Has anyone invested with Djuric Family Office aka Blake Capital Group
Most Popular Reply
Rental Property Investor · Mankato, MN · Member since 2014 · 8 posts · 8 votes
1yI was asking for more information from Blake Capital a year or so ago. After 2 emails and no reply I marked them off my list. After seeing this I'm glad I did. Thank you to the people that come forward and post about the bad and not just the good. You are doing more good for the community then just posting about your wins!
59 Replies
- Member since 2024 · 2 posts · 0 votes2y
Hi I am currently looking into their fix and flip fund- their 24% pref is hard to pass up but also doing my due diligence since I have not worked with them before
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
@Anastasia Foster
24% pref. Would cause me to not even ever considering that in today’s environment. But that is just my opinion.
Question I would ask is: what other institutional sponsors are providing that type of return and what is the risk profile?.
I don’t know this sponsor but see what happened with others who have a shiny high pref (see norada and drive planning)
7e investments53 Reviews - @Anastasia Foster
Quote from @Anastasia Foster:
Hi I am currently looking into their fix and flip fund- their 24% pref is hard to pass up but also doing my due diligence since I have not worked with them before
Perhaps a data point for your due diligence. My experience with Djuric Family Office aka now the Blake Capital Group, has not been great. Some of my frustrations include:
- - Zero transparency on where my funds were being invested. Everything presented indicated I was investing directly in the deal, however it now seems I was investing in DFO and DFO was investing in the deal.
- - Investor reports were either not received unless I asked for them, or they were received 2-3 months late.
- - K-1s were not made available until mid Sept every year.
- - Communication is poor, I have to repeatedly chase for updates. Several of my questions were intentionally avoided and unanswered.
- - Documents were promised week after week, but never delivered.
- - The investment portal is not properly managed, kept up to date or actively used to track financial progress of LP investments. Took many months of chasing to have record of my funding recorded in the portal.
- - One deal failed and the property sold in Dec, however I was not informed until Apr the following year by the lead operator. In Sept I'm still waiting for an official announcement and legal documents to be provided.
Best of luck, Cheryl - Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
@Cheryl Abram
Out of curiosity what type of return were they promoting?
Curious as another poster is intrigued by the 24% but it sounds like your return is negative 100%.
Common syndicator game of throwing out huge returns when other funds are going under because they want you to only look at that shiny number and not what their past performance has been
7e investments53 Reviews - Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes2y
@Anastasia Foster, a flipping fund is very hard to pull off, so I would be very cautious and dive deep into their operations before being overly intrigued promoted returns. Being a part-time flipper myself, I would want to know:
What is their true deal flow?
How much are they raising?
What is the average acquisition cost of the houses?
What is the average renovation cost?
How are they sourcing deals?
Who is inspecting each deal before they offer/buy?
Who is their architect for all plans and permitting?
Who are their contractors?
How are they sourcing materials? Who is in charge of procurement?
Who is overseeing the renovations?
Who is monitoring budgets and spend?
Are they going in all cash or financed? What loan terms are they underwriting?
How many deals have they historically reviewed to find one purchase?
How many flips have they done?
How many have they run at a single time?
What is their "bench" of contractors? How many times and how recently have they worked with them?
What areas are they focused on? How many flips in each area have they completed?I can think of probably another 100 questions, but you get the idea. Being a flipper for the last 10 years (always part time), there is simply a mismatch here. On one hand, if a sponsor was that successful in flips (high margin, fast turn), they wouldn't need a fund. The flippers who COULD handle the volume that a flipping fund would allow them to take on, don't need a fund, because often times, anyone flipping at that volume is already making close to 7 figures a year, and wouldn't want to keep splitting it.
Alternatively, I, personally, would not invest with a flipper that hasn't done it, a lot.
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
Quote from @Evan Polaski:
@Anastasia Foster, a flipping fund is very hard to pull off, so I would be very cautious and dive deep into their operations before being overly intrigued promoted returns. Being a part-time flipper myself, I would want to know:
What is their true deal flow?
How much are they raising?
What is the average acquisition cost of the houses?
What is the average renovation cost?
How are they sourcing deals?
Who is inspecting each deal before they offer/buy?
Who is their architect for all plans and permitting?
Who are their contractors?
How are they sourcing materials? Who is in charge of procurement?
Who is overseeing the renovations?
Who is monitoring budgets and spend?
