QUARTERLY UPDATE - 2018 Q1
Dear Rubicon Investor:
Rubicon Mortgage Fund, LLC is pleased to announce that investors who reinvested each month during the first quarter 2018 received a total compounded return of 6.959%. This marks the 41st consecutive quarter that the Fund has been profitable for its investors.
Quarter in Review
The Fund made 13 new loans totaling approximately 12 million dollars this quarter. The Fund also received nine payoffs from current borrowers totaling just over eleven million dollars. This was the busiest 1st quarter in Rubicon’s history from a loan origination standpoint. We feel that the development of Rubicon’s sales team combined with large marketing efforts played a major role in this landmark quarter. On a macroeconomic level, high consumer confidence coupled with the anticipation of rising interest rates may have also had an effect. Between new and existing investors a little over two million dollars of net capital was invested into the fund.
Troubled Loan Update
The Fund filed two notices of default (NOD) towards the end of last quarter. Both were filed because of maturity defaults. The first loan (secured by two properties, located in San Francisco and San Mateo respectively) was paid off in full this quarter, netting the Fund an interest payment with a default rate of 18%. The second NOD was filed on a loan secured with a property in Oakland. Here, we feel there is sufficient equity to cover us and are expecting to be refinanced prior to a foreclosure sale.
Continued Outlook for 2018
We still expect rates to increase this year in our marketplace. Thus far, private rates have not kept up with conventional rates. This isn’t surprising given the enormous amount of cash on the sidelines looking to find fixed rate yields. Once some of this capital has been placed we expect rates to lift creating higher returns for all of us. Our underlying philosophy of taking what the market offers isn’t going to change. We understand our investors and their expectations for this investment. Capital preservation is our focus with the expectation of modest returns.
Accepting Money Going Forward
We are keeping a close eye on the overall capital in the Fund. If we feel as though it’s becoming too difficult to place our funds in quality loans, we will restrict new investors yet allow our existing investors to continue increasing their contributions. For now, we are accepting new accounts, but we are mindful of the total cash under management.
As always, contact us directly with any questions or comments.
Rubicon Realty Advisors, Inc., Manager
Transparency: Please note that every investor in the Fund receives monthly account statements either electronically or via hard copy. All investors also receive quarterly updates from the manager (like this one), and a copy of the Fund’s annual audit. All of the audits, in addition to the quarterly updates, are posted online on our website. If you did not receive a document, or wish to go back and review them, please contact us, or visit the website. If you have registered for monthly distributions, you should be receiving either an ACH deposited directly into your bank account or a check sent to your mailing address. Finally, all investors should be receiving an email electronic “blast” or message every time a loan is funded. We want you to see where your money is being invested! If you miss the “blast” you can go on our website and see our blog posted online.