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253G2 1 tv523881_253g2.htm 253G2 Filed Pursuant to Rule 253(g)(2) File No. 024-10492 As submitted to the Securities and Exchange Commission on June 27, 2019 OFFERING CIRCULAR Fundrise Real Estate Investment Trust, LLC (the “Income eREIT ® ”) Sponsored by Rise Companies Corp. Up to $19,736,404 in Common Shares Fundrise Real Estate Investment Trust, LLC is a Delaware limited liability company formed to originate, invest in and manage a diversified portfolio of commercial real estate investments. Through May 27, 2019 our ongoing offering has raised approximately $116.4 million in capital. We have used, and continue to expect to use substantially all of the net proceeds from our offerings to originate, acquire and structure commercial real estate loans (including senior mortgage loans, subordinated mortgage loans (also referred to as B-Notes), mezzanine loans, and participations in such loans) and investments in commercial real estate. We may also invest in commercial real estate-related debt securities (including commercial mortgage-backed securities, or CMBS, collateralized debt obligations, or CDOs, and REIT senior unsecured debt) and other real estate-related assets. We are externally managed by Fundrise Advisors, LLC, or our Manager, which is an investment adviser registered with the Securities and Exchange Commission, or SEC, and a wholly-owned subsidiary of our sponsor, Rise Companies Corp., the parent company of Fundrise, LLC, our affiliate. Registration with the SEC does not imply a certain level of skill or training. Fundrise, LLC owns and operates an online investment platform www.fundrise.com (the “Fundrise Platform”) that allows investors to become equity or debt holders in real estate opportunities that may have been historically difficult to access for some investors. Through the use of the Fundrise Platform, investors can browse and screen real estate investments, view details of an investment and sign legal documents online. We elected to be treated as a real estate investment trust, or REIT, for U.S. federal income tax purposes beginning with our taxable year ended December 31, 2015. We are continuing to offer up to $ 19,736,404 in our common shares, which represents the value of the shares available to be offered as of May 27, 2019 out of the rolling 12-month maximum offering amount of $50 million in our common shares. The minimum investment in our common shares for initial purchases is 100 shares, or $1,000 based on the current $10.00 per share price. However, in certain instances, we may revise the minimum purchase requirements in the future or elect to waive the minimum purchase requirement, such as for individuals who participate in different plans established by our Manager through which they can invest in our common shares. We expect to offer common shares in this offering until we raise the maximum amount being offered, unless terminated by our Manager at an earlier time. The per share purchase price for our common shares is currently $10.00 per share. The per share purchase price in this offering will be adjusted at the beginning of every fiscal quarter (or as soon as commercially reasonable thereafter), and will equal the greater of (i) $10.00 per share or (ii) the sum of our net asset value, or NAV, divided by the number of our common shares outstanding as of the end of the prior fiscal quarter (“NAV per share”). Investors will pay the most recent publicly announced purchase price as of the date of their subscription. Although we do not intend to list our common shares for trading on a stock exchange or other trading market, we have adopted a redemption plan designed to provide our shareholders with limited liquidity on an ongoing basis for their investment in our shares. We intend to continue to distribute our shares primarily through the Fundrise Platform.

Fundrise Real Estate Investment Trust, LLC (the “Income eREIT · Registration with the SEC does not imply a certain level of skill or training. Fundrise, LLC owns and operates an

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  • 253G21tv523881_253g2.htm253G2

    FiledPursuanttoRule253(g)(2)FileNo.024-10492

    AssubmittedtotheSecuritiesandExchangeCommissiononJune27,2019

    OFFERINGCIRCULAR

    FundriseRealEstateInvestmentTrust,LLC(the“IncomeeREIT®”)

    SponsoredbyRiseCompaniesCorp.

    Upto$19,736,404inCommonShares

    FundriseRealEstateInvestmentTrust,LLCisaDelawarelimitedliabilitycompanyformedtooriginate,investinandmanage

    adiversifiedportfolioofcommercialrealestateinvestments.ThroughMay27,2019ourongoingofferinghasraisedapproximately$116.4millionincapital.Wehaveused,andcontinuetoexpecttousesubstantiallyallofthenetproceedsfromourofferingstooriginate,acquireandstructurecommercialrealestateloans(includingseniormortgageloans,subordinatedmortgageloans(alsoreferredtoasB-Notes),mezzanineloans,andparticipationsinsuchloans)andinvestmentsincommercialrealestate.Wemayalsoinvestincommercialrealestate-relateddebtsecurities(includingcommercialmortgage-backedsecurities,orCMBS,collateralizeddebtobligations,orCDOs,andREITseniorunsecureddebt)andotherrealestate-relatedassets.

    WeareexternallymanagedbyFundriseAdvisors,LLC,orourManager,whichisaninvestmentadviserregisteredwiththe

    SecuritiesandExchangeCommission,orSEC,andawholly-ownedsubsidiaryofoursponsor,RiseCompaniesCorp.,theparentcompanyofFundrise,LLC,ouraffiliate.RegistrationwiththeSECdoesnotimplyacertainlevelofskillortraining.Fundrise,LLCownsandoperatesanonlineinvestmentplatformwww.fundrise.com(the“FundrisePlatform”)thatallowsinvestorstobecomeequityordebtholdersinrealestateopportunitiesthatmayhavebeenhistoricallydifficulttoaccessforsomeinvestors.ThroughtheuseoftheFundrisePlatform,investorscanbrowseandscreenrealestateinvestments,viewdetailsofaninvestmentandsignlegaldocumentsonline.Weelectedtobetreatedasarealestateinvestmenttrust,orREIT,forU.S.federalincometaxpurposesbeginningwithourtaxableyearendedDecember31,2015.

    Wearecontinuingtoofferupto$19,736,404inourcommonshares,whichrepresentsthevalueofthesharesavailabletobe

    offeredasofMay27,2019outoftherolling12-monthmaximumofferingamountof$50millioninourcommonshares.Theminimuminvestmentinourcommonsharesforinitialpurchasesis100shares,or$1,000basedonthecurrent$10.00pershareprice.However,incertaininstances,wemayrevisetheminimumpurchaserequirementsinthefutureorelecttowaivetheminimumpurchaserequirement,suchasforindividualswhoparticipateindifferentplansestablishedbyourManagerthroughwhichtheycaninvestinourcommonshares.Weexpecttooffercommonsharesinthisofferinguntilweraisethemaximumamountbeingoffered,unlessterminatedbyourManageratanearliertime.Thepersharepurchasepriceforourcommonsharesiscurrently$10.00pershare.Thepersharepurchasepriceinthisofferingwillbeadjustedatthebeginningofeveryfiscalquarter(orassoonascommerciallyreasonablethereafter),andwillequalthegreaterof(i)$10.00pershareor(ii)thesumofournetassetvalue,orNAV,dividedbythenumberofourcommonsharesoutstandingasoftheendofthepriorfiscalquarter(“NAVpershare”).Investorswillpaythemostrecentpubliclyannouncedpurchasepriceasofthedateoftheirsubscription.Althoughwedonotintendtolistourcommonsharesfortradingonastockexchangeorothertradingmarket,wehaveadoptedaredemptionplandesignedtoprovideourshareholderswithlimitedliquidityonanongoingbasisfortheirinvestmentinourshares.