Are they going in all cash or financed? What loan terms are they underwriting?
How many deals have they historically reviewed to find one purchase?
How many flips have they done?
How many have they run at a single time?
What is their "bench" of contractors? How many times and how recently have they worked with them?
What areas are they focused on? How many flips in each area have they completed?I can think of probably another 100 questions, but you get the idea. Being a flipper for the last 10 years (always part time), there is simply a mismatch here. On one hand, if a sponsor was that successful in flips (high margin, fast turn), they wouldn't need a fund. The flippers who COULD handle the volume that a flipping fund would allow them to take on, don't need a fund, because often times, anyone flipping at that volume is already making close to 7 figures a year, and wouldn't want to keep splitting it.
Alternatively, I, personally, would not invest with a flipper that hasn't done it, a lot.
It also sounds like they are not the ones actually doing the work, they are more a fund of funds model investing which there is nothing wrong with - just need to do an added layer of DD
7e investments53 Reviews Quote from @Cheryl A.:
Has anyone invested with the Ian Djuric at the Blake Capital Group (https://blakecapitalgroup.com/) formerly Djuric Family Office (http://djuricfamilyoffice.com/)? If so, what experience have you had?
Thanks!There offering you 24% HMMMMM Doubt it,
- Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes2y
@Chris Seveney, I hadn't looked at any details on this offering into now.
Things to consider from their own marketing:
Operating partner has done all of 10 flips.
Their entry price point is a price that I would expect any truly experienced flipper to be able to take down very easily on their own
Their historic IRR, while high by MF standards, is average, at best, from my experience with flips, and it is unknown if this is net to LP returns.I have flipped homes myself, so am not their target investor. But, there are certainly several items that would give me pause.
I do not judge anyone that sees a high projected return and becomes interested. But it goes to show everyone reading this that marketed projected returns are often the primary metric many investors look at. Hopefully, if you are reading this, you will not be lured to actually invest without diving much deeper into how any capital raiser or direct sponsor actually goes about creating that return.
- Member since 2024 · 2 posts · 0 votes2y
thanks for the thoughts to consider, and @Cheryl A. for your feedback!
Quote from @Chris Seveney:
@Cheryl Abram
Out of curiosity what type of return were they promoting?
Curious as another poster is intrigued by the 24% but it sounds like your return is negative 100%.
Common syndicator game of throwing out huge returns when other funds are going under because they want you to only look at that shiny number and not what their past performance has been
25.7% Annualized Return / 21.7% IRR.
This was my first passive investment and yes I was under educated, naive and attracted by the expressed returns. I did what I felt was good amount of due diligence, but in hindsight I missed some deeper layers of analysis.
My biggest frustration isn't with the deal failure itself, it's more with the operating performance of the GP and honestly I'm not sure how an LP can really determine this. Ask for references which are hand picked by the GP? I don't think so. Social media seems the best resource for this nowadays.
Out of curiosity, what recourse do LPs have when GPs fail to operate according to the operating agreement? Fail to produce K-1s in time for LP tax returns to completed on time, refuse to communicate with LPs, when LPs start to express frustration.
Cheryl
- 2yBasit SiddiqiBusiness MemberAccountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
I agree with others have said, if they can make 24% return, why wouldn't they just borrow at a hard money rate and just make the 24% themselves.
Basit Siddiqi CPA4.979 Reviews - Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
Quote from @Evan Polaski:
@Chris Seveney, I hadn't looked at any details on this offering into now.
Things to consider from their own marketing:
Operating partner has done all of 10 flips.
Their entry price point is a price that I would expect any truly experienced flipper to be able to take down very easily on their own
Their historic IRR, while high by MF standards, is average, at best, from my experience with flips, and it is unknown if this is net to LP returns.I have flipped homes myself, so am not their target investor. But, there are certainly several items that would give me pause.
I do not judge anyone that sees a high projected return and becomes interested. But it goes to show everyone reading this that marketed projected returns are often the primary metric many investors look at. Hopefully, if you are reading this, you will not be lured to actually invest without diving much deeper into how any capital raiser or direct sponsor actually goes about creating that return.
I just saw an email from Elevat and Blake capital raising money for another deal. So as I mentioned, my guess is they co-GP or do something.
But to answer Cheryl's question - you can file suit against them but you may be throwing good money after bad - but if they are continuing to raise money in their name then there must be something there. A lawsuit on public record against them could put some serious harm in their future endeavors especially if they have a track record of bad deals.
