PATCH OF LAND PRESS & MEDIA GUIDE
NOVEMBER 2015 If you want to go quickly, go alone. IF YOU WANT TO GO FAR, GO TOGETHER.
Patch of Land (POL) is a leader in alternative real estate lending that brings Our transparent, simple and efficient solution allows borrowers and investors together through a simple online interface. Patch accredited investors to easily diversify their funds while giving borrowers reliable access to capital for of Land solves the problem of traditionally inefficient, fragmented, rehabilitating properties in need. In fact, we prefund and opaque real estate lending with proprietary technology and every loan with our own money so we look at each a data-driven process that provides transparency, and scalable, investment opportunity as if our own skin was in the game - because it is. This way, borrowers receive the efficient underwriting. Patch of Land meets the growing demand funding for their projects without delay, while lenders in real estate debt financing with a system that eliminates can start earning interest on their investment right away. unnecessary delays and fees that borrowers traditionally Patch of Land fills the void in between slow, over- experience when seeking financing. The Patch of Land regulated banks, and hard money lenders that cannot marketplace offers investors easy diversification into supply timely or consistent sources of capital. Together real estate across 25 states and growing, to date, with our marketplace of investors and borrowers, we facilitate the work of rebuilding neighborhoods, with low minimums and a best-in-class, secured increasing property values, creating jobs, and stimulating legal loan structure, while providing borrowers local economies throughout the nation. access to reliable, consistent capital and prefunding for real estate projects.
2 HOW WE WORK
Patch of Land is both complementary and disruptive to traditional means of borrowing and funding real estate projects. Think “Tinder for investors” or “Kickstarter for borrowers”, each looking to fund, or find, their next real estate projects, Patch of Land makes investing and borrowing for real estate simple, easy and transparent.
3 HOW WE WORK
FOR BORROWERS Unlike traditional means of real estate funding, Patch of Land provides quick, reliable and consistent access to capital, which is often difficult for small businesses to access, especially for value-add residential and small balance commercial real estate.
We’re able to fund projects across the country and can do so within as little as five days, with LOIs issued within 24 hours of application. Additionally, we’re repeatable. This is possible because, unlike other lenders, we truly want our customers to grow their businesses, and succeed at real estate, so we create partnerships with our borrowers—once we know them, the lending process becomes even faster, and easier!
One of our key differentiators and values, is that we prefund our loans so borrowers don’t have to wait to get their funding. It’s our job to have capital ready to lend, and we believe it’s our customers’ job to continue to find the best real estate opportunities so they can take their businesses to the next level.
4 HOW WE WORK
FOR INVESTORS Patch of Land makes it a no-brainer for accredited and institutional investors to invest in real estate debt in a world where regulation and risk aversion have make banks more hesitant to lend, leaving vast amounts of undervalued real estate unfunded.
Investors simply go online, pick properties and loans to review, and evaluate the opportunities from the due diligence information provided, including property information, appraisals, downloadable documents, market data, risk ratings, and borrower history. If they like a property they can proceed through an e-commerce powered platform to quickly and easily invest, 100% digitally—from a desktop, tablet or mobile phone in a matter of minutes. It’s that simple and simply doesn’t exist anywhere else.
We’ve shaken things up by giving accredited investors the ability to evaluate and invest in real estate across the country, without any active management on their end; we manage everything, and investors have 24/7 access to their investments and returns, where they can see monthly interest payments hit their accounts, new weekly loan opportunities and updates to existing investments.