    WeintendtocontinuetodistributeoursharesprimarilythroughtheFundrisePlatform.

  • Investinginourcommonsharesisspeculativeandinvolvessubstantialrisks.Youshouldpurchasethesesecuritiesonly

    ifyoucanaffordacompletelossofyourinvestment.See“RiskFactors”beginningonpage26toreadaboutthemoresignificantrisksyoushouldconsiderbeforebuyingourcommonshares.Theserisksincludethefollowing:

    · WedependonourManagertoselectourinvestmentsandconductouroperations.WepayfeesandexpensestoourManager

    anditsaffiliatesthatwerenotdeterminedonanarm’slengthbasis,andthereforewedonothavethebenefitofarm’slengthnegotiationsofthetypenormallyconductedbetweenunrelatedparties.Thesefeesincreaseyourriskofloss.

    · Wehavealimitedoperatinghistory.Ourpriorperformancemaynotpredictourfutureresults.Therefore,thereisnoassurance

    thatwewillachieveourinvestmentobjectives. · OurManager’sexecutiveofficers,andkeyrealestateanddebtfinanceprofessionalsarealsoofficers,directors,managers

    and/orkeyprofessionalsofoursponsoranditsaffiliates.Asaresult,theyfaceconflictsofinterest,includingtimeconstraints,allocationofinvestmentopportunitiesandsignificantconflictscreatedbyourManager’scompensationarrangementswithusandotheraffiliatesofoursponsor.

    · Oursponsorhassponsoredandmayinthefuturesponsorothercompaniesthatcompetewithus,andoursponsordoesnothaveanexclusivemanagementarrangementwithus;however,oursponsorhasadoptedapolicyforallocatinginvestmentsbetweendifferentcompaniesthatitsponsorswithsimilarinvestmentstrategies.

    · ThisofferingisbeingmadepursuanttorecentlyadoptedrulesandregulationsunderRegulationAoftheSecuritiesActof

    1933,asamended,ortheSecuritiesAct.Thelegalandcompliancerequirementsoftheserulesandregulations,includingongoingreportingrequirementsrelatedthereto,arerelativelyuntested.

    · Ifweinternalizeourmanagementfunctions,yourinterestinuscouldbedilutedandwecouldincurothersignificantcosts

    associatedwithbeingself-managed. · Wemaychangeourinvestmentguidelineswithoutshareholderconsent,whichcouldresultininvestmentsthataredifferent

    fromthosedescribedinthisofferingcircular. · Althoughourdistributionpolicyistouseourcashflowfromoperationstomakedistributions,ourorganizationaldocuments

    permitustopaydistributionsfromanysource,includingofferingproceeds,borrowingsorsalesofassets.Wehavenotestablishedalimitontheamountofproceedswemayusetofunddistributions.Ifwepaydistributionsfromsourcesotherthanourcashflowfromoperations,wewillhavelessfundsavailableforinvestmentsandyouroverallreturnmaybereduced.Inanyevent,weintendtomakeannualdistributionsasrequiredtocomplywithREITdistributionrequirementsandavoidU.S.federalincomeandexcisetaxesonretainedincome.

    · Oursponsor’sinternalaccountantsandassetmanagementteamcalculatesourNAVonaquarterlybasisusingvaluation

    methodologiesthatinvolvesubjectivejudgmentsandestimates.Asaresult,ourNAVmaynotaccuratelyreflecttheactualpricesatwhichourcommercialrealestateassetsandinvestments,includingrelatedliabilities,couldbeliquidatedonanygivenday.

    · OuroperatingagreementdoesnotrequireourManagertoseekshareholderapprovaltoliquidateourassetsbyaspecifieddate,

    nordoesouroperatingagreementrequireourManagertolistoursharesfortradingbyaspecifieddate.Nopublicmarketcurrentlyexistsforourshares.Untiloursharesarelisted,ifever,youmaynotsellyourshares.Ifyouareabletosellyourshares,youmayhavetosellthematasubstantialloss.

    · IfwefailtoqualifyasaREITforU.S.federalincometaxpurposesandnoreliefprovisionsapply,wewouldbesubjectto

    entity-levelU.S.federalcorporateincometaxand,asaresult,ourcashavailablefordistributiontoourshareholdersandthevalueofoursharescouldmateriallydecrease.

  • · Realestateinvestmentsaresubjecttogeneraldownturnsintheindustryaswellasdownturnsinspecificgeographicareas.We

    cannotpredictwhattheoccupancylevelwillbeinaparticularbuildingorthatanytenantormortgageorotherrealestate-relatedloanborrowerwillremainsolvent.Accordingly,wecannotguaranteethatyouwillreceivecashdistributionsorappreciationofyourinvestment.

    · Ourinvestmentsincommercialrealestateandotherselectrealestate-relatedassetsaresubjecttorisksrelatingtothevolatility

    inthevalueoftheunderlyingrealestate,defaultonunderlyingincomestreams,fluctuationsininterestrates,andotherrisksassociatedwithdebt,andrealestateinvestmentgenerally.Theseinvestmentsareonlysuitableforsophisticatedinvestorswithahigh-riskinvestmentprofile.TheUnitedStatesSecuritiesandExchangeCommissiondoesnotpassuponthemeritsoforgiveitsapprovaltoany

    securitiesofferedorthetermsoftheoffering,nordoesitpassupontheaccuracyorcompletenessofanyofferingcircularorothersolicitationmaterials.ThesesecuritiesareofferedpursuanttoanexemptionfromregistrationwiththeCommission;however,theCommissionhasnotmadeanindependentdeterminationthatthesecuritiesofferedareexemptfromregistration.

    Theuseofprojectionsorforecastsinthisofferingisprohibited.Nooneispermittedtomakeanyoralorwritten

    predictionsaboutthecashbenefitsortaxconsequencesyouwillreceivefromyourinvestmentinourcommonshares.