Note: I am not commenting on the experience of either party noted above and responding in a fashion that this information could be used for fill in the blank company.
7e investments53 Reviews Regarding the views on high returns, what advice do you have for small scale investors? If it appears to good to be true it probably is?
Why do large investment companies solicit small $50k -100k investments for multi million $ investments from people they find on Facebook?
- Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes2y
@Cheryl A., there could be a number of reasons why large investment firms focus on smaller investors. I do believe some are truly altruistic, to a certain level, and truly believe in what they are offering. It is also comfort level with the B2C relationships. It is the marketing channels they are familiar with. It is the ability to get straight to a decision maker and get an answer. In many ways, it is "lower risk".
But the not as altruistic side is: most syndicators, even those with $2bn+ portfolios, don't have the track record length to attract institutional capital. Most don't have the systems and processes internally that institutions require. Many syndicators don't have the co-investment ability that an institution would require. And, probably the biggest, the fee and waterfall structure are much more favorable to the GP when your investor base does not have many options.
As for advice, the best is to view many deals and talk to many operators. You will start to get a sense of who the marketer is and who the operator is. Utilize other people's experiences. Ask other LPs where they have been burned and what they learned from it. (A lot are in the floating rate loan lessons right now).
There are some good deals out there. There are also a lot of okay deals. Every deal will have its own risks. Unfortunately, real estate is pretty efficient, so high returns should scream to you high risk. The challenge is deciphering those risks. The asset may be fine, but the budgets are too small to actually execute. Or, rent growth is assuming 2020-2022 type market conditions. Or it is a working class area with a lot of jobs that are likely to be heavily impacted by a recession.
To understand these risks, unfortunately, takes experience. Thankfully, there are many mastermind groups out there that all you to utilize other people's experiences.
No deal is risk free. If it were, it would be priced to only generate a 5-6% overall returns. The LPs job is to create your own vision of where things are going, and then finding investments that align with that. Your second job is to learn all the ways many syndicators will spin deals.
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes2y
@Cheryl Abram
1. Yes if it’s too good to be true it is. Also review what others offer. Syndicators do not collude with each other to keep returns to investors down. If 4 syndicators offer 10% and another is offering 15-20% then a red flag should go up and ask “why is this one better” if the operator says it’s because their secret sauce I would laugh.
2. Syndicators advertise for people on Facebook and other sites because most cannot raise institutional money as to raise institutional money they need to have audited financials, a due diligence report done on them by 3rd party to start. Combined that can cost $50k+ which they may not want to pay nor their is the possibility they would not they pass the DD report.
Nothing wrong with raising money in this fashion (FB or online ads), many do it and are great sponsors.
7e investments53 Reviews Update: the second deal just failed with complete loss of all investments. Another "perfect storm of uncontrollable events".
With both failed deals they are pointing blame on poor performance from the companies they hired to manage the property and to do the renovations, which raises a few questions:
1) how can/should LPs perform due diligence on these to be hired companies?
2) seems to me(not confirmed) that the GPs failed to vett out & manage the performance of these hired companies properly & promptly. As an owner of single family rentals, it's on me to adequately vett out and keep on top of the performance of my property managers. So my question is how can/should LPs verify the lip service GPs give on their experience and handling of this space?
3) GPs tout years of experience in this space, how can LPs stay on top of GPs staying on top of hired companies?
Feels so overwhelming for an LP.
- Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes1y
@Cheryl A., a lot of syndicators seem to always point fingers elsewhere, and fail to notice that four are left pointing at them.
1) Questions about knowing who will be managing the properties and renovations. How long has syndicator worked with them? How long as that management company been in the market? What other companies the syndicator spoke with and why the syndicator picked the one they did? Is the PM investing in or in some other way financially committed to this deal (beyond the fee)? Then look at the portfolio of the company they chose. That company, hopefully, manages a lot of similar properties to the one you are investing in.
2) I can't speak to this GPs vetting process, but it is 100% the GPs responsibility. You can never truly know if the GP is just good at sales, because if they are good at sales, they will have answers for all your questions. But, the more you ask, the more details you seek, the more likely you will expose their true understanding and ability to manage managers.
3) Again, this is all questions. How frequently is the GP on site? How long have they worked with the management company? Maybe ask for contacts with the PM and talk with them.
