Ashcroft capital: Additional 20% capital call

Syndications & Passive Real Estate Investing
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Ashcroft capital: Additional 20% capital call

Jon Zhou
Sacramento, CA · Member since 2017 · 20 posts · 28 votes

After many of the Ashcroft capital syndications paused distributions, I get this surprise email this morning saying all LP investors need to pay additional 19.7% of invested capital call  

anyone have experience with capital calls and syndications? Is there ever a position outcome to these or are we putting more money into a failing syndication?

“Thank you for your patience as we continue to navigate our way through this current economic cycle and unprecedented time in the capital markets. We recognize that this email contains a substantial amount of information, which is why a member of our Investor Relations team will be contacting you shortly to address any questions.

We need to solve for three major factors as it pertains to Elliot Roswell:

  1. Allow the multifamily market time to stabilize.
  2. Meet liquidity needs for the rate cap, capital expenditures and unexpectedly high debt payments.
  3. Resume renovations which have been temporarily paused.

How do we achieve this?

Based on feedback from our existing lender, other potential partners, and the significant capital requirements to potentially buy down the loan to refinance, we determined the best path forward is a successful LP capital call of 19.7%. This will allow us to maintain flexibility to potentially sell the property within 24 months.

This is Ashcroft’s first capital call, and while it’s regrettable to take this step, our primary focus remains safeguarding your investment. Therefore, all LPs must participate 

Elliot Roswell is a strong asset that is poised for a strong rebound in value as markets improve. This is due to the property’s institutional quality and the continued growth within the Atlanta market. Moreover, demand and absorption rates are currently at 25-year highs and are continuing to trend in that direction with a 70% reduction in new construction permits and drop off in deliveries in early 2025.

We will maintain flexibility to sell Elliot Roswell as markets improve and anticipate doing so within the next 24 months. In the meantime, we need to cover rate caps costs and resume renovations so that we are best positioned to maximize your potential return.

Why is a capital call necessary?

  • Preserving Capital: If this capital call is not successful, we will have to sell Elliot Roswell in an inopportune market. This would result in selling the asset below our basis and incurring a significant loss of LP-invested equity. Specifically, if forced to sell now it would be a total loss of capital for both Class A and Class B.
  • Replacing Rate Caps: Our rate cap is expiring this year, and the projected replacement cost is $736k.
  • Resuming Renovations: Given rising inflation and labor costs, our capital expenditure exceeded initial underwriting. This prompted a temporary pause to renovations. However, resuming renovations is essential to increasing revenue, and a capital infusion allows us to resume both interior and exterior renovations. We will consistently evaluate the cost vs. benefit, adjusting the renovation scope as necessary.
  • Maintaining Lender Requirements & Loan Covenants: We (Joe & Frank) will consistently support you and our other investors through both favorable and challenging times. We’ve already extended a $2.9M interest-free short-term loan to cover various unexpected expenses, including the replacement rate cap over the past 12 months. While this was meant as a temporary solution, it must be repaid promptly to maintain compliance with loan agreements and ens
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Brian BurkePro Member
Investor · Santa Rosa, CA · Member since 2012 · 2k+ posts · 7k+ votes
2y

@Jon Zhou I don’t know anything about this deal so my comments here are intended to be general because I have a feeling that a significant percentage of passive investors will be faced with a capital call in the near future from a large array of operators, and maybe this will be helpful to them, too. I’m not an attorney, just a syndication sponsor who has survived 34 years in the investment arena, so this is not intended to be legal advice, either.

The first question you face is whether you “have to” meet this capital call. I doubt you have to, despite the language in the letter you shared stating that “all LPs must participate.” Letters to investors are not governing documents—whether you are required to fulfill this capital call depends on the language in the operating agreement, so I’d start there. It should say whether capital calls in excess of your capital commitment are voluntary or mandatory, and if they are mandatory, it should state what the penalties are for failing to fulfill it. By that, I mean the contractual penalties, not the practical penalty such as loss of principal due to foreclosure of the property, dilution, and so on.

Then, you must decide whether you “want to” meet this capital call. There is a lot to consider here.

The letter you posted states that the sponsor has extended a $2.9 million loan to the entity to cover expenses, which “must be repaid promptly.” On one hand, it’s a good sign that the operator stood behind the deal to keep expenses funded with their own cash as long as they could. On the other hand, it could be a sign that they waited too long to issue the call, or that getting their cash back from the proceeds of the call plays a role in their decision to now issue it. Maybe it’s not a factor for this sponsor, but it could be with others…just something to consider.

To address your concern of whether you “are putting more money into a failing syndication,” your mission is to analyze whether there could potentially be a positive outcome, and if you can earn a return on the additional money.

The decision is actually a bit easier in a scenario such as this where a total loss of principal is on the table. In the case of a partial loss of principal, you also have to factor in the return you could make on the principal you got back from an immediate sale. That calculation doesn’t apply here.

If a sale today would result in a 100% loss, but a sale in the future resulted in only getting all your money back (original plus the additional call), but zero profit, you are getting a 5X return on the called capital (putting in $20K to get $120K back, for example). If it took 5 years, that’s a 20% return on the 20K (in the simplest terms). Probably a decent investment. If you got half of your original investment back plus the additional, that’s a 2.5X return on the called capital, or 10% over 5 years. Still not terrible.

But the question is, can such an outcome be achieved? Only hindsight will reveal the true answer, but I have personal experience that it is possible. I was there in the great recession of 2009 and had a deal where we were totally underwater and bleeding cash but 6 years later sold and returned all capital plus a profit.

But you have to weigh all the factors to gauge your odds. You need two things for this to work: 1. you can’t run out of time, and 2. you can’t run out of money. So is a 20% capital call going to get the job done, and provide enough money to go the distance? And if it will, is there enough term left on the loan (and if not, what’s the plan to fix that)?

Here are some things to consider in your decision (i.e. questions you might want to ask):

  1. When does the loan mature? (perhaps the most important question of all)
  2. What was the loan-to-purchase-price ratio when the property was bought?
  3. How much is the property worth today?
  4. What is the loan amount?
  5. When does the rate cap expire?
  6. What is the monthly cash burn, including reserves to purchase replacement rate caps?
  7. Is income/occupancy holding up?
  8. What are the market rent growth and occupancy forecasts for the next few years?
  9. Are renovation bumps supported by the market?
  10. What happens if some investors fulfill the call but others don’t? i.e. if the sponsor doesn’t get enough money to solve the problem, what will they do with the capital that was just contributed?
  11. What place am I in the capital stack? Is there preferred equity or Mezz Debt at a higher priority than me?
  12. What are the uses of the new funds?
  13. And a question for you: If you are invested in multiple syndications, do you have enough reserves to fulfill capital calls from all or many of them? And if not, you need to prioritize the ones that have the most likely positive outcome.