    PerShare Total

    Maximum PublicOfferingPrice(1) $ 10.00 $ 19,736,404UnderwritingDiscountsandCommissions(2) $ — $ —ProceedstoUsfromthisOfferingtothePublic(BeforeExpenses) $ 10.00 $ 19,736,404

    (1) Thepricepersharewillbeadjustedeveryfiscalquarterandwillbebasedonthegreaterof(i)$10.00pershareor(ii)thesumofournetassetvalue,orNAV,dividedbythenumberofourcommonsharesoutstandingasoftheendofthepriorfiscalquarter(NAVpershare).Thisisa“bestefforts”offering.

    (2) Investorsdonotpayupfrontsellingcommissionsinconnectionwiththepurchaseofourcommonshares.Wewillreimburse

    ourManagerforadditionalofferingcosts,whichareexpectedtobeapproximately$45,000.Reimbursementpaymentsaremadeinmonthlyinstallments,buttheaggregatemonthlyamountreimbursedcanneverexceed0.50%oftheaggregategrossofferingproceedsfromourofferings.Ifthesumofthetotalunreimbursedamountofsuchofferingcosts,plusnewcostsincurredsincethelastreimbursementpayment,exceedsthereimbursementlimitdescribedabovefortheapplicablemonthlyinstallment,theexcesswillbeeligibleforreimbursementinsubsequentmonths(subjecttothe0.50%limit),calculatedonanaccumulatedbasis,untilourManagerhasbeenreimbursedinfull.AsofDecember31,2018,approximately$1,006,000inorganizationalandofferingcostshavebeenincurredbyandreimbursedtoourManagerinconnectionwithourofferings.

    See“ManagementCompensation”foradescriptionofadditionalfeesandexpensesthatwewillpayourManager.WewillofferourcommonsharesonabesteffortsbasisthroughtheonlineFundrisePlatform.NeitherFundrise,LLCnoranyotheraffiliatedentityinvolvedintheofferandsaleofthesharesbeingofferedherebyisamemberfirmoftheFinancialIndustryRegulatoryAuthority,Inc.,orFINRA,andnopersonassociatedwithuswillbedeemedtobeabrokersolelybyreasonofhisorherparticipationinthesaleofourcommonshares.Generally,nosalemaybemadetoyouinthisofferingiftheaggregatepurchasepriceyoupayismorethan10%ofthe

    greaterofyourannualincomeornetworth.Differentrulesapplytoaccreditedinvestorsandnon-naturalpersons.Beforemakinganyrepresentationthatyourinvestmentdoesnotexceedapplicablethresholds,weencourageyoutoreviewRule251(d)(2)(i)(C)ofRegulationA.Forgeneralinformationoninvesting,weencourageyoutorefertowww.investor.gov.

    ThisofferingcircularfollowstheFormS-11disclosureformat.

    ThedateofthisofferingcircularisJune7,2019

  • IMPORTANTINFORMATIONABOUTTHISOFFERINGCIRCULAR

    Pleasecarefullyreadtheinformationinthisofferingcircularandanyaccompanyingofferingcircularsupplements,whichwe

    refertocollectivelyastheofferingcircular.Youshouldrelyonlyontheinformationcontainedinthisofferingcircular.Wehavenotauthorizedanyonetoprovideyouwithdifferentinformation.Thisofferingcircularmayonlybeusedwhereitislegaltosellthesesecurities.Youshouldnotassumethattheinformationcontainedinthisofferingcircularisaccurateasofanydatelaterthanthedatehereoforsuchotherdatesasarestatedhereinorasoftherespectivedatesofanydocumentsorotherinformationincorporatedhereinbyreference.

    ThisofferingcircularispartofanofferingstatementthatwefiledwiththeSEC,usingacontinuousofferingprocess.

    Periodically,aswemakematerialinvestments,updateourquarterlyNAVpershareamount,orhaveothermaterialdevelopments,wewillprovideanofferingcircularsupplementthatmayadd,updateorchangeinformationcontainedinthisofferingcircular.Anystatementthatwemakeinthisofferingcircularwillbemodifiedorsupersededbyanyinconsistentstatementmadebyusinasubsequentofferingcircularsupplement.TheofferingstatementwefiledwiththeSECincludesexhibitsthatprovidemoredetaileddescriptionsofthemattersdiscussedinthisofferingcircular.YoushouldreadthisofferingcircularandtherelatedexhibitsfiledwiththeSECandanyofferingcircularsupplement,togetherwithadditionalinformationcontainedinourannualreports,semi-annualreportsandotherreportsandinformationstatementsthatwewillfileperiodicallywiththeSEC.Seethesectionentitled“AdditionalInformation”belowformoredetails.

    TheofferingstatementandallsupplementsandreportsthatwehavefiledorwillfileinthefuturecanbereadattheSEC

    website,www.sec.gov,orontheFundrisePlatformwebsite,www.fundrise.com.ThecontentsoftheFundrisePlatformwebsite(otherthantheofferingstatement,thisofferingcircularandtheappendicesandexhibitsthereto)arenotincorporatedbyreferenceinorotherwiseapartofthisofferingcircular.

    Oursponsorandthosesellingsharesonourbehalfinthisofferingarepermittedtomakeadeterminationthatthepurchasersof

    sharesinthisofferingare“qualifiedpurchasers”inrelianceontheinformationandrepresentationsprovidedbytheshareholderregardingtheshareholder’sfinancialsituation.Beforemakinganyrepresentationthatyourinvestmentdoesnotexceedapplicablethresholds,weencourageyoutoreviewRule251(d)(2)(i)(C)ofRegulationA.Forgeneralinformationoninvesting,weencourageyoutorefertowww.investor.gov.

    i

  • TABLEOFCONTENTS

    IMPORTANTINFORMATIONABOUTTHISOFFERINGCIRCULAR iSTATELAWEXEMPTIONANDPURCHASERESTRICTIONS iiiQUESTIONSANDANSWERSABOUTTHISOFFERING 1OFFERINGSUMMARY 12RISKFACTORS 26STATEMENTSREGARDINGFORWARD-LOOKINGINFORMATION 61ESTIMATEDUSEOFPROCEEDS 63MANAGEMENT 64MANAGEMENTCOMPENSATION 70PRINCIPALSHAREHOLDERS 72CONFLICTSOFINTEREST 73INVESTMENTOBJECTIVESANDSTRATEGY 79PLANOFOPERATION 95DESCRIPTIONOFOURCOMMONSHARES 107U.S.FEDERALINCOMETAXCONSIDERATIONS 125ERISACONSIDERATIONS 147PLANOFDISTRIBUTION 150HOWTOSUBSCRIBE 152LEGALMATTERS 153EXPERTS 153ADDITIONALINFORMATION 154INDEXTOFINANCIALSTATEMENTSOFFUNDRISEREALESTATEINVESTMENTTRUST,LLC F-1APPENDIXA:FORMOFSUBSCRIPTIONAGREEMENT A-1

