What is an LRO and what am I actually investing in?
Last Updated: Jul 17, 2019 11:20AM EDT
GROUNDFLOOR is a unique platform that allows everyday investors to invest fractionally in real estate projects happening around the country. In a few words, GROUNDFLOOR pre-funds loans to real estate developers, then works with the U.S. Securities & Exchange Commission (SEC) to convert these loans into securities that are then sold to investors.
When you invest with GROUNDFLOOR, you are investing in a Limited Recourse Obligation (LRO), which is a debt security that GROUNDFLOOR submits to the SEC for qualification on our platform. GROUNDFLOOR holds a first lien position on each loan, and each loan is backed by the underlying real estate asset(s).
You choose which projects to invest in and how much to invest in each project. The LRO you are buying corresponds to the project that you have chosen to fund. Each LRO's performance is determined by the performance of the borrower's loan, and each LRO will be repaid to investors from the cash the borrower uses to repay the loan.
A loan may have its own LRO or be part of a series of LROs. For LROs that are part of a series, an individual LRO within the series may have either a senior or junior lien position. Please refer to the Financial Details and the Project Specific Risk factors on the Loan Detail page for information on LRO specific lien position.
In addition to the Loan Detail page, you can always consult our offering circular for complete details on individual LROs.
Some statements in the offering circulars/PQAs and on this website may contain forward-looking statements and are based upon current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Although Groundfloor believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, actual results and performance could differ materially from those set forth in the forward-looking statements. You should consult with your own attorneys, accountants, and other professional advisors prior to making an investment.
The information on this website does not constitute an offer to sell or a solicitation of interest in any LROs that may be qualified in the future. No money or other consideration is being solicited with respect to any LROs that have not been duly qualified, and if sent in response, will not be accepted. No offer to buy any LROs that have not been duly qualified can be accepted and no part of the purchase price can be received until an offering circular/PQA covering such LROs has been qualified by the SEC. Any such offer to buy unqualified LROs may be withdrawn or revoked, without obligation of any kind, at any time before notice of its acceptance is given after the date of qualification. An indication of interest in our offerings involves no obligation or commitment of any kind.
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Neither the SEC nor any state securities commission or regulatory authority approved, disapproved, endorsed, or recommended the merits of the offering described in the offering circulars/PQAs or reflected on this website.
Groundfloor’s services do not constitute “crowdfunding” as described in Title III of the Jumpstart Our Business Startups Act (“JOBS Act”).