You also want to think about the market and subsequent recovery. If you zoom out, real estate goes up in value. Maybe not year to year, but certainly decade to decade. I remember people saying in 2010 that prices would never get back to the 2006 peak. But by 2014 prices had not only reached the 2006 peak but exceeded it. How long will it take for the next recovery cycle to bring you back to right-side up? I’d guess five to seven years, but I could be way off base. I’m a bit of a market pessimist lately which is why I’m not invited to a lot of parties.

BP is doing a podcast on the topic of capital calls and I’m one of the two panelists. Maybe listen to that when it comes out in a couple weeks and see if any other nuggets of info come up in the discussion.

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  • Randall Joseph
    San Francisco, CA · Member since 2015 · 5 posts · 5 votes
    1y

    The latest from Ashcroft -- in the of the AVAF1 August Recap email -- does not seem terribly encouraging.

    "With the original capital call amount of $27.9M, we have a $11.7M gap in funding and have a plan to bridge most of the gap by selling Elliot Baymeadows."

    And, later in the update, Ashcroft acknowledges that the prior listing for Elliot Abernathy needs to be pulled because offers were too low (or...non-existent). "Upon receipt of initial offers, for Elliot Abernathy it is likely that we will pull the listing and work to season net operating income so the asset is valued based on the recent NOI growth."

    It's hard to avoid connecting the dots, and to expect that the planned listing of Elliot Baymeadows will also be met with anemic offers. Such is life when you're forced to sell into a less-than-favorable market.

    Are other folks still following along with this slow-motion trainwreck? Foolish to still hope that Class B investors won't be wiped out entirely?

    5Reply
    • Guy Idan
      Investor · Miami, FL · Member since 2020 · 48 posts · 25 votes
      1y
      Quote from @Randall Joseph:

      The latest from Ashcroft -- in the of the AVAF1 August Recap email -- does not seem terribly encouraging.

      "With the original capital call amount of $27.9M, we have a $11.7M gap in funding and have a plan to bridge most of the gap by selling Elliot Baymeadows."

      And, later in the update, Ashcroft acknowledges that the prior listing for Elliot Abernathy needs to be pulled because offers were too low (or...non-existent). "Upon receipt of initial offers, for Elliot Abernathy it is likely that we will pull the listing and work to season net operating income so the asset is valued based on the recent NOI growth."

      It's hard to avoid connecting the dots, and to expect that the planned listing of Elliot Baymeadows will also be met with anemic offers. Such is life when you're forced to sell into a less-than-favorable market.

      Are other folks still following along with this slow-motion trainwreck? Foolish to still hope that Class B investors won't be wiped out entirely?


       Wondering as well. They sent an email that AVAF 2 will also have a capital call. Looks pretty bad. Big shame to invest money into something that should be pretty "Safe" with not outrageous return expectation, and losing money like we invested into a meme coin.

      I take responsibility for my naivety, and will never invest in a syndication again, but shame on Ashcroft Capital for their negligence and not being prepared for what has come.

      2Reply
  • Brian Bernstein
    Member since 2020 · 9 posts · 6 votes
    1y

    I've been following along, and it seems they blended a new GP participation incentive offering—which appears to be way outside their usual strategy—with efforts to raise capital / avoid a complete loss for AVAF1 investors.  Still, the full AVAF1 picture is difficult to comprehend. Fingers crossed. 

    0Reply
  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    1y
    Quote from @Randall Joseph:

    The latest from Ashcroft -- in the of the AVAF1 August Recap email -- does not seem terribly encouraging.

    "With the original capital call amount of $27.9M, we have a $11.7M gap in funding and have a plan to bridge most of the gap by selling Elliot Baymeadows."

    And, later in the update, Ashcroft acknowledges that the prior listing for Elliot Abernathy needs to be pulled because offers were too low (or...non-existent). "Upon receipt of initial offers, for Elliot Abernathy it is likely that we will pull the listing and work to season net operating income so the asset is valued based on the recent NOI growth."

    It's hard to avoid connecting the dots, and to expect that the planned listing of Elliot Baymeadows will also be met with anemic offers. Such is life when you're forced to sell into a less-than-favorable market.

    Are other folks still following along with this slow-motion trainwreck? Foolish to still hope that Class B investors won't be wiped out entirely?


     I think many investors are going to realize that the capital calls they participated in was only to put a bandaid over open heart surgery to allow some of these sponsors time to raise money for their new deals and end up wiping not only their initial investment out but suffer losses on the capital call as well.

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  • John Teachout
    Rental Property Investor · Concord, GA · Member since 2015 · 3k+ posts · 3k+ votes
    1y

    Many syndicators and fund sponsors are still touting how well all their previous exits have done, so kicking the can down the road as long as possible will maintain that status even though there are many deals at risk. We're not in fund 1 but are in fund 2 and it's very likely we'll see a capital call for that fund as well. Our minds are already made up to not participate as I've no confidence that it would actually keep "us" from suffering a complete loss of capital. Meanwhile we continue to receive offers from Ashcroft about new offerings. I'm deleting those as they come in.

    5Reply
  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    1y

    I pay all cash double digit cap rates with NNN syndications. Buying in this way can weather cycles for optimal timing to exit and 1031 or refi with low debt. I have not been a believer in massaging debt to make the capital raise pref look appealing to accredited LP investors.

    A bunch of years ago I sold some apartment buildings. One client had about 230 units across 7 buildings. The portfolio was being dragged down by the bad buildings taking all the good buildings cash. So they were doing a bunch of work for nothing. That taught me don't buy just to buy. Purchase based on feeling very confident and conservative about the deal. The portfolio might not scale as fast but the quality should be there with less headaches and more equity upside yields. Everyone is different that is just my approach. I remember me saying on here somewhere in a post many years ago that cycles can be a game of musical chairs when no more spots the investors crash. There was one investor who took short term 3 year debt so he could shave 30 basis points off the rate versus the 10 year fixed. Now the rate has over double and paying many millions more a year in interest because he got greedy.  