    ii

  • STATELAWEXEMPTIONANDPURCHASERESTRICTIONS

    Ourcommonsharesarebeingofferedandsoldonlyto“qualifiedpurchasers”(asdefinedinRegulationA).AsaTier2offering

    pursuanttoRegulationA,thisofferingwillbeexemptfromstatelaw“BlueSky”review,subjecttomeetingcertainstatefilingrequirementsandcomplyingwithcertainanti-fraudprovisions,totheextentthatourcommonsharesofferedherebyareofferedandsoldonlyto“qualifiedpurchasers”oratatimewhenourcommonsharesarelistedonanationalsecuritiesexchange.“Qualifiedpurchasers”include:(i)“accreditedinvestors”underRule501(a)ofRegulationDand(ii)allotherinvestorssolongastheirinvestmentinourcommonsharesdoesnotrepresentmorethan10%ofthegreateroftheirannualincomeornetworth(fornaturalpersons),or10%ofthegreaterofannualrevenueornetassetsatfiscalyear-end(fornon-naturalpersons).However,ourcommonsharesarebeingofferedandsoldonlytothoseinvestorsthatarewithinthelattercategory(i.e.,investorswhoseinvestmentinourcommonsharesdoesnotrepresentmorethan10%oftheapplicableamount),regardlessofaninvestor’sstatusasan“accreditedinvestor”.Accordingly,wereservetherighttorejectanyinvestor’ssubscriptioninwholeorinpartforanyreason,includingifwedetermineinoursoleandabsolutediscretionthatsuchinvestorisnota“qualifiedpurchaser”forpurposesofRegulationA.

    Todeterminewhetherapotentialinvestorisan“accreditedinvestor”forpurposesofsatisfyingoneofthetestsinthe“qualified

    purchaser”definition,theinvestormustbeanaturalpersonwhohas:

    1. anindividualnetworth,orjointnetworthwiththeperson’sspouse,thatexceeds$1,000,000atthetimeofthepurchase,excludingthevalueoftheprimaryresidenceofsuchperson;or

    2. earnedincomeexceeding$200,000ineachofthetwomostrecentyearsorjointincomewithaspouseexceeding$300,000for

    thoseyearsandareasonableexpectationofthesameincomelevelinthecurrentyear.

    Iftheinvestorisnotanaturalperson,differentstandardsapply.SeeRule501ofRegulationDformoredetails.Forpurposesofdeterminingwhetherapotentialinvestorisa“qualifiedpurchaser”,annualincomeandnetworthshouldbe

    calculatedasprovidedinthe“accreditedinvestor”definitionunderRule501ofRegulationD.Inparticular,networthinallcasesshouldbecalculatedexcludingthevalueofaninvestor’shome,homefurnishingsandautomobiles.

    iii

  • QUESTIONSANDANSWERSABOUTTHISOFFERING

    Thefollowingquestionsandanswersaboutthisofferinghighlightmaterialinformationregardingusandthisofferingthatis

    nototherwiseaddressedinthe“OfferingSummary”sectionofthisofferingcircular.Youshouldreadthisentireofferingcircular,includingthesectionentitled“RiskFactors”,beforedecidingtopurchaseourcommonshares.

    Q: WhatisFundriseRealEstateInvestmentTrust,LLC? A: WewereorganizedasaDelawarelimitedliabilitycompanytooriginate,investinandmanageadiversifiedportfolioofcommercial

    realestateloansandinvestmentsincommercialrealestate.Wemayalsoinvestincommercialrealestate-relateddebtsecuritiesandotherrealestate-relatedassets.Theuseoftheterms“FundriseRealEstateInvestmentTrust”,the“company”,the“IncomeeREIT®”,“we”,“us”or“our”inthisofferingcircularrefertoFundriseRealEstateInvestmentTrust,LLCunlessthecontextindicatesotherwise.

    Q: Howmuchhaveyouraisedinyouroffering? A: AsofMay27,2019,wehaveraisedapproximately$116.4millioninourongoingoffering(notincludingtheapproximate$1.2

    millionreceivedinprivateplacementstooursponsor,RiseCompaniesCorp.,andFundrise,LP,anaffiliateofoursponsor). Q: Whatpercentageoftheproceedsfromyourinitialofferinghaveyouinvested? A: AsofMay27,2019,theCompanyhasinvestedorcommittedtoinvestdebtorequity,includingcommitmentsnotfullydrawn

    down,butnotnecessarilyobligatedtobefunded,ofapproximately87%ofthenetproceedsraised.Inordertostructurecashdeploymentandpotentiallyimproverisk-adjustedreturns,theCompanymayfromtime-to-timemakecommitmentsinexcessoftheproceedsraisedinouroffering.TheCompanybelievesthatpayoffsandrefinancingofcurrentinvestmentsofdebtandequityoutstanding,linesofcredit,continuedcapitalraising,fundingcommitmentsnotultimatelydrawnupon,andotherpotentialcashdeploymentsolutions,willcontinuetoallowittosatisfyallofitsfundingcommitmentsinthefuture.

    Q: Whatisarealestateinvestmenttrust,orREIT? A: Ingeneral,aREITisanentitythat: ·combinesthecapitalofmanyinvestorstoacquireorprovidefinancingforadiversifiedportfolioofrealestateinvestmentsunder

    professionalmanagement; ·isabletoqualifyasa“realestateinvestmenttrust”undertheInternalRevenueCodeof1986,asamended,theCode,forU.S.

    federalincometaxpurposesandisthereforegenerallyentitledtoadeductionforthedividendsitpaysandnotsubjecttoU.S.federalcorporateincometaxesonitsnetincomethatisdistributedtoitsshareholders.Thistreatmentsubstantiallyeliminatesthe“doubletaxation”(taxationatboththecorporateandshareholderlevels)thatgenerallyresultsfrominvestmentsinacorporation;and

    ·generallypaysdistributionstoinvestorsofatleast90%ofitsannualordinarytaxableincome. Inthisofferingcircular,werefertoanentitythatqualifiestobetaxedasarealestateinvestmenttrustforU.S.federalincometax

    purposesasaREIT.WeelectedtobetreatedasaREITforU.S.federalincometaxpurposescommencingwithourtaxableyearendedDecember31,2015.

