Property Geographic Area Details
California primary and secondary markets
8% to 8.5% Annually
Only 1st Liens
Average LTV for All Loans
Average Loan Term
Property Types and Loan Types
- Residential Property
- Commercial Property
- Residential Investment
- Assisted Living Facility
- Equity Cash Out
- Individual Accredited
- Ultra High Net Worth Investor
- Family Office
- Private Equity
- Hedge Fund
- Pension Fund
- Insurance Company
Most Loans Sold After Funding
Redemption Notice Period
July 11, 2011
Assets Under Management
Regulation D 506(c)
IRA Investment Option
Investments in loans on high-quality California real estate targeting preservation of capital and stable returns exceeding 8%
THE PORTFOLIO: DIVERSIFIED, HIGH-QUALITY LOANS
The Fund holds newly originated trust deeds (loans) and purchases existing mortgage notes, all secured by prime investment-grade real estate throughout California.
INVESTMENT OBJECTIVE: HIGHLY PREDICTABLE CASH FLOW WITH PRESERVATION OF CAPITAL
Monthly dividends that can be automatically reinvested to build total return, which is uncorrelated to the performance of the broad capital markets (such as stocks, bonds, gold, and other commodities).
TRACK RECORD: ANNUAL RETURNS OF 8% OR GREATER OVER THE PAST FIVE YEARS*
Backed by independently audited financial statements.
FUND MANAGEMENT: LENDING BEE, A TRUSTED NAME IN THE PRIVATE LENDING INDUSTRY
Lending Bee, Inc. is led by professionals with foremost expertise in the California private real estate lending markets.
STRONG ALIGNMENT OF INTERESTS BETWEEN FUND MANAGEMENT AND INVESTORS
The principals of the Fund Manager have invested over $2 million of their personal capital alongside Fund investors.
Investing for Strong, Steady, Return Secured by Quality Residential and Commercial Real Estate
The Fund originates, underwrites, and finances loan transactions on high-quality investment real estate properties. These transactions provide an attractive risk/return balance to investors in the Fund—who each personally own a fractional share of the Fund’s investments.
- PREDICTABLE MONTHLY DIVIDEND PAYMENTS: The Fund receives steady income in the form of loan interest paid by the borrowers. From this cash flow, the Fund distributes monthly dividends to investors.
- POTENTIAL FOR SUBSTANTIAL LONG-TERM ACCUMULATION: Investors have the option of receiving the dividends or having them automatically reinvested to take advantage of the power of compounding.
- THE SECURITY OF REAL ESTATE COLLATERAL OFFERS PRINCIPAL PROTECTION: In the event of a borrower default, the Fund Manager can foreclose on the property securing the loan. At that point, the property becomes part of the Fund’s portfolio. This offers investors the highest degree of principal protection.
- NO CORRELATION: There is no direct correlation of the cash flow from the loan payments (or the value of the real estate collateral) to the performance of the stock or bond markets.
- LIQUIDITY: There is a strong secondary market for loans, which are constantly in high demand from individuals, institutions, and hedge funds. Therefore, the Fund can typically honor redemption requests.
With a Favorable Sharing Arrangement: 8% Preferred Return for Investors
It is anticipated that investors will receive an 8%-to-10% return in investment each year.* Furthermore, when it comes to receiving distributions of cash flow, the Fund’s sharing arrangement gives priority to investors over the Fund Manager. The Fund Manager receives no Profit Sharing until investors have received their 8% Preferred Return.
Maintaining a Well-Diversified Portfolio
The Fund’s loan portfolio has been diversified over many different borrowers, properties, and geographic regions of the state. Also, to further protect the Fund from a potential downturn in any particular market sector, the Fund Manager strives to keep the Fund’s collateral real estate well diversified by property type and use.
- RESIDENTIAL (1 to 4 units)
- MULTI-FAMILY HOUSING
Taking a Proactive Approach to Risk Control
In addition to keeping the portfolio diversified, the Fund takes a number of other important, prudent steps to reduce risk and protect capital.
Potential loan transactions are carefully vetted by our team of seasoned real estate and lending professionals.
We invest where our expertise is—California. Here’s where we know the demographics, the regulations, the real estate investors and agents, and the regional markets down to the individual properties and their “highest and best use.”
“BUSINESS PURPOSE” LOANS ONLY
We lend on properties that are either generating rental income or are poised for some significant commercial purpose.
The Fund maintains title insurance on each property with coverage of 125% of the loan amount, as well as hazard insurance when appropriate.
PRUDENT LOAN-TO-VALUE RATIOS: A Built-in Margin of Safety
- Collateral Value in Excess of Loan: At least 30% of Property Value
So even if property value were to decrease by 30% the loan principal is still completely protected.
- Maximum Loan Amount: 70% of Property Value
The average loan-to-value ratio of the portfolio is under 55%. The Fund will only loan up to 70% of a property’s value.