5 OUR HISTORY
In the wake of the Great Recession, Patch of Land united their ideas, experience and resources in an alternate finance company where transparency, low minimums, project-by-project Jason Fritton, a successful e-commerce investment and ease of transaction would set the stage for real change and real profit. AdaPia d’Errico soon joined the team, bringing her diverse entrepreneur, wanted to help cities revive proficiency in both branding and strategic marketing as well as her banking with finance solutions by allowing people to and investor expertise to introduce Patch of Land to the world and help position the company to achieve its mission. invest in themselves in their communities. From the beginning, Patch of Land has been unique in focusing on debt- based, smaller cap investments at a larger volume. Keeping this focus helps He was among the earliest lobbyists for the JOBS Act stimulate entire communities and local economies in a multitude of ways, (Jumpstart Our Business Startups Act) of 2012, to such as creating new jobs and increasing property values. broaden and democratize availability of business capital— Patch of Land also differentiated itself early on by prefunding all of our real including the crowdfunding exemptions he’d worked for. estate projects. From our very first loan, prefunding has ensured quick, on- Upon its successful passage, he joined forces with his time closings for our borrowers. Our investor base also knows prefunding brother Brian Fritton, an award-winning enterprise-level means their money will begin earning interest quickly, instead of sitting in escrow accounts. software engineer and system architect, and L.A.-based technology and real estate entrepreneur Carlo Tabibi, and These benefits continue to set Patch of Land apart from the competition together they created Patch of Land. and help pave the way not only for our company’s ongoing success, but especially for the community revitalization that sparked its founding.
6 A TIMELINE OF EVENTS
MARCH 2011 FEBRUARY 2013 MAY 2013 FOUNDING BROTHERS FORMAL ANGEL INVESTMENT DEVELOP CONCEPT INCORPORATION FROM THIRD CO- FOUNDER
FEBRUARY 2014 OCTOBER 2013 NAMED TOP 10 MARCH 2014 PATCH OF LAND LENDS REAL ESTATE FIRST $1 MILLION IN TO FIRST BORROWER CROWDFUNDING LOANS IS REACHED PLATFORM
DECEMBER 2014 APRIL 2015 MAY 2015 FIRST REAL ESTATE PATCH OF LAND LARGEST 506(C) CROWDFUNDING RAISES $23.6 MILLION RESIDENTIAL COMPANY TO IN SERIES A FINANCING CROWDFUNDED LOAN CROWDFUND ITSELF
JUNE 2015 JULY 2015 SEPTEMBER 2015 NAMED ONE OF $10 MILLION IN $10 MILLION ENTREPRENEUR’S 100 LOANS IS EXCEEDED RETURNED TO BRILLIANT COMPANIES IN ONE MONTH INVESTORS
7 OUR JASON FRITTON CO-FOUNDER & CEO LEADERS [email protected]
BRIAN FRITTON CARLO TABIBI CO-FOUNDER & CTO CO-FOUNDER & COB [email protected] [email protected]
ADAPIA D’ERRICO AMY WAN CMO GENERAL COUNSEL [email protected] [email protected]
8 OUR PERFORMANCE
Since its inception in October 2013*, Patch of Land has funded more than $64,000,000 in loans nationwide and delivered over $11,000,000 in principal and interest to investors, with yields as high as 12%
SINCE INCEPTION, OCTOBER 2013, THROUGH OCTOBER, 2015
9 OUR PERFORMANCE CURRENT STATS CUMULATIVE MONEY INVESTED IN PATCH OF LAND
$80,000,000 LOANS FUNDED THROUGH PATCH OF LAND $64,951,300 $60,000,000
VALUE OF PROPERTIES FUNDED
$40,000,000 $82,547,560
NUMBER OF LOANS FUNDED $20,000,000 167
TOTAL FUNDS RETURNED TO INVESTORS $0
Oct 2013 Jan 2014 May 2014 Sep 2014 Jan 2015 May 2015 Sep 2015 $11,244,916
Average Loan Average Blended % of Loans with Average to ARV Rate of Return loss of Principal Loan Size 39.93% 11.86% 0.00% $378,287
SINCE INCEPTION, OCTOBER 2013, THROUGH OCTOBER, 2015 10 OUR PERFORMANCE GEOGRAPHICAL DIVERSIFICATION
NH VT
RI MA
CT NJ
DE MD
DC
STATES CURRENTLY SERVED STATES PATCH OF LAND STATES PATCH OF LAND BY PATCH OF LAND CAN CURRENTLY LEND IN CURRENTLY CANNOT LEND IN
SINCE INCEPTION, OCTOBER 2013, THROUGH OCTOBER, 2015 11 OUR PERFORMANCE TYPES OF PROJECTS FUNDED BY PATCH OF LAND
SINGLE FAMILY RESIDENTIAL 56%
MULTI-FAMILY RESIDENTIAL 38%
COMMERCIAL PROPERTIES 3%
LARGE APARTMENT BUILDINGS 1%
BULK RESIDENTIAL 0%
OTHER 3%
SINCE INCEPTION, OCTOBER 2013, THROUGH OCTOBER, 2015 12 NOTABLE SUCCESSES
Patch of Land has helped build wealth and grow communities all across the nation. By partnering with our borrowers to help drive their success, we have contributed to the continuing revitalization of America.
13 NOTABLE SUCCESS
OMAR S. BORROWER, NEW JERSEY “I think Patch of Land has been instrumental in growing communities, (like ours in) Newark, New Jersey. If you think about it, overnight PoL has become a driving force within that community.” That observation comes from Omar, who has spent nearly a decade in property management and real estate investing in New Jersey. His more recently established development team, SRB Group LLC, specializes in small multi-family homes and has renovated and sold 7 multi-family properties, in addition to the wholesale of 2 additional properties in the Newark area. Committed to being a part of the revitalization of the City of Newark, SRB Group LLC has been chosen by the New Jersey Community Capital (NJCC), in partnership with Community Asset Preservation Corporation (CAPC) as a qualified borrower to bid on 156 abandoned residential properties targeted for redevelopment.
While looking for funding, Omar was referred to Patch of Land by a satisfied customer who also happened to be one of Omar’s colleagues. It took just 7 days for Omar to be contacted by Doug Cochrane, our SVP of Underwriting & Acquisitions, after he submitted his application. A week after he applied, Omar had received funding for his project and was on his way to renovating his property. Today, Omar and the SRB Group continue to work with Patch of Land and have fully funded a total of 8 properties through our real estate crowdfunding platform, all within New Jersey.
Omar believes the main benefit of working with Patch is “the ability to have immediate access to capital. It’s also very quick,” as he knows firsthand, “which is a big big benefit. Plus you prefund your loans, unlike other crowdfunding companies that make you wait for the crowd to fund your loans first.”
14 NOTABLE SUCCESS
MICHAEL K. BORROWER, CHICAGO “A totally abandoned house, turned into a gem.” That’s one of the stories told by Michael, a licensed realtor based in Chicago, with over 14 years experience as a licensed realtor, and 10 years specifically devoted to investment properties. He specializes in real estate in Chicago’s north side, and northwest suburbs. One project, in Park Ridge, Illinois—an area near O’Hare airport and several rail hubs with its own “small town” feel—was dubbed the “Windy City Refinance and Rehab” project. It is, as his video to investors puts it, “a story of a sad house that needed some love, but didn’t get it—until Patch of Land came to town.”
That “sad house” was a mid-century diamond-in-the- rough, but neither traditional banks or local hard money lenders would give Michael the money to save this “house that would otherwise be torn down,” a victim of the wrecking ball, and another loss to the local architectural heritage and neighborhood feel of Park Ridge. Then Michael found prefunding from Patch of Land, and within a week, reconstruction began.
Along the way, Michael provided his Investors with property updates which included an amazing video, photos, and detailed descriptions of what phase of work he was in, and he’d be working on next. Construction showed the nearly-abandoned house literally opening up to light, as hardwood floors, are put in, the living room expanded, counters retiled, fixtures modernized, and the house goes from “sad” to “beaming!” After successfully completing Michael’s project on September 15, 2015, Patch of Land officially repaid another loan to its Investors, and we continue to look forward to sparing more “gems” from the wrecking ball, while revitalizing neighborhoods seeking to keep their “built heritage” intact.
15 RESOURCES PATCHOFLAND.COM/RESOURCES LOS ANGELES HEADQUARTERS THE PATCH 1964 WESTWOOD BLVD, SUITE 350 PATCHOFLAND.COM/BLOG LOS ANGELES, CALIFORNIA 90025
FREQUENTLY ASKED GENERAL PRESS QUESTIONS PATCH OF LAND PRESS DEPARTMENT PATCHOFLAND.COM/FAQ [email protected]
888-959-1465 patchofland.com [email protected]