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  • JD MartinBusiness Member
    Moderator
    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    1y
    Quote from @Joel Owens:

    I pay all cash double digit cap rates with NNN syndications. Buying in this way can weather cycles for optimal timing to exit and 1031 or refi with low debt. I have not been a believer in massaging debt to make the capital raise pref look appealing to accredited LP investors.

    A bunch of years ago I sold some apartment buildings. One client had about 230 units across 7 buildings. The portfolio was being dragged down by the bad buildings taking all the good buildings cash. So they were doing a bunch of work for nothing. That taught me don't buy just to buy. Purchase based on feeling very confident and conservative about the deal. The portfolio might not scale as fast but the quality should be there with less headaches and more equity upside yields. Everyone is different that is just my approach. I remember me saying on here somewhere in a post many years ago that cycles can be a game of musical chairs when no more spots the investors crash. There was one investor who took short term 3 year debt so he could shave 30 basis points off the rate versus the 10 year fixed. Now the rate has over double and paying many millions more a year in interest because he got greedy.  


     And that's the salient point. I believe a lot of these deals were put together by one of two groups:

    1. Those so (relatively) new to either syndication or REI or both that they had no institutional memory of market downturns, interest rate acceleration, frozen capital access, and other risks, sometimes all at the same time. In their minds nothing could ever go wrong because if rents didn't increase dramatically or costs increased dramatically they could just refi till you die (exit, in their case);

    2. A smaller group that understood these systemic risks and plowed forward anyway, knowing somewhere inside that they were likely duping a lot of supposedly sophisticated investors, capitalizing on the latest "pet rock" frenzy. 

    I like to think there were more naive or dumb GPs than charlatans but who can know for certain? And the LPs bear at least a significant part of the blame, because they were seduced by unrealistic return promises that (most) investors know inside are impossible or unlikely or both and even if achievable requires a very high level of risk to principal. Risk and reward are not inversely proportional - no one gets more reward for less risk, and just about everyone understands this internally because everyone would do it if not the case - but the LPs wanted to believe they were smarter than the next guy, or knew someone smarter than the next guy. In any case, if there hadn't been any market for these deals, we wouldn't be having this conversation for sure. 

    Humans are both greedy and lazy by natural design, and these types of deals appeal to both facets; you don't have to do anything and you get disproportionate riches. There's a whole lot less people that want to do it the way you did it. Even on the other forums, when I tell people that I did it by working a 50 hr W2 and using my downtime (nights, weekends, holidays, vacations) to build the business, 95% or more just tune out. Everyone wants to go to heaven, but nobody wants to die. That kind of thing :)

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  • Henry ClarkPro Member
    Developer · Member since 2020 · 4k+ posts · 4k+ votes
    1y

    Throughout these types of posts I have asked what the LPs due diligence was.  

    Market- rental rates, occupancy, inventory

    Loan- rates, term- amort/balloon, down, 

    Capex- budget and management.

    LP terms.

    An LP plays the role of a banker.  They should stress test all of the above.  What if?

    Rates are $1,009 versus $1,200

    Occupancy is 85% versus 95%

    Capex is $2mm vs $1.5mm

    Inflation is 20%.

    What is the impact to the LPs position?

    Etc. Etc

    We do the above on each Self storage location we develop.  Even at 65% occupancy versus 90% we still win.  Even with 20% inflation or cost overruns we win.  Might cover all costs plus the bank P/I but we are banking the principal payment.  

    My point is the numbers without seeing them don’t add up.  No syndication or Class should go under.  That means the money went to the GP up front which means they aren’t working for the LPs interest.  They want the current deal to look good so they can do the next deal.  

    BP podcast ??? Next should be don’t do a LP investment into a syndication if you don’t know how to do a Stress test.  

    When I do  a project I always hold back xx% from the contractor till I sign off.  Part of the syndication should include a holdback on the GP upfront fees.  

    Should you respond to a capital call?  Only after they answer the positions above.  Otherwise it blind money investing.  

    3Reply
  • Henry ClarkPro Member
    Developer · Member since 2020 · 4k+ posts · 4k+ votes
    1y

    I’m a logic person and always look for a numeric or process answer.   Per my last post.   As one of you mentioned people will be lazy.  So I could give good advice but it wouldn’t matter.

    Luckily in self storage we can be lazy since we can get rid of a customer within 6 weeks with little financial impact to us.  

    Watching a commentary on AI. Triggered the following thinking whether Syndications, LTR, STR on how the owners can be lazy using AI applications.

    Example:  My banker just installed AI software.  Sometimes they will have up to 15 docs to fill out and go thru or even know to do.  Now they all are filled out with minimal data input.  They just have to review.  

    BP can you do a post or take a lead on AI for Syndication investing, LTR and STR? This should help weed out bad investments and bad rental customers.

    Bad google reviews, bad STR reviews, bad credit, etc etc. We have had google reviews by people who have never used or contacted us. Luckily our business model doesn't use google reviews. I've looked at one star Airbnb reviews by Bnb pros whose complaints are minuscule.


    Develop or have triggered an AI review of customers and syndications.  

    1Reply
  • Eric Bilderback
    Real Estate Agent · Sisters, OR · Member since 2014 · 1k+ posts · 1k+ votes
    1y
    Quote from @JD Martin:
    Quote from @Joel Owens:

    I pay all cash double digit cap rates with NNN syndications. Buying in this way can weather cycles for optimal timing to exit and 1031 or refi with low debt. I have not been a believer in massaging debt to make the capital raise pref look appealing to accredited LP investors.

    A bunch of years ago I sold some apartment buildings. One client had about 230 units across 7 buildings. The portfolio was being dragged down by the bad buildings taking all the good buildings cash. So they were doing a bunch of work for nothing. That taught me don't buy just to buy. Purchase based on feeling very confident and conservative about the deal. The portfolio might not scale as fast but the quality should be there with less headaches and more equity upside yields. Everyone is different that is just my approach. I remember me saying on here somewhere in a post many years ago that cycles can be a game of musical chairs when no more spots the investors crash. There was one investor who took short term 3 year debt so he could shave 30 basis points off the rate versus the 10 year fixed. Now the rate has over double and paying many millions more a year in interest because he got greedy.  