    Q: WhatisaneREIT®? A: An“eREIT®”isatypeofrealestateinvestmenttrustsponsoredbyRiseCompaniesCorp.,oursponsor,andoffereddirectlyto

    investorsonlineontheFundrisePlatform,withoutanybrokersorsellingcommissions.EacheREIT®intendstoinvestinadiversifiedpoolofcommercialrealestateassets,suchasapartments,hotels,shoppingcenters,andofficebuildingsfromacrossthecountry.

    Q: Whochooseswhichinvestmentsyoumake? A: WeareexternallymanagedbyFundriseAdvisors,LLC,orourManager,aninvestmentadviserregisteredwiththe

  • SEC.RegistrationwiththeSECdoesnotimplyacertainlevelofskillortraining.OurManagermakesallofourinvestmentdecisions.

    Q: WhoisRiseCompaniesCorp.? A: RiseCompaniesCorp.,oursponsorandtheparentcompanyofourManager,isalsotheparentcompanyofFundrise,LLC,our

    affiliate.Fundrise,LLCownsandoperatesanonlineinvestmentplatformwww.fundrise.com(the“FundrisePlatform”). Q: WhatistheFundrisePlatform? A: TheFundrisePlatformisanonlineinvestmentplatformforcommercialrealestate.Fundrisegivesinvestorstheabilityto:

    1

  • ·browseinvestmentofferingsbasedoninvestmentpreferencesincludinglocation,assettype,riskandreturnprofile; ·transactentirelyonline,includingdigitallegaldocumentation,fundstransfer,andownershiprecordation;and ·manageandtrackinvestmentseasilythroughanonlineportfolio;receiveautomateddistributionsand/orinterestpayments,and

    regularfinancialreporting.

    Q: Whatcompetitiveadvantagesdoyouachievethroughyourrelationshipwithyoursponsor? A: OurManagerutilizesthepersonnelandresourcesofoursponsortoselectourinvestmentsandmanageourday-to-dayoperations.

    Oursponsor’scorporate,investmentandoperatingplatformsarewellestablished,allowingustorealizeeconomiesofscaleandotherbenefitsincludingthefollowing:

    ·ExperiencedManagementTeam—Oursponsorhasahighlyexperiencedmanagementteamofrealestateanddebtfinance

    professionals,ledbyBenjaminS.Miller,itsCo-FounderandChiefExecutiveOfficer.Theseniorinvestmentexecutivesofoursponsorhavededicatedtheirentirecareerstothecommercialrealestatesector.Theseexecutivesprovidestabilityinthemanagementofourbusinessandallowustobenefitfromtheknowledgeandindustrycontactstheyhavegainedthroughnumerousrealestatecycles.Pleasesee“Management—ExecutiveOfficersofourManager”forbiographicalinformationregardingtheseindividuals.

    · RealEstateInvestmentExperience—AsofDecember31,2018,oursponsorfacilitatedororiginatedapproximately245real

    estateassetsthroughthevariousFundrisePlatforminvestmentopportunitieswithaggregatepurchasepricesofapproximately$3.2billion,excluding3WorldTradeCenter(weexcludethisassetbecausewhiletheamountofequityinvestedintheprojectwassimilartootherinvestmentsmadebyoursponsor,theaggregatepurchasepriceof3WorldTradeCenterwasmuchgreaterrelativetooursponsor’sotherinvestments,andwouldgreatlyinflatetheaggregatepurchasepriceoftheotherassetsdisclosed).Ofthe$3.2billionaggregaterealestatepurchaseprices,oursponsorofferedthroughtheFundrisePlatforminvestmentopportunitiesapproximately$658million,consistingofapproximately$229millionofcommercialrealestateloanassets,$215millionofinvestmentsincommercialrealestate(primarilythroughmajority-ownedsubsidiarieswithrightstoreceivepreferredeconomicreturns),and$214millionofcommercialrealestatecommonequityinvestments,includingdirectequitypurchases.TheportfoliosincludedintheFundrisePlatforminvestmentopportunitiesarediversifiedbyinvestmentsize,securitytype,propertytypeandgeographicregion.Asaresultofthedepthandthoroughnessofitsunderwritingprocess,theextensiveinvestingexperienceofitsmanagementteamanditsstrongperformancerecordinmanagingadiverseportfolioofassets,webelieveoursponsorhasearnedareputationasaleadingrealestatemanager,whichhasallowedittoaccessfundingfromabroadbaseofinvestors.

    ·MarketKnowledgeandIndustryRelationships—Throughitsactiveandbroadparticipationinthefixedincomemarkets,our

    sponsorbenefitsfrommarketinformationthatenablesittoidentifyattractivecommercialrealestatedebtinvestmentopportunitiesandtomakeinformeddecisionswithregardtotherelativevaluationoffinancialassetsandcapitalallocation.Webelievethatoursponsor’sextensiveindustryrelationshipswithawidevarietyofcommercialrealestateownersandoperators,brokersandotherintermediariesandthirdpartycommercialrealestatedebtoriginatorsprovidesuswithacompetitiveadvantageinsourcingattractiveinvestmentopportunitiestomeetourinvestmentobjectives.

    ·RelatedPartyLoansandWarehousingofAssets—Ifwehavesufficientfundstoacquireonlyaportionofaloanorother

    investmentthen,inordertocovertheshortfall,wemayobtainarelatedpartyloanfrom,orissueaparticipationinterestto,FundriseLending,LLC,awholly-ownedsubsidiaryofRiseCompaniesCorp.(“FundriseLending”)oritsaffiliates.Ouroperatingagreementexpresslyauthorizesustoenterintosuchrelatedpartyloansandtoissuesuchparticipationinterests.Alternatively,FundriseLendingoritsaffiliatesmaycloseandfundeachloanorotherinvestmentpriortoitbeingacquiredbyus.Thisabilitytowarehouseinvestmentsallowsustheflexibilitytodeployourofferingproceedsasfundsareraised.Wemaythenacquiresuchinvestmentatapriceequaltothefairmarketvalueofsuchinvestment,providedthatitsfairmarketvalueismateriallyequaltoitscost(i.e.,theaggregateequitycapitalinvestedbyFundriseLendingoritsaffiliatesinconnectionwiththeacquisitionandduringthewarehousingofsuchinvestments,plusassumptionofdebtandanycosts,suchasaccruedpropertymanagementfeesandtransfertaxes,incurredduringorasaresultofthewarehousingor,withrespecttodebt,theprincipalbalanceplusaccruedinterestnetofanyapplicablespecialservicingfees).See“PlanofOperation–RelatedPartyLoansandWarehousingofAssets”.

