Podcast: Generating Yield With Direct Real Estate Lending

In this episode of Strategic Investor Radio, Money360 founder and CEO Evan Gentry joins host Charley Wright in the studio for a fascinating interview. Mr. Gentry’s firm is truly unique: It raises money through investors and then makes loans, secured by real estate, at higher interest rates than investors can generally expect to earn from somewhat similar mortgage REIT products. Moreover, Money360’s investors can select the exact properties that secure their loans, and they can make fractional loans – i.e., less than 100% of the total loan amount. This is great for diversification’s sake.

Gentry says Money360 began to “ramp up” about two years ago. Now the firm has grown its business to 20 employees, hundreds of investors, and it has made around $150 million in loans. Gentry says he and his team understand the lending side of the business very well, but they also understand investors and how to work with them – thus, both sides of the business are adequately covered.

Generating Attractive Yields

Money360 is a sort-of “hard money” lending concept, but not entirely. As stated earlier, the firm’s approach is similar to that of a mortgage-backed REIT, but while these REITs can be expected to generate returns of maybe 4-6% for investors, Gentry says Money360 loans typically earn 8-10%, or even more. Money360’s real estate borrowers were unable to secure traditional bank financing, which makes them a bit more risky, but Gentry says growing constraints on banks has made the non-bank lending market bigger and better, creating more opportunities for his firm. It should also be noted that all Money360 loans are secured by commercial or non-owner-occupied properties – i.e., not people’s homes.

Listen to the Episode

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Show Resources

Find more of Charley Wright’s interviews with leading alternative investment managers on our dedicated page for the Strategy Investor Radio show.