     And that's the salient point. I believe a lot of these deals were put together by one of two groups:

    1. Those so (relatively) new to either syndication or REI or both that they had no institutional memory of market downturns, interest rate acceleration, frozen capital access, and other risks, sometimes all at the same time. In their minds nothing could ever go wrong because if rents didn't increase dramatically or costs increased dramatically they could just refi till you die (exit, in their case);

    2. A smaller group that understood these systemic risks and plowed forward anyway, knowing somewhere inside that they were likely duping a lot of supposedly sophisticated investors, capitalizing on the latest "pet rock" frenzy. 

    I like to think there were more naive or dumb GPs than charlatans but who can know for certain? And the LPs bear at least a significant part of the blame, because they were seduced by unrealistic return promises that (most) investors know inside are impossible or unlikely or both and even if achievable requires a very high level of risk to principal. Risk and reward are not inversely proportional - no one gets more reward for less risk, and just about everyone understands this internally because everyone would do it if not the case - but the LPs wanted to believe they were smarter than the next guy, or knew someone smarter than the next guy. In any case, if there hadn't been any market for these deals, we wouldn't be having this conversation for sure. 

    Humans are both greedy and lazy by natural design, and these types of deals appeal to both facets; you don't have to do anything and you get disproportionate riches. There's a whole lot less people that want to do it the way you did it. Even on the other forums, when I tell people that I did it by working a 50 hr W2 and using my downtime (nights, weekends, holidays, vacations) to build the business, 95% or more just tune out. Everyone wants to go to heaven, but nobody wants to die. That kind of thing :)


    In defense of the dumb, I have been saying we are in a bubble since 2009 but I have been blown by by many investors I think were less qualified bigger egos etc.  After watching what the financial engineers did during COVID how are young guys hoping to have freedom, comfort, stability, a family supposed to make that happen?, work like a sap all day with a couple cats while other dumb asses are getting rich?  This predicament is the mostly the fault of a system that has become way to reliant on asset prices.  The planners have worked to hard in skewing the gravy of the economy to asset owners at the expense of guys and gals being able to get ahead by managing their finances responsibly and putting in a hard days work.  

    You probably agree with this, but I certainly feel strong about it.

    1Reply
  • Henry Lazerow
    Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
    1y

    Investing in a friends syndication or flip is one thing, but I always thought these “public” syndications were extremely risky as they don’t care about you and can easily turn into permanent loss of capital. They get their fees either way. I still see ads for Ashcroft online, it’s crazy they still are getting new clients while doing multiple capital calls.

    2Reply
  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    1y

    Its not about how much money you make. It's about the life you want and the vision for it going through the journey creating lifelong memories that gives people lasting happiness. Money returns are hedonistic in nature. Sure I make money on syndications as a GP for NNN properties but I also love helping people and feel great where we all make money together.

    It's when syndicators set a certain money number of net worth benchmark by a certain time and they do anything to try and get there is where they can lose their soul as a human being.

    At that point money becomes their God and everything else be damned. Those are the type in general you should definitely stay away from.

    We live in a false world where lots of people are selling quackery and smoke and mirrors in the name of making a dollar.

    Should syndicators know interest rates where going to double n just a few years? Looking at history that was not very likely it would rise that much and that fast. When investing in syndications if someone is using debt on a project you the LP investor better understand every nuance of that debt with the loan abstract and the covenants. The debt can derail the deal later on when debt service rises or a call in the market forces a sale at a non-optimal time. If people get debt it's better to often have 10 year fixed debt you just have to watch out for yield maintenance or defeasance for insurance companies or CMBS type debt. The cost to break those loans early is huge.

    Instead if people feel rates might go down some in the future then loans with short pre-pay penalties or no pre-pay penalties might make better sense. I am not a fan of interest only or shorter term loans unless the income is expected to double for NOI then even with high interest rate rise upon stabilization you can still refi or typically sell with some profit.

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  • Dave FosterBusiness Member
    Qualified Intermediary for 1031 Exchanges · St. Petersburg, FL · Member since 2013 · 9k+ posts · 9k+ votes
    1y

    Well said @Joel Owens

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  • Brian Bernstein
    Member since 2020 · 9 posts · 6 votes
    1y

    Apparently, they’re now selling some AVAF1 properties to cover the remaining capital call. Distributions were initially described as “paused,” implying they would eventually be caught up,  but that language seems to have quietly disappeared. I’m invested across five funds, all currently “paused,” and it’s unclear what’s really happening, particularly with AVAF1. Is there still meaningful upside on these 2021-era properties, or are we simply hoping to recover principal at this point? And what are the chances of that even happening. The updates have been extremely vague, and I'm just wondering to what extent the principal is safe or lost.  Any insights appreciated here.  Is there a secondary market for these things?

    1Reply
    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      1y
      Quote from @Brian Bernstein:

      Apparently, they’re now selling some AVAF1 properties to cover the remaining capital call. Distributions were initially described as “paused,” implying they would eventually be caught up,  but that language seems to have quietly disappeared. I’m invested across five funds, all currently “paused,” and it’s unclear what’s really happening, particularly with AVAF1. Is there still meaningful upside on these 2021-era properties, or are we simply hoping to recover principal at this point? And what are the chances of that even happening. The updates have been extremely vague, and I'm just wondering to what extent the principal is safe or lost.  Any insights appreciated here.  Is there a secondary market for these things?


       Cannot comment on the funds themselves but with the others we have seen if you get your principal back or anything back consider it a win. Many offerings are completely wiped of investor equity. 

      Regarding a secondary market I have not seen one. There were some investors here on BP trying to sell their investment in these types of assets but with the risk of them going to zero I would expect the person acquiring it would be at 1-5 cents on the dollar. 

      Just my opinion on above and again  - cannot comment on any specific investment with this sponsor.

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    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      1y
      Quote from @Chris Seveney:
      Quote from @Brian Bernstein:

      Apparently, they’re now selling some AVAF1 properties to cover the remaining capital call. Distributions were initially described as “paused,” implying they would eventually be caught up,  but that language seems to have quietly disappeared. I’m invested across five funds, all currently “paused,” and it’s unclear what’s really happening, particularly with AVAF1. Is there still meaningful upside on these 2021-era properties, or are we simply hoping to recover principal at this point? And what are the chances of that even happening. The updates have been extremely vague, and I'm just wondering to what extent the principal is safe or lost.  Any insights appreciated here.  Is there a secondary market for these things?


       Cannot comment on the funds themselves but with the others we have seen if you get your principal back or anything back consider it a win. Many offerings are completely wiped of investor equity. 