    ·RegulationAExperience—Oursponsor’sexecutiveteamwasoneofthefirstgroupstosponsorarealestateinvestment

    opportunitythroughaRegulationAoffering,havingsponsoredthreeRegulationAofferingsfromAugust2012throughFebruary2014,andfiledandqualifiedsevenadditionalofferingssimilartothisoneundertherevisedRegulationAruleseffectiveasofJune2015(commonlyreferredtoas“RegulationA+”).Inaddition,oursponsor,throughitswholly-ownedsubsidiaries,runsanactiveonlineinvestmentplatformthatutilizesprivateofferingexemptionsundertheSecuritiesActtosellrealestate-relatedsecuritiesto

  • investors.ItsmanagementteamisskilledinreportingandcomplianceobligationsrelatedtoRegulationAandtheSecuritiesAct,andhaswell-developedcomplianceandinvestorrelationsfunctions.

    2

  • FormoreinformationregardingFundrise,LP’sdistributionsupportcommitmentandourdistributionpolicy,pleasesee“Description

    ofOurCommonShares—Distributions—DistributionSupportCommitment”.

    Q: WhyshouldIinvestincommercialrealestateinvestments? A: Ourgoalistoprovideaprofessionallymanaged,diversifiedportfolioofhigh-qualitycommercialrealestateassetstoinvestorswho

    generallyhavehadverylimitedaccesstosuchinvestmentsinthepast.Allocatingsomeportionofyourportfoliotoadirectinvestmentinhigh-qualitycommercialrealestateassetsmayprovideyouwith:

    ·areasonablypredictableandstablelevelofcurrentincomefromtheinvestment; ·diversificationofyourportfolio,byinvestinginanassetclassthathistoricallyhasnotbeencorrelatedwiththestockmarket

    generally;and ·theopportunityforcapitalappreciation. Q: WhyshouldIinvestspecificallyinacompanythatisfocusedprimarilyoncommercialrealestateloansandother

    investmentsincommercialrealestate? A: Webelievethattheabsenceofmanyhistoricalsourcesofdebtfinancingforthecommercialrealestatemarket,resultingfrom

    continueduncertaineconomicconditionshasandwillcontinuetocreateafavorableenvironmentforexperiencedcommercialrealestatelenderstoproduceattractive,risk-adjustedreturnsemployinglittleornoleverageinthenearterm.Thede-leveragingandriskassessmenttakingplaceamongthelargeinstitutionalbanksandtraditionalcreditproviders,aswellasthetemporarysuspensionofsecuritizedvehiclesasameansoffinancing,hasleftrealestateownerswithverylimitedoptionsforobtainingdebtfinancingforacquisitionsandrefinancings.Asaresult,thepricingofrealestatedebtcapitalhasincreaseddramaticallyandthetermsandstructureofrealestateloans,includingborrowerrecourse,havebecomemuchmorefavorableforlenders.Atthesametime,aspartofthisoverallde-leveraging,weexpectthatportfoliosofexistingloansanddebtinstrumentssecuredbycommercialrealestatewillcontinuetobeofferedforsalebybanksandotherinstitutionsatdiscountstoparvalueandinsomecaseswithrelativelyattractivesellerfinancing.Inaddition,manyownersofcommercialrealestatefacematuritiesonloansthathavebeensyndicatedorsecuritizedorboth,andmayhavedifficultyduetotheloanstructureandservicingstandards,inobtaininganextensionevenforperforming,stabilizedassets.

    Q: Whatkindofofferingisthis? A: WeareprimarilyofferingthroughFundrise,LLC’sonlineinvestmentplatformwww.fundrise.com,ortheFundrisePlatform,a

    maximumof$19,736,404inourcommonsharestothepublicona“bestefforts”basis.ThisofferingisbeingconductedasacontinuousofferingpursuanttoRule251(d)(3)ofRegulationA,meaningthatwhiletheofferingofsecuritiesiscontinuous,activesalesofsecuritiesmayhappensporadicallyoverthetermoftheoffering.Further,theacceptanceofsubscriptions,whetherviatheFundrisePlatformorotherwise,maybebrieflypausedattimestoallowustoeffectivelyandaccuratelyprocessandsettlesubscriptionsthathavebeenreceived.

    Q: HowisaninvestmentinyourcommonsharesdifferentfrominvestinginsharesofalistedREIT? A: ThefundamentaldifferencebetweenourcommonsharesandalistedREITisthedailyliquidityavailablewithalisted

    REIT.Althoughwehaveadoptedaredemptionplanthatgenerallyallowsinvestorstoredeemsharesonanongoingbasis,forinvestorswithashort-terminvestmenthorizon,alistedREITmaybeabetteralternativethaninvestinginourcommonshares.However,webelieveourcommonsharesareanalternativewayforinvestorstodeploycapitalintoadiversifiedpoolofrealestateassets,withalowercorrelationtothegeneralstockmarketthanlistedREITs.Inaddition,theoveralllisted-REITsectorhasbeentradingatall-timehighs,withtheFTSENAREITAllREITIndexyieldinggenerallylessthan5%fromJanuary1,2010toDecember31,2016.WebelievesuchpricingsuggeststhatasubstantialportionofthepriceoflistedREITsisattributabletoabuilt-inliquiditypremium,sincerecentunleveredcapitalizationratesonrealestatetransactionsintheprivatesectorhaveaveraged4-6%,accordingtothemostrecentpubliclyavailablereportpublishedbyCBREU.S.CapRateDatafromJanuary2017.Additionally,listedREITsaresubjecttomoredemandingpublicdisclosureandcorporategovernancerequirementsthanweare.WhilewearesubjecttothescaledreportingrequirementsofRegulationA,suchperiodicreportsaresubstantiallylessonerousthanwhatisrequiredofalistedREIT.

  • 3

  • Q: Howisaninvestmentinyourcommonsharesdifferentfrominvestinginsharesofatraditionalnon-exchangetradedREIT? A: Weneitherchargenorpayanybroker-dealerdistributionfees,savinginvestorsapproximately70%to90%inupfrontexpensesas

    comparedtoatraditionalnon-exchangetradedREIT.Traditionalnon-exchangetradedREITsuseahighlymanpower-intensivemethodwithhundredstothousandsofsalesbrokerscallingoninvestorstoselltheirofferings.Oursponsorhaspioneeredalowcostdigitalplatform,whichweintendtoleverageinconductingthisoffering,thusreducingthefinancialburdenstousofofferingourcommonshares.

    Q: Howisaninvestmentinyourcommonsharesdifferentfrominvestinginsharesofotherrealestateinvestmentopportunities

    offeredontheFundrisePlatformoronsimilaronlineinvestmentplatforms? A: Weareoneofthefewnon-exchangetradedREITsoffereddirectlytoallpotentialinvestorsprimarilyovertheinternet.Mostother

    similaronlineinvestmentplatformsthatweareawareoftypicallyofferindividualpropertyinvestmentsasprivateplacementstoaccreditedinvestorsonly.Weintendtoownamorediversifiedportfolio,withcertaintaxadvantagesuniquetoREITs,thatisaccessibletobothaccreditedandnon-accreditedinvestorsatalowinvestmentminimum.