Being an LP is purely based on trust. To me trust starts with people that have made a career of real estate BEFORE they start raising millions in capital. Let them show that they have experience in the space first.
And then, it comes down to seeing who you are investing with. Google, google, google. People with near perfect track records can still have deals go south. But there are people that always point the finger at others and those that take ownership of their failures. Typically the latter is the one I would rather invest with, as they are first acknowledge that they failed, and therefore have a chance to learn from it.
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes1y
@Cheryl Abram
Yes if too good to be true it probably is.
Ask around here on BP and passive pockets for opinions
Yes they put ads on Facebook because it can work - we see ads for very high returns on Facebook and people fall in love with the number - please note you are not the first or last to go through this.
Also not all deals on FB are bad deals - they just need to be vetted like every other deal.
7e investments53 Reviews - 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Chris Seveney:
Note: This post is being made based on my opinion and I was not under duress or a threat of lawsuit.So i received a voicemail this AM from a member of their team regarding my posts here on BP. I called them back around an hour later and they immediately answered.
We had a good conversation about some of my comments. Very cordial.
I am writing this because I appreciated the call and while I have no affiliation with them or have experience working with this company nor have I invested with them - they answered the phone immediately. So i cannot comment on some of the posts on their reporting etc., all i can say is the first time I dialed their number they answered.
They also were willing to share their information on the status of their current fund offering 24%.
Again I am not advocating for this company and each person needs to do their own DD, all I am saying is I appreciated someone seeing something, calling me on it and having a conversation about it.
if @Cheryl A. lost 100% of her investment then these must not be first position loans.. as even if a rehab fix and flip fails you still have SOME value in the assset its not nothing. I wonder how they are structuring these ?
Quote from @Buo Z.:
I invested in one of their projects and it seems to be failing. I've emailed them multiple times now and they have not responded at all to me about what is going on or if my investment is completely wiped out.
Sorry that's frustrating. Not sure if this helps, but here's my failed investment.
Waterford, Houston, TX - Sponsors: Community Investment Properties, Legacy Wealth Holdings, Djuric Family Office - the claim is this is the first of their deals to lose investor money. I would love to be able to fact check this.
Park North (aka Life Spring Estates), Houston, TX - Sponsors: Inman Equity, Djuric Family Office.
Best of luck, Cheryl
What legal filed docs are LPs entitled to see to help validate a deal's failure? To date all I've received is email communications from the sponsors stating the deal failed. I'd really like to see something legal in nature that supports the deal failure, however I'm not sure exactly what to ask for.
Are LPs entitled to see foreclosure, bank loan related docs? What else?
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes1y
Quote from @Cheryl A.:
What legal filed docs are LPs entitled to see to help validate a deal's failure? To date all I've received is email communications from the sponsors stating the deal failed. I'd really like to see something legal in nature that supports the deal failure, however I'm not sure exactly what to ask for.
Are LPs entitled to see foreclosure, bank loan related docs? What else?
Depends on the operating agreement and docs you signed. That will highlight was the sponsor is supposed to do and information they are to provide. There is a lawsuit from a company that invested in a deal with someone on BP (not this group) who ironically changed the name of their company after multiple failed deals) that is suing the GP and people personally for negligence because the sponsor did not do what they said they were going to do. My guess is we will probably start to see more of this as its one thing for a deal to go bad another if the sponsor is negligent and did not do what they said they would.
I did not invest in the above noted deals so I cannot comment on the structure or management but just highlighting in general where I am guessing some of failed deals may end up.
7e investments53 Reviews - Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes1y
@Cheryl A., as Chris noted, the required documentation will be outlined in the LP Agreement you signed. But given you experience with getting anything from this group, I would not hold my breath that you will even see a response, even if financial statements are required to be provided.
So, then you next step is a lawsuit to force reporting. And if you win, you still lost. You will have spent real money to get financial reports that likely show a combination of mismanagement (but likely not illegal) and general inept business decisions, which still won't get you money.
I am sorry you had this experience. Unfortunately, I don't think there is much of anything you can do to post-mortem this in a meaningful way. Avoid floating rate debt. Avoid sponsors with little to no track record. Avoid sponsors that are using seller-financing and/or recapping someone else's deal and letting that group stay on title. These are all newbie ways of doing things.
Join the conversationCreate a free account to reply, vote on answers and follow this thread.