1 min read
Sources:
Form 1-A, Kevin's account, Form 1-SA
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Short answer
It is not guaranteed, and the filings say so; what exists is structure. No mortgage, so a price drop cannot trigger a foreclosure or margin call. A purchase discount, the wedge, meant to leave about 20% of equity at completion as a cushion. $16.3 million of liquid assets against a lean four-person overhead, with income from operations positive in the first half of 2026. And the real estate held at cost, so book value already understates what management believes it is worth. Against that, $38.6 million of bonds rank ahead of every shareholder. 123
Mortgage risk: None (no bank debt on any property)
Purchase cushion: ~20% target (the wedge, by Kevin's account)
Liquid assets: $16.3M (June 30, 2026)
Ahead of shareholders: $38.6M (convertible bonds)
Against falling values
No property carries a mortgage, so a decline in prices cannot trigger a mortgage default, because there is none; the bonds and other liabilities still have to be paid. Each property was bought below market with a target of about 20% equity after repairs, which is the cushion a decline eats before shareholders’ capital does. Real estate is carried at cost, so the balance sheet already sits below management’s view of value. 12
Against overhead
The company has three full-time and one part-time employees after a 2024 downsizing that outsourced construction, software and accounting. It held $16.3 million of cash, Treasuries and securities at June 30, 2026, and its operating business earned $539,484 before bond interest in the first half of 2026. Rent and membership revenue cover overhead; capital is not being burned on payroll. 3
What stands ahead of shareholders
$38.6 million of 5% convertible bonds, unsecured but senior to every class of stock. In a liquidation they are paid first. They convert to stock at $1.40 from 2027 if the valuation test is met, which would remove the claim. 3
The honest line
The offering circular states that an investor may lose the entire investment. The structure lowers the odds of a forced loss; it does not eliminate a market loss.
No lender, a a target purchase discount, and cash in the bank. None of it is a guarantee, and the bonds stand in front of the stock. 13
Simply put
✅ What protects the money
➡️ No lender holds a mortgage on the properties. The company does have $38.6 million of unsecured convertible bonds and other liabilities, and investors remain exposed to operating losses, creditor claims and the loss of their investment.
➡️ Each house was bought cheap enough to absorb a price drop.
➡️ $16 million of cash and Treasuries. Only four employees to pay.
✅ What does not
➡️ The bonds get paid before shareholders if things go wrong.
➡️ A deep enough downturn beats any cushion. The filing says you can lose it all.
Sources
Form 1-A, Business (no mortgage or bank debt); Risk Factors (loss of entire investment possible) Open the filing
Kevin's account, The thesis: “a target of 20% equity gains after repairs. That cushion protects against fluctuations in real estate values.” Read the excerpt
Form 1-SA, Liquidity and Capital Resources ($16,346,435 liquid assets); Note 6 ($38,612,004 bonds); MD&A (income from operations $539,484) Open the filing