    Q: Whatisthepurchasepriceforyourcommonshares? A: OurManagersetourinitialofferingpriceat$10.00pershare.AsofMarch31,2019,ourpersharepurchasepricecontinuedtobe

    equalto$10.00pershare.Thepersharepurchasepriceinthisofferingwillbeadjustedatthebeginningofeveryfiscalquarter(orassoonascommerciallyreasonablethereafter),andwillbeequaltothegreaterof(i)$10.00pershareor(ii)ourNAVdividedbythenumberofsharesoutstandingasofthecloseofbusinessonthelastbusinessdayofthepriorfiscalquarter.OurManagerwilladjustourpersharepurchasepriceasofthedatethenewNAVisannounced,notthedateofsuchNAV,andinvestorswillpaythemostrecentpubliclyannouncedpurchasepriceasofthedateoftheirsubscription.Ourwebsite,www.fundrise.com,willidentifythecurrentNAVpershare.AnysubscriptionsthatwereceiveduringafiscalquarterwillbeexecutedatapriceequaltoourNAVpershareineffectforthatfiscalquarter.IfamaterialeventoccursinbetweenquarterlyupdatesofNAVthatwouldcauseourNAVpersharetochangeby5%ormorefromthelastdisclosedNAV,wewilldisclosetheupdatedpriceandthereasonforthechangeinanofferingcircularsupplementaspromptlyasreasonablypracticable,andwillupdatetheNAVinformationprovidedonourwebsite.See“DescriptionofOurCommonShares—QuarterlySharePriceAdjustments”formoredetails.

    Q: HowwillyourNAVpersharebecalculated? A: OurNAVpershareiscalculatedattheendofeachfiscalquarterbyoursponsor'sinternalaccountantsusingaprocessthatreflects

    severalcomponents,including(1)estimatedvaluesofeachofourcommercialrealestateassetsandinvestments,asdeterminedbysuchassetmanagementteam,includingrelatedliabilities,basedupon(a)marketcapitalizationrates,comparablesalesinformation,interestrates,netoperatingincome,(b)withrespecttodebt,defaultrates,discountratesandlossseverityrates,(c)forpropertiesthathavedevelopmentorvalueaddplans,progressalongsuchdevelopmentorvalueaddplan,and(d)incertaininstancesreportsoftheunderlyingrealestateprovidedbyanindependentvaluationexpert,(2)thepriceofliquidassetsforwhichthirdpartymarketquotesareavailable,(3)accrualsofperiodicdistributionsand(4)estimatedaccrualsofoperatingrevenuesandexpenses.Forjointventureordirectequityinvestments,oursponsorprimarilyreliesondiscountedcashflowmethod.Note,however,thatthedeterminationofourNAVisnotbasedon,norintendedtocomplywith,fairvaluestandardsunderGAAP,andourNAVmaynotbeindicativeofthepricethatwewouldreceiveforourassetsatcurrentmarketconditions.Ininstanceswhereanappraisaloftheunderlyingrealestateassetisnecessary,including,butnotlimitedto,instanceswhereourManagerisunsureofitsabilityonitsowntoaccuratelydeterminetheestimatedvaluesofourcommercialrealestateassetsandinvestments,orinstanceswherethirdpartymarketvaluesforcomparablepropertiesareeithernonexistentorextremelyinconsistent,wewillengageanappraiserthathasexpertiseinappraisingcommercialrealestateloansandassets,toactasourindependentvaluationexpert.Theindependentvaluationexpertisnotresponsiblefor,norprepares,ourquarterlyNAVpershare.See“DescriptionofOurCommonShares—ValuationPolicies”formoredetailsaboutourNAVandhowitwillbecalculated.

    4

  • Q: HowexactwillthecalculationofthequarterlyNAVpersharebe? A: Asthereisnomarketvalueforoursharesastheyarenotexpectedtobelistedortraded,ourgoalistoprovideareasonableestimate

    ofthevalueofourcommonsharesasoftheendofeachfiscalquarter,withtheunderstandingthatourcommonsharesarenotlistedortradedonanystockexchangeorothermarketplace.Ourassetswillconsistprincipallyofcommercialrealestateloansandotherrealestateinvestments.Oursponsor’sinternalaccountants’valuationoftherealestateunderlyingtheseassetsissubjecttoanumberofjudgmentsandassumptionsthatmaynotprovetobeaccurate.Theuseofdifferentjudgmentsorassumptionswouldlikelyresultindifferentestimatesofthevalueoftherealestateunderlyingourassets.Moreover,althoughweevaluateandprovideourNAVpershareonaquarterlybasis,ourNAVpersharemayfluctuatedaily,sothattheNAVpershareineffectforanyfiscalquartermaynotreflectthepreciseamountthatmightbepaidforyoursharesinamarkettransaction.Further,ourpublishedNAVpersharemaynotfullyreflectcertainmaterialeventstotheextentthattheyarenotknownortheirfinancialimpactonourportfolioisnotimmediatelyquantifiable.AnyresultingpotentialdisparityinourNAVpersharemaybeinfavorofeithershareholderswhoredeemtheirshares,orshareholderswhobuynewshares,orexistingshareholders.Inaddition,thedeterminationofourNAVisnotbasedon,norintendedtocomplywith,fairvaluestandardsunderGAAP,andourNAVmaynotbeindicativeofthepricethatwewouldreceiveforourassetsatcurrentmarketconditions.See“DescriptionofOurCommonShares—ValuationPolicies”.

    Q: WillIhavetheopportunitytoredeemmycommonshares? A: Yes.Whileyoushouldviewthisinvestmentaslong-term,wehaveadoptedaredemptionplanwhereby,onamonthlybasis,an

    investormayobtainliquiditymonthly,followingaminimumsixty(60)daywaitingperiodaftersubmittingtheirredemptionrequest.OurManagerhasdesignedourredemptionplanwithaviewtowardsprovidinginvestorswithaninitialperiodinwhichtheycantodecidewhetheralong-terminvestmentinourCompanyisrightforthem.Inaddition,despitetheilliquidnatureoftheassetsexpectedtobeheldbytheCompany,theManagerbelievesitisbesttoprovidetheopportunityforongoingliquidityintheeventshareholdersneeditintheformofadiscountedredemptionpricepriortoyear5,whicheconomicbenefitindirectlyaccruestoshareholderswhohavenotrequestedredemption.NeithertheManagernoroursponsorreceivesanyeconomicbenefitasaresultofthediscountedredemptionpricethroughyear5.

