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Groundfloor Loans 1, LLC

Sponsored by Groundfloor Finance·

Unknown· LLC · 1 class· ● Low· PPM v1· Updated 26d ago
2 data notes▶
Unusual structureUnscored: absolute lp take
Run the numbers
Composite
27.5
median 53 −25
Pref Returnⓘ
—
median 9.0% · Real Estate Debt / Mortgage Funds
LP Take (Base)ⓘ
—
median 88.1% · Real Estate Debt / Mortgage Funds
GP Commitⓘ
0.0%
median 0.0% +0.0%
Min Investment
$100
ticket size
Offering Size
$75M
target raise
Cascade · Distributions

Where each dollar goes

$875K
LP $850K · Fees $25K · GP $0
GROSS PROCEEDS$875KGPFFees to Manager$25,000 · 2.9% of grossLPT1Return of Capital$500,000 · 57.1% of grossLPGPT4Residual Split (100% / 0%) · 40.0%Limited Partners · $350KGeneral Partner · $0pool fully distributed
Standard scenario · $500K equity · 5y hold · 1.75× exitRun your own cascade →

Deal diligence12 findings · worst high

Automated checks across the fund's extracted PPM. Every finding is shown with the evidence it's based on — proven numbers or a verbatim quote and page.

Document quality

Drafting defects found in the PPM prose — numeric inconsistencies, broken cross-references, unfilled placeholders, and defined-term problems. Each is shown with the offending quote and its page.

Numeric inconsistency — Sponsor real estate loan track record

Medium

The Sponsor's real estate/accounting team track record 'Through July 31, 2023' is stated as 'more than 4,700 commercial real estate loans' on page 81 but 'more than 2,500 commercial real estate loans' on page 101 — the same metric (same team, same date, same '$1 billion' total) is given two conflicting loan counts.

“Through July 31, 2023, our Sponsor's real estate and accounting teams have acquired and asset managed more than 4,700 commercial real estate loans with total loan value over $1 billion. ... Through July 31, 2023, our Sponsor's real estate and accounting teams have acquired and asset managed more than 2,500 commercial real estate loans with total loan value over $1 billion.”
PPM p.8195% confidence

Numeric inconsistency — Company telephone number

Low

The Company's telephone number is given as '(404) 850-9225' on the cover/notice pages (pages 3 and 14) but as '(404) 850-9223' in the prospectus summary on page 7 — the last digit disagrees.

“(404) 850-9225. Information about the Company and its affiliated entities may be found on the Groundfloor Platform ... Our telephone number is (404) 850-9223.”
PPM p.393% confidence

Spelling / typo — Janaury

Info

The word 'January' is misspelled 'Janaury' in the Employees disclosure stating the Sponsor's headcount.

“As of Janaury 31, 2024, our Sponsor had 85 full-time employees and no part-time employees.”
PPM p.7399% confidence

Spelling / typo — Mary 2014 until Mary 2015

Info

In Patrick Donoghue's management bio the month 'May' is misspelled 'Mary' twice ('from Mary 2014 until Mary 2015'); the same error is repeated verbatim where the bio is duplicated on page 107.

“Previously serving as Vice President of Wholesale Operations for ACC Mortgage from Mary 2014 until Mary 2015, Mr. Donoghue managed the entire loan process for a significant broker channel reviewing and funding private money loan transactions.”
PPM p.8498% confidence

Diligence gaps

Questions a standard diligence questionnaire would ask that the PPM leaves unanswered.

DDQ gap: Does the fund engage an independent auditor?

High

The offering documents don't answer a standard institutional DDQ question (Governance). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ gap: Does the fund have a GP clawback provision?

High

The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ gap: What is the LP/GP carried-interest split above the preferred return?

High

The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ gap: What is the preferred return (hurdle) rate offered to LPs?

High

The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ gap: Does the fund use a third-party fund administrator?

Medium

The offering documents don't answer a standard institutional DDQ question (Governance). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ gap: Is there a GP catch-up, and at what rate?

Medium

The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ gap: What distribution-waterfall structure does the fund use?

Medium

The offering documents don't answer a standard institutional DDQ question (Structure). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ gap: What is the GP's capital commitment (skin in the game)?

Medium

The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.

90% confidence

DDQ readiness

How much of a standard institutional due-diligence questionnaire this fund's offering documents answer out of the box. Gaps are questions an allocator will ask directly.

38%
Coverage
5 answered0 partial8 gaps13 questions
Economics
  • What is the preferred return (hurdle) rate offered to LPs?Gap
  • What is the LP/GP carried-interest split above the preferred return?Gap
  • Is there a GP catch-up, and at what rate?Gap
  • Does the fund have a GP clawback provision?Gap
  • What is the GP's capital commitment (skin in the game)?Gap
Structure
  • What distribution-waterfall structure does the fund use?Gap
  • What is the fund's investment strategy / asset class?UnknownAnswered
  • What is the fund's vintage year?Vintage 2014.Answered
  • What is the target offering size?Target offering of $75,000,000.Answered
  • What is the minimum LP investment?Minimum investment of $100.Answered
Fees & Expenses
  • Is the fund's fee schedule disclosed (management fee, etc.)?3 fee line item(s) extracted from the offering documents.Answered
Governance
  • Does the fund engage an independent auditor?Gap
  • Does the fund use a third-party fund administrator?Gap
Generate IC memo →

Fee scheduletaken before LP distributions

Total load 1.00%
Fee
Trigger
Basis
Rate
Management Fee
Ongoing quarterly, beginning after the Offering terminates
Annualized rate of 1.00% of the Aggregate Loan Amount (aggregate principal of all outstanding performing loans in portfolio), paid quarterly (one-fourth of 1.0% per quarter). Calculated at end of each quarterly period beginning with the last day of the calendar quarter in which the Offering terminates.
1.00%
Organization and Offering Expense Reimbursement
Ongoing during and after the Offering; reimbursed in monthly installments
Flat reimbursement of up to $105,000 (approx. $5,000 organizational costs + up to $100,000 legal fees). Monthly installments capped at 0.50% of aggregate gross offering proceeds.
0.00%
Special Servicing Expenses
Upon occurrence of non-performing asset requiring special servicing
Variable; reimbursement of actual expenses incurred by Manager for special servicing of non-performing assets. Manager has sole discretion to determine whether an asset is non-performing.
0.00%

Service providers3 gaps

Provider network →
Legal Counsel
Gap
Not disclosed
No independent counsel named for investors. Common in small syndications where Manager and Fund share counsel — reduces independence. Verify during diligence.
Auditor
Gap
Not disclosed
Audit intent not stated in PPM. Ask the sponsor: will the fund be audited, by whom, and on what frequency?
Fund Administrator
Gap
Not disclosed
No third-party fund administrator referenced. Manager likely handles admin internally — common for <$10M raises but reduces independence.
Placement Agent
OK
No placement agent engaged
No placement agent engaged. Direct placement by Manager — no placement fees eat your invested capital.

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