      Regarding a secondary market I have not seen one. There were some investors here on BP trying to sell their investment in these types of assets but with the risk of them going to zero I would expect the person acquiring it would be at 1-5 cents on the dollar. 

      Just my opinion on above and again  - cannot comment on any specific investment with this sponsor.


      Man I wonder if these type of deals are appropriate for a BK reorg of debt to save the day ? or if its lost and there is no hope and who wants to pay 250k or more for a BK attorney and Receiver fees ?  
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  • John Teachout
    Rental Property Investor · Concord, GA · Member since 2015 · 3k+ posts · 3k+ votes
    1y
    The AVAF II capital call has come and gone and though we were queried multiple times, it's nope, nope, still nope. If there was any hope this thing could survive, we may have participated but with a request of an additional 19% of capital to perhaps get back 25% of the original investment (if certain favorable things took place) it seemed like a no brainer to not play along. If we get back "any" capital at all, I'll be very surprised. We've written off 100% of this as a loss and of course will never invest with this company again. (if they survive this debacle)
    3Reply
  • Lisa Verna Staggers
    Alexandria, VA · Member since 2013 · 54 posts · 19 votes
    1y

    I think your thinking about this the right way. Have no expectations and be pleasantly surprised if you get any capital back. I am in the same boat for AVAF1.  

    0Reply
  • Jason Piccolo
    Real Estate Agent · Arlington, VA · Member since 2014 · 78 posts · 37 votes
    1y

    I am hopeful after this update. ”After almost one year since we completed our capital call together, the health and performance of AVAF1 continues to elevate. The February DCSR of 1.28x surpassed our 12-month goal of 1.20x.”  
    We just 1031’ed out of the Vista 121 and into the Halston At North Lake with Ashcroft. I still feel like they are good operators. A lot of these operators got caught in these short term bridge loans. The only thing that gives me pause are operators that we diversified into other assets with like car washes and self storage that are still not paying distributions. It’s frustrating. 

    0Reply
    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      1y
      Quote from @Jason Piccolo:

      I am hopeful after this update. ”After almost one year since we completed our capital call together, the health and performance of AVAF1 continues to elevate. The February DCSR of 1.28x surpassed our 12-month goal of 1.20x.”  
      We just 1031’ed out of the Vista 121 and into the Halston At North Lake with Ashcroft. I still feel like they are good operators. A lot of these operators got caught in these short term bridge loans. The only thing that gives me pause are operators that we diversified into other assets with like car washes and self storage that are still not paying distributions. It’s frustrating. 


      This is good news for this fund right ? 
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  • Jason Piccolo
    Real Estate Agent · Arlington, VA · Member since 2014 · 78 posts · 37 votes
    1y

    @Jay Hinrichs it sounds like things are at least moving in the right direction. There are a couple of properties in the fund with rate cap expirations coming soon so you never know. The sale of one of the properties will help with the gap in the capital call funding. 

    0Reply
  • Lisa Verna Staggers
    Alexandria, VA · Member since 2013 · 54 posts · 19 votes
    1y

    I got the same update and am hopeful as well. We’ll see….!

    0Reply
  • Paul Azad
    Member since 2024 · 162 posts · 232 votes
    1y

    How the Ashcroft Capital Lawsuit Is Shaping the Future of Real Estate Syndication - Heralds Post

    poorly written piffle, probable AI bot article about Ashford, no reference to the risk disclosures in the Offering Memorandum/Partnership Agreement, which is the whole legal case. ie, did they disclose all reasonably foreseeable risks of the investments. real estate clickbait.

    Ashford acted like hundreds of other Multi-family syndicators, greedy to keep dancing while the music played rather than grab a seat in 2020 or 2021 before the music stopped in 2022, after the most easily foreseen and predicted rate rise in US history, following inflation by Trump mailing out 3.8 Trillion directly to the people. Investors/LPs due to their usual combo of profound ignorance and even more profound greed kept dancing well after the music stopped and a deafening silence could be heard by anyone qualified to hear. 

    The problem : >95% of Americans are not qualified/educated enough to buy real estate, nor any private company, nor any public company. The current law that sets "accredited investor" was written by Congress - Regulation D in 1982,
    "Net worth must exceed $1 million (excluding the value of a primary residence), or individual annual income must exceed $200,000 (or $300,000 for married couples) in each of the two previous years", and it hasn't been adjusted for inflation since. Tens of millions of people meet these incredibly low standards, and an inflation adjustment alone to 2025 would take these up to about 3.5 million net worth and 600K income alone, which still wouldn't add what's needed which is a rigorous experience component or extensive written exam. Heck, I had to fill out a 2 page form and pass an eye exam last week at the DPS to renew my driver's license. 

    sorry just venting now.  :)

    The average American investor in public companies earns about 1/3rd the return of the sp500, (JPMorgan wealth management study) which is just blindly buying the 500 biggest US companies. If they can't be trusted to buy stocks how can we trust almost anyone to comprehend CRE/macroeconomics/200 page offering memoranda etc. maybe we shouldn't.

    Happy Mother's Day🤠

    1Reply
    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      1y
      Quote from @Paul Azad:

      How the Ashcroft Capital Lawsuit Is Shaping the Future of Real Estate Syndication - Heralds Post

      poorly written piffle, probable AI bot article about Ashford, no reference to the risk disclosures in the Offering Memorandum/Partnership Agreement, which is the whole legal case. ie, did they disclose all reasonably foreseeable risks of the investments. real estate clickbait.

      Ashford acted like hundreds of other Multi-family syndicators, greedy to keep dancing while the music played rather than grab a seat in 2020 or 2021 before the music stopped in 2022, after the most easily foreseen and predicted rate rise in US history, following inflation by Trump mailing out 3.8 Trillion directly to the people. Investors/LPs due to their usual combo of profound ignorance and even more profound greed kept dancing well after the music stopped and a deafening silence could be heard by anyone qualified to hear. 

      The problem : >95% of Americans are not qualified/educated enough to buy real estate, nor any private company, nor any public company. The current law that sets "accredited investor" was written by Congress - Regulation D in 1982,
      "Net worth must exceed $1 million (excluding the value of a primary residence), or individual annual income must exceed $200,000 (or $300,000 for married couples) in each of the two previous years", and it hasn't been adjusted for inflation since. Tens of millions of people meet these incredibly low standards, and an inflation adjustment alone to 2025 would take these up to about 3.5 million net worth and 600K income alone, which still wouldn't add what's needed which is a rigorous experience component or extensive written exam. Heck, I had to fill out a 2 page form and pass an eye exam last week at the DPS to renew my driver's license. 

      sorry just venting now.  :)

      The average American investor in public companies earns about 1/3rd the return of the sp500, (JPMorgan wealth management study) which is just blindly buying the 500 biggest US companies. If they can't be trusted to buy stocks how can we trust almost anyone to comprehend CRE/macroeconomics/200 page offering memoranda etc. maybe we shouldn't.

      Happy Mother's Day🤠


       The accredited investor thresholds—$1 million in net worth (excluding primary residence) and $200,000 in annual income ($300,000 for couples)—were established by the SEC in 1982 and have remained unchanged since then.


      Adjusting for inflation, these thresholds would be significantly higher today. According to the SEC's 2023 review, if adjusted using the Consumer Price Index (CPI), the thresholds would approximate:

      • Net worth: $3,037,840

      • Individual income: $607,568

      • Joint income: $911,352

      I am of the opposite mind of most - maybe this is because I have a Reg A+ offering that requires a lot of reporting, but I think the definition of accredited should be increased to make it a lot harder for people to invest in 506c as there are other avenues like Reg A+ that can allow non accredited investors and require reporting.  In that instance it will force people to go the route that requires added reporting which should be more beneficial for the investor - of course they still actually have to be able to read the docs.
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    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      1y
      Quote from @Paul Azad:

      How the Ashcroft Capital Lawsuit Is Shaping the Future of Real Estate Syndication - Heralds Post

      poorly written piffle, probable AI bot article about Ashford, no reference to the risk disclosures in the Offering Memorandum/Partnership Agreement, which is the whole legal case. ie, did they disclose all reasonably foreseeable risks of the investments. real estate clickbait.

      Ashford acted like hundreds of other Multi-family syndicators, greedy to keep dancing while the music played rather than grab a seat in 2020 or 2021 before the music stopped in 2022, after the most easily foreseen and predicted rate rise in US history, following inflation by Trump mailing out 3.8 Trillion directly to the people. Investors/LPs due to their usual combo of profound ignorance and even more profound greed kept dancing well after the music stopped and a deafening silence could be heard by anyone qualified to hear. 

      The problem : >95% of Americans are not qualified/educated enough to buy real estate, nor any private company, nor any public company. The current law that sets "accredited investor" was written by Congress - Regulation D in 1982,
      "Net worth must exceed $1 million (excluding the value of a primary residence), or individual annual income must exceed $200,000 (or $300,000 for married couples) in each of the two previous years", and it hasn't been adjusted for inflation since. Tens of millions of people meet these incredibly low standards, and an inflation adjustment alone to 2025 would take these up to about 3.5 million net worth and 600K income alone, which still wouldn't add what's needed which is a rigorous experience component or extensive written exam. Heck, I had to fill out a 2 page form and pass an eye exam last week at the DPS to renew my driver's license. 

      sorry just venting now.  :)

      The average American investor in public companies earns about 1/3rd the return of the sp500, (JPMorgan wealth management study) which is just blindly buying the 500 biggest US companies. If they can't be trusted to buy stocks how can we trust almost anyone to comprehend CRE/macroeconomics/200 page offering memoranda etc. maybe we shouldn't.

      Happy Mother's Day🤠


      Additionally every syndication is suppose to get verification of accreditation.. from what I saw and witnessed during those times.. Some were rigorous making sure investors qualified by having a 3rd party verification company vette investor  and or having your CPA give a written letter that based on their review of your finances you met the qualifications. If this  was done religiously by all syndicators I suspect fully 50% or more of folks that are in syndication today would not be as they would not qualify.

      Instead what I saw from many syndicates is a simple docusgin questionnaire IE taking your word for it.. Now what could go wrong with that ??

       
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    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      1y
      Quote from @Jay Hinrichs:
      Quote from @Paul Azad:

      How the Ashcroft Capital Lawsuit Is Shaping the Future of Real Estate Syndication - Heralds Post

      poorly written piffle, probable AI bot article about Ashford, no reference to the risk disclosures in the Offering Memorandum/Partnership Agreement, which is the whole legal case. ie, did they disclose all reasonably foreseeable risks of the investments. real estate clickbait.

      Ashford acted like hundreds of other Multi-family syndicators, greedy to keep dancing while the music played rather than grab a seat in 2020 or 2021 before the music stopped in 2022, after the most easily foreseen and predicted rate rise in US history, following inflation by Trump mailing out 3.8 Trillion directly to the people. Investors/LPs due to their usual combo of profound ignorance and even more profound greed kept dancing well after the music stopped and a deafening silence could be heard by anyone qualified to hear. 

      The problem : >95% of Americans are not qualified/educated enough to buy real estate, nor any private company, nor any public company. The current law that sets "accredited investor" was written by Congress - Regulation D in 1982,
      "Net worth must exceed $1 million (excluding the value of a primary residence), or individual annual income must exceed $200,000 (or $300,000 for married couples) in each of the two previous years", and it hasn't been adjusted for inflation since. Tens of millions of people meet these incredibly low standards, and an inflation adjustment alone to 2025 would take these up to about 3.5 million net worth and 600K income alone, which still wouldn't add what's needed which is a rigorous experience component or extensive written exam. Heck, I had to fill out a 2 page form and pass an eye exam last week at the DPS to renew my driver's license. 

      sorry just venting now.  :)

      The average American investor in public companies earns about 1/3rd the return of the sp500, (JPMorgan wealth management study) which is just blindly buying the 500 biggest US companies. If they can't be trusted to buy stocks how can we trust almost anyone to comprehend CRE/macroeconomics/200 page offering memoranda etc. maybe we shouldn't.

      Happy Mother's Day🤠


      Additionally every syndication is suppose to get verification of accreditation.. from what I saw and witnessed during those times.. Some were rigorous making sure investors qualified by having a 3rd party verification company vette investor  and or having your CPA give a written letter that based on their review of your finances you met the qualifications. If this  was done religiously by all syndicators I suspect fully 50% or more of folks that are in syndication today would not be as they would not qualify.

      Instead what I saw from many syndicates is a simple docusgin questionnaire IE taking your word for it.. Now what could go wrong with that ??

       

       We have even seen people here on BP who invested in these syndications, admit they are not accredited and then want to sue because of it, even though they falsified the subscription agreement where they attested they were accredited but knowingly knew they were not.... For our Reg D offerings, we require 3rd party verification from CPA or other means. That is also what is nice with Reg A, it is on the investor to self certify they are non accreditd (And can only invest 10% of net worth) or accredited. Since it is qualified by SEC and has reporting requirements its left on the investor.

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  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    1y

    The problem with multifamily and larger deals is they are often porked up with debt to the max LTV possible to induce investment by LP's pumping the projected returns.

    Upon the exit for sale or the refinance the result could be disasterous because they are a slave to the existing loan and the debt markets.

    Also the exit buyer at those larger levels is almost for certain using debt to purchase. Even if they have the cash they do not want 50 or 80 million of their cash in one property. The want to geo-diversify the income stream. Now there might be one in ten thousand property in A+ market someone at that level would pay all cash for but that is super rare and not how most multifamily syndication markets. With multifamily if interest rate rises, rents flatten, and insurance, property taxes, and maintenance are more than expected the predicted returns to gain initial investment are toast.

    It's why most of my NNN purchases are 6 million and under. I know there is a high chance of a cash buyer or low LTV like 30% to purchase. The high interest rates if using 30% LTV they can still pay a low cap rate for exit because interest on loan is so small the cash on cash is still often good. The exit multifamily buyer most of them are YIELD buyers. They want yield and big equity growth for taking on a headache asset class. They are not like a NNN investor who has already made lots of money and wants a passive return. There are advantages and disadvantages to each asset class. It's more the way the syndicators pumped multifamily deals. There are posts I answered many years ago saying the multifamily is fixing to be a game of musical chairs I have seen it all before. People kept saying multifamily is indestructible blah, blah, blah. Their ignorance in the name of trying to make money shined through. I know some that did very well with multifamily but timed the exit just right and even when they did great they did not want to do it AGAIN taking 5 to 10 years of their quality of life to produce that yield. They wanted something more headache free to enjoy their life.

    NNN can also be overinflated. I often only like maybe 10 properties out of every 1,000 I review. The developers know they develop trash and sell off fast as possible and then hold the diamond tenant and locations to sell later at the best cap rates. The weaker tenants they sell quickly to get the money after getting the tenant open and operating.

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  • John Teachout
    Rental Property Investor · Concord, GA · Member since 2015 · 3k+ posts · 3k+ votes
    8mo

    We received an update for the AVAF 2 fund yesterday. We have already written this investment off as a total loss a year ago and while they have been kicking the can down the road it appears that during 2026 it's going to finally hit the ground. The update was vague but it appears the bank is going to call the loan. If sales are forced, these properties are so underwater we'll be completely wiped out. This has appeared to be the inevitable outcome and is why we didn't participate in the capital call. Thankfully our position with this company is relatively small. The occupancy still sucks and that has been one of the issues all along in my not so expert opinion.

    4Reply
    • Bobby Larsen
      Investor · Newport Beach, CA · Member since 2019 · 190 posts · 176 votes
      8mo
      Quote from @John Teachout:

      We received an update for the AVAF 2 fund yesterday. We have already written this investment off as a total loss a year ago and while they have been kicking the can down the road it appears that during 2026 it's going to finally hit the ground. The update was vague but it appears the bank is going to call the loan. If sales are forced, these properties are so underwater we'll be completely wiped out. This has appeared to be the inevitable outcome and is why we didn't participate in the capital call. Thankfully our position with this company is relatively small. The occupancy still sucks and that has been one of the issues all along in my not so expert opinion.


      Sounds like after the initial investment, you've done all you could do and minimized your losses by not contributing further. Thank you for providing these updates, it's extremely important for other LPs to stay informed. 

      1Reply
    • Dan Rowley
      Investor · Cary, NC · Member since 2012 · 214 posts · 194 votes
      8mo

      @John Teachout  sorry to hear.  One thing you could do is leave a review of your experience with Ashcroft on this 3rd party ratings platform.  This would be a service to future LPs/investors.

      https://investclearly.com/sponsors/ashcroft-capital

      3Reply
  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    8mo

    Sorry John to hear that. What's often NOT talked about with these big multifamily projects is that they are highly leveraged with improper debt and that even if you can create value it can be wiped out on exit if market interest rates are higher.

    Multifamily is HEAVILY cycle dependent on a successful outcome as market conditions have to be optimal with the exit. If they are not then all kinds of problems occur. If the multifamily syndicators projections are off even by a smaller amount it can make the project have little profit to breaking even.

    I know people that have made tens of millions with apartments and some that have lost that much. Right now I am seeing banks and lenders finally make calls on these assets to force the sale and get what they can on the loans.

    Saw a syndicator the other day for multifamily buying from another syndicator at 8 million less because the bank was forcing the sale and no longer extending out. Most all big apartment buyers use debt. So they have to buy ultra cheap in this debt environment to make the numbers work.

    Big multifamily projects are a young man or woman's game. You get older you do not want to mess with that. I value time over any amount of monetary gain because the time can never be bought back. Elon Musk just passed 700 billion of net worth and that doesn't include his futures contracts where it likely increases much more. Even with that wealth he grows another day older just like anyone else on the planet with time. He can leverage people to get more done but can't stop his aging.

    I told people on this forum many years ago that multifamily was in a hot cycle and it would fade. They didn't listen and now they are paying a huge price.

    I love NNN assets I buy because the end buyer often pays CASH. They typically care very little about yield. They care about quality of the tenant and length of guarantees term on the lease along with tax harvesting benefits.

    Someone worth 25,50,100 million is often in wealth preservation mode. So if you have an A NNN asset and want to eventually sell those buyers pay a premium. The NNN market is not a slave to interest rates like other asset classes. You will see some movement like 50 basis points to 75 basis points but not 300 to 400 swings like with multifamily.

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  • Guy Idan
    Investor · Miami, FL · Member since 2020 · 48 posts · 25 votes
    4mo

    They passed a new addendum to the contract giving priority to members who participate in the capital call. From what I understand, that addendum required approval from more than 50% of the members.

    What I find confusing is that only around 40% have funded the capital call so far, and they keep extending the funding deadline.

    If more than 50% supposedly voted in favor of this addendum, wouldn’t you expect those same people to be the first ones to fund? The fact that they still haven’t reached enough participation feels a bit strange.

    Maybe I’m missing something, but the numbers don’t seem to fully line up. Strange.

    0Reply
    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      4mo
      Quote from @Guy Idan:

      They passed a new addendum to the contract giving priority to members who participate in the capital call. From what I understand, that addendum required approval from more than 50% of the members.

      What I find confusing is that only around 40% have funded the capital call so far, and they keep extending the funding deadline.

      If more than 50% supposedly voted in favor of this addendum, wouldn’t you expect those same people to be the first ones to fund? The fact that they still haven’t reached enough participation feels a bit strange.

      Maybe I’m missing something, but the numbers don’t seem to fully line up. Strange.


       approving something and then giving the money can be two different things, as I assume (I am not an investor) but someone votes and then speaks to someone else they know who may tell them "I am not doing X ebcause of Y" and that person change their mind. That is not uncommon as we see this a lot with people who sign our docs to invest and then never send the money. That is very common.

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    • Justin R.Pro Member
      Rental Property Investor · San Anselmo · Member since 2015 · 659 posts · 600 votes
      4mo

      If the funding didn’t come in, would all investors lose their money? If so, why would you or anyone vote “No” as that capital call may be the only saving grace.

      Choosing to commit additional funds is another subject. Do you feel those funds will help save the initial capital?

      A yes vote, with no additional capital should be a popular response.

      There should not be any No votes with that person adding capital as that wouldn’t  make any sense.

      The people saying “No” and not willing to inject additional capital must believe they think the fund is failing, not a high chance of survival even with the capital call, AND not willing to place more money into it themselves.

      Without knowing the details I would think even if someone was not going to submit additional capital, Ashcroft restructuring the fund would only help the situation, but I’m not involved or know anything about this fund.


      0Reply
    • Brian Bernstein
      Member since 2020 · 9 posts · 6 votes
      4mo
      Quote from @Guy Idan:  I personally have not funded the cap call and am taking 150k loss.. The only way the logic really makes sense to me is if the restructuring voting was not weighted by participation percentages/ownership amounts, meaning a larger number of smaller participants may have voted in favor of the restructure, while larger holders voted against and have not funded.Otherwise, the numbers do not seem to fully line up. Strange.

      -------------

      They passed a new addendum to the contract giving priority to members who participate in the capital call. From what I understand, that addendum required approval from more than 50% of the members.

      What I find confusing is that only around 40% have funded the capital call so far, and they keep extending the funding deadline.

      If more than 50% supposedly voted in favor of this addendum, wouldn’t you expect those same people to be the first ones to fund? The fact that they still haven’t reached enough participation feels a bit strange.

      Maybe I’m missing something, but the numbers don’t seem to fully line up. Strange.


      1Reply
    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      4mo
      Quote from @Justin R.:

      If the funding didn’t come in, would all investors lose their money? If so, why would you or anyone vote “No” as that capital call may be the only saving grace.

      Choosing to commit additional funds is another subject. Do you feel those funds will help save the initial capital?

      A yes vote, with no additional capital should be a popular response.

      There should not be any No votes with that person adding capital as that wouldn’t  make any sense.

      The people saying “No” and not willing to inject additional capital must believe they think the fund is failing, not a high chance of survival even with the capital call, AND not willing to place more money into it themselves.

      Without knowing the details I would think even if someone was not going to submit additional capital, Ashcroft restructuring the fund would only help the situation, but I’m not involved or know anything about this fund.



      its the old adage of throwing in good money to save bad money. 
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    • Chris SeveneyBusiness Member
      Moderator
      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      4mo
      Quote from @Jay Hinrichs:
      Quote from @Justin R.:

      If the funding didn’t come in, would all investors lose their money? If so, why would you or anyone vote “No” as that capital call may be the only saving grace.

      Choosing to commit additional funds is another subject. Do you feel those funds will help save the initial capital?

      A yes vote, with no additional capital should be a popular response.

      There should not be any No votes with that person adding capital as that wouldn’t  make any sense.

      The people saying “No” and not willing to inject additional capital must believe they think the fund is failing, not a high chance of survival even with the capital call, AND not willing to place more money into it themselves.

      Without knowing the details I would think even if someone was not going to submit additional capital, Ashcroft restructuring the fund would only help the situation, but I’m not involved or know anything about this fund.



      its the old adage of throwing in good money to save bad money. 

       one question I have is when they do these capital calls, is there a third party independent financial firm who is also providing some type of report or is this coming from the sponsor? If there was a third party report that to me may have some credibility or atleast it is an unbiased opinion - or does these documents come directly from the sponsor?

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    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      4mo
      Quote from @Chris Seveney:
      Quote from @Jay Hinrichs:
      Quote from @Justin R.:

      If the funding didn’t come in, would all investors lose their money? If so, why would you or anyone vote “No” as that capital call may be the only saving grace.

      Choosing to commit additional funds is another subject. Do you feel those funds will help save the initial capital?

      A yes vote, with no additional capital should be a popular response.

      There should not be any No votes with that person adding capital as that wouldn’t  make any sense.

      The people saying “No” and not willing to inject additional capital must believe they think the fund is failing, not a high chance of survival even with the capital call, AND not willing to place more money into it themselves.

      Without knowing the details I would think even if someone was not going to submit additional capital, Ashcroft restructuring the fund would only help the situation, but I’m not involved or know anything about this fund.



      its the old adage of throwing in good money to save bad money. 

       one question I have is when they do these capital calls, is there a third party independent financial firm who is also providing some type of report or is this coming from the sponsor? If there was a third party report that to me may have some credibility or atleast it is an unbiased opinion - or does these documents come directly from the sponsor?


      my wag on this is they are produced in house.. since they are already leaking oil badly I suspect they dont have the money to hire professional 3rd party consultants. again just a wag on my part I could be way off base
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  • Salome D.
    San Diego, CA · Member since 2019 · 37 posts · 17 votes
    4mo

    I encourage you to post your reviews online, all social media, Amazon, You tube, Better Business Bureau etc etc, anything related to this company, Ashcroft and to their names. So people will get a chance to know other people's experiences with this company !!! I will possibly lose all of my investment with Ashcroft, very frustrating, these are all hard earned money!

    0Reply
  • Salome D.
    San Diego, CA · Member since 2019 · 37 posts · 17 votes
    4mo

    I encourage you to post your reviews online, all social media, Amazon, You tube, Better Business Bureau etc etc, anything related to this company and to his name. So people will get a chance to know other people's experiences with this company !!!

    0Reply
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