core for S&P 500 Index ETF, U.S. Aggregate Bond ETF, and U.S. REIT ETF