    Pursuanttoourredemptionplan,ashareholdermayonly(a)haveoneoutstandingredemptionrequestatanygiventimeand(b)requestthatweredeemuptothelesserof5,000sharesor$50,000pereachredemptionrequest.Inaddition,theredemptionplanissubjecttocertainliquiditylimitations,whichmayfluctuatedependingontheliquidityoftherealestateassetsheldbyus.Thecalculationoftheredemptionpricewilldepend,inpart,onwhetherashareholderrequestsredemptionwithinthefirsteighty-nine(89)daysoffirstacquiringtheshares(the“IntroductoryPeriod”)orthereafter(the“Post-IntroductoryPeriod”).DuringtheIntroductoryPeriod,thepershareredemptionpricewillbeequaltothepurchasepriceofthesharesbeingredeemedreducedby(i)theaggregatesumofdistributionspaidwithrespecttosuchshares,roundeddowntothenearestcentand(ii)theaggregatesumofdistributions,ifany,declaredbutunpaidonthesharessubjecttotheredemptionrequest.Inotherwords,ashareholderwouldreceivebacktheiroriginalinvestmentamount,fromtheredemptionpricepaid,priordistributionsreceivedanddistributionsthathavebeendeclared(andthatwillbereceivedwhenpaid),butwouldnotreceiveanyamountsinexcessoftheiroriginalinvestmentamount.DuringthePost-IntroductoryPeriod,thepershareredemptionpricewillbecalculatedbasedonadecliningdiscounttothepersharepriceforourcommonsharesineffectatthetimeoftheredemptionrequest,androundeddowntothenearestcent.Inaddition,theredemptionplanissubjecttocertainliquiditylimitations,whichmayfluctuatedependingontheliquidityoftherealestateassetsheldbyus.DuringthePost-IntroductoryPeriod,theredemptionpricewithrespecttothecommonsharesthataresubjecttotheredemptionrequestwillnotbereducedbytheaggregatesumofdistributions,ifany,thathavebeen(i)paidwithrespecttosuchsharespriortothedateoftheredemptionrequestor(ii)declaredbutunpaidonsuchshareswithrecorddatesduringtheperiodbetweentheredemptionrequestdateandtheredemptiondate

    HoldingPeriodfromDateofSettlement

    EffectiveRedemptionPrice(aspercentageofpershare

    redemptionprice)(1) Lessthan90days(IntroductoryPeriod) 100.0%(2)(3)90daysuntil3years 97.0%(4)3yearsto4years 98.0%(5)4yearsto5years 99.0%(6)Morethan5years 100.0%(7)

  • 5

  • (1) TheEffectiveRedemptionPricewillberoundeddowntothenearest$0.01.(2) ThepershareredemptionpriceduringtheIntroductoryPeriodiscalculatedbaseduponthepurchasepriceoftheshares,

    notthepersharepriceineffectatthetimeoftheredemptionrequest.(3) TheEffectiveRedemptionPriceduringtheIntroductoryPeriodwillbereducedbytheaggregatesumofdistributionspaid

    orpayableonsuchshares,theamountofwhichweareunabletocalculateatthistime.(4) Forsharesheldatleastninety(90)daysbutlessthanthree(3)years,theEffectiveRedemptionPriceincludesthefixed3%

    discounttothepersharepriceforourcommonsharesineffectatthetimeoftheredemptionrequest.(5) Forsharesheldatleastthree(3)yearsbutlessthanfour(4)years,theEffectiveRedemptionPriceincludesthefixed2%

    discounttothepersharepriceforourcommonsharesineffectatthetimeoftheredemptionrequest.(6) Forsharesheldatleastfour(4)yearsbutlessthanfive(5)years,theEffectiveRedemptionPriceincludesthefixed1%

    discounttothepersharepriceforourcommonsharesineffectatthetimeoftheredemptionrequest.(7) Forsharesheldatleastfive(5)years,theEffectiveRedemptionPricedoesnotincludeanydiscounttothepershareprice

    forourcommonsharesineffectatthetimeoftheredemptionrequest. Asshareholdersmustobserveaminimumsixty(60)daywaitingperiodfollowingaredemptionrequestbeforesuchrequestwillbe

    honored,whetheraredemptionrequestisdeemedtobeintheIntroductoryPeriodorthePost-IntroductoryPeriodwillbedeterminedasofthedatetheredemptionrequestismade,notthedatetheredemptionrequestishonored.Meaning,forexample,ifaredemptionrequestissubmittedduringtheIntroductoryPeriod,buthonoredaftertheIntroductoryPeriod,theeffectiveredemptionpricewillbedeterminedusingtheIntroductoryPeriodmethodology.Furthermore,anyshareholderrequestingredemptionwillberesponsibleforanythird-partycostsincurredineffectingsuchredemption,includingbutnotlimitedto,banktransactioncharges,custodyfees,and/ortransferagentcharges.Theredemptionplanmaybechangedorsuspendedatanytimewithoutnotice.See“DescriptionofOurCommonShares—RedemptionPlan”formoredetails.

    Q: Whatisthenumberandpercentageofcommonsharesthathavebeensubmittedforredemptionandredeemed,

    respectively? A: AsofDecember31,2018,approximately682,000commonshareshavebeensubmittedforredemptionand100%ofsuch

    redemptionrequestshavebeenhonored. Q: Arethereanylimitsonmyabilitytoredeemmyshares? A: Yes.Whilewedesignedourredemptionplantoallowshareholderstorequestredemptionsonamonthlybasis,weneedtoimpose

    limitationsonthesizeofindividualredemptionrequestsandthetotalamountofnetredemptionspercalendarquarterinordertomaintainsufficientsourcesofliquiditytosatisfyredemptionrequestswithoutimpactingourabilitytoinvestincommercialrealestateassetsandmaximizeinvestorreturns.

    Inaddition,intheeventourManagerdetermines,initssolediscretion,thatwedonothavesufficientfundsavailabletoredeemallofthecommonsharesforwhichredemptionrequestshavebeensubmittedduringanygivenmonth,suchpendingrequestswillbehonoredonapro-ratabasis,ifatall.Intheeventthatnotallredemptionsarebeinghonoredinagivenmonth,theredemptionrequestsnotfullyhonoredwillhavetheremainingamountofsuchredemptionrequestsconsideredduringthenextmonthinwhichredemptionsarebeinghonored.Accordingly,allunsatisfiedredemptionrequestswillbetreatedasrequestsforredemptiononthenextdateonwhichredemptionsarebeinghonