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Realized Deal : Performance Communities Fund

Sponsored By Performance Realty

Risk Profile
Amount Invested
Targeted IRR
Actual IRR*
Targeted Equity Multiple
Actual Equity Multiple*
Targeted Hold Period
10.0 years
Actual Hold Period
2.2 years

In November 2017, Performance Realty launched an offering for a workforce housing fund (the “Fund”) focused on mobile home parks and multifamily apartments.

The business plan contemplated acquiring, improving, managing, and selling residential housing, including mobile home parks, apartments, group housing, and other forms of rental residential income properties throughout the United States. For each acquired asset, Performance Realty planned to focus on revenue optimization, expense management, property enhancements, and sustainability and wellness.

Project Timeline

Fund’s Single Asset Exceeding Expectations

June 2018

As of Q2 2018, the Fund owned and operated a single asset, a mobile home park located in Oregon. The property results were exceeding projections due to significantly faster than projected occupancy growth. The asset’s occupancy had increased to 96% from 79% at acquisition.

Two New Acquisitions

September 2018

During the third quarter of 2018, the Fund acquired two additional mobile home parks, also in Oregon and located within 15 miles of the Fund’s first existing asset. Performance Realty believed the Fund’s existing property had provided key knowledge of the market and offered first-hand insight into the high demand for affordable housing within this region. Overall, the Fund continued to perform well making distributions to investors at an annualized rate of 8%. Due to strong performance, Performance Realty was also beginning to evaluate a potential refinancing of the Fund’s first asset.

Successful Sale

August 2020

Throughout 2019, the properties continued to perform well operationally and Performance Realty continued to evaluate various strategies for the Fund (i.e., looking at additional acquisitions, evaluating refinancing opportunities, analyzing unsolicited offers, etc.). Ultimately, Performance Realty determined it was in the best interest of investors to proceed with an early opportunistic exit. The three assets in the Fund were successfully sold in August 2020.

Final Outcome

Good business plan execution allowed Performance Realty to create safer, more attractive, and sustainable communities, which led to an opportunistic exit opportunity resulting in strong returns for investors, including a higher-than-projected IRR.

*Net of the most onerous fees charged to clients of CrowdStreet Advisors, LLC, our registered investment advisor subsidiary; an investor’s actual returns on a realized investment may differ.

This report contains explanations of a series of events associated with the Performance Communities Fund offering that resulted in an approximate 26% (net of most onerous fees) IRR to investors (including those from the CrowdStreet Marketplace). Certain aspects of the report such as dates of major events and the final outcome are easily verifiable while others, particularly underlying reasons behind the sponsor’s business plan execution, are not.

The report partially relies upon the sponsor’s explanations, the information contained within sponsor-produced quarterly reports, and conference calls. This analysis is not an assertion of independently verified facts but, rather, is for informational purposes only, to convey CrowdStreet’s understanding of what transpired.

CrowdStreet makes no representation or warranty, express or implied, in relation to the fairness, accuracy, correctness, completeness, or reliability of the information contained in this report. CrowdStreet does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this report or for any decision based on it.

This communication should not be construed nor is it intended to be a recommendation to purchase, sell or hold any security or otherwise to be investment, tax, financial, accounting, legal, regulatory or compliance advice. Furthermore, this communication does not establish an attorney-client relationship or constitute legal advice. Past performance is no guarantee of future results or success. Information on this page is based on information available to us as of the date of posting and CrowdStreet, nor its affiliates, represent that it is accurate, complete or up to date. Investors should consult with a financial advisor, attorney, accountant, and any other professional that can help in understanding and assessing the risks associated with any investment opportunity.