In case of a foreclosure, the property becomes an asset of the Fund and any rental income collected is distributed to investors. Any extra profit from the sale of the asset is distributed 50%/50% to investors and the Fund Manager.
Ideal for a Wide Range of Investors
The Fund is available to Accredited Investors (as per Regulation D under the Securities Act) who fit any of the following profiles:
- INVESTORS SEEKING PORTFOLIO DIVERSIFICATION: The Fund’s steady, low-risk return has no direct correlation to stocks, bonds, or commodities.
- OR, TOTAL RETURN: With monthly dividends reinvested, the Fund can serve as a near- or long-term vehicle for capital accumulation.
- OR, MONTHLY INCOME: An investor in the fund can opt to receive the monthly distributions rather than have them automatically reinvested.
- INVESTORS FUNDING A SELF-DIRECTED RETIREMENT PLAN: The Fund is approved for investment by self-directed 401(k) plans and IRAs. Plan holders can transfer their 401(k) or IRA into an LBC Capital self-directed IRA—an investment that has proven more profitable than bonds and safer and less volatile than stocks.
- INVESTORS WHO LIKE REAL ESTATE: With real estate probably near the top of its market cycle, it may be preferable to own loans rather than the real estate itself.
- MONEY MANAGERS, RIAS, FAMILY OFFICES: Financial professionals seeking diversification, robust returns, and capital preservation for their investor-clients.
A Trusted Name in the Private Lending Industry
The Fund Manager, Lending Bee, Inc., is known for providing investment opportunities for private and institutional investors through its expertise in private mortgage pooling.
FOUNDED IN 2003
Lending Bee began operations in 2003 as a small Los Angeles-based full-service mortgage firm.
TODAY, A LEADER
Over the years, Lending Bee has developed into a leading provider of regional real estate services and loan delivery—private mortgage funds, quality hard money loans, private financing, and private mortgage pools. For our investors, we focus on strong annual returns with safety secured by the highest quality investment-grade real estate.
A NETWORK OF TRUSTED RELATIONSHIPS
We tap into our established relationships with real estate entrepreneurs, realtors, and mortgage brokers to deploy Fund capital quickly and efficiently across all cycles of the real estate market.
Fund Facts and Terms
- The Fund: LBC Capital Income Fund, LLC—a California limited liability company.
- Fund Manager: Lending Bee, Inc., a California corporation.
- Maximum Fund Size: $100,000,000. The Fund’s capitalization is currently (as of 5/31/2017) $17,000,000.
- Minimum Investment: $100,000, subject to the discretion of the Manager.
- The Term of the Fund: Until December 31, 2024, subject to a 5-year extension at the Manager’s sole discretion and further extension by vote of the members. The Manager may terminate the Fund earlier.
- Fees: Asset Management Fee is 2.5%. The Manager reserves the right to adjust the fee based on market conditions and certain costs. An investor investing over one million dollars in the Fund shall receive a rebate of 0.5% at the year end.
- Preferred Return: Each year, investors received 100% of distributions until they have received an 8% Preferred Return (cumulative, non-compounded).
- Liquidity: An investor in the Fund may withdraw from the Fund at any time; however, the right to sell Fund shares and realize a return of capital is available under limited circumstances until the termination of the Fund.**
**The Fund will use its best efforts to redeem shares for investors who (1) have held the shares for at least 12 months, and (2) have made the request for redemption in writing by certified mail with two-to-four weeks’ notice.
Interests in LBC Capital Income Fund, LLC are available only to accredited investors who meet certain minimum annual income or net worth thresholds. Interests are being offered in reliance on an exemption from the registration requirements of the Securities Act and are not required to comply with specific disclosure requirements that apply to registration under the Securities Act. The Securities and Exchange Commission has not passed upon the merits of or given its approval to the Interests, the terms of the offering, or the accuracy or completeness of any offering materials. Interests are subject to legal restrictions on transfer and resale and investors should not assume they will be able to resell their Interests. Investing in Interests involves risk, and investors should be able to bear the loss of their investment.
This advertisement does not constitute an offer to sell or a solicitation of an offer to buy interests in the Fund. No such offer or solicitation will be made prior to the delivery of a definitive offering memorandum and other materials relating to the matters herein. Before making an investment decision with respect to the Fund, potential investors are advised to read carefully the offering memorandum and the related subscription documents, and to consult with their tax, legal, and financial advisors. This brochure may contain a preliminary summary of the purpose and principal business terms of the Fund; this summary does not purport to be complete and is qualified in its entirety by reference to the more detailed discussions contained in the private offering memorandum. This brochure and the information contained herein may not be reproduced in whole or part, and may not be delivered to any person without the consent of LBC Capital Income Fund, LLC.
Interests in the Fund are not FDIC insured and carry a risk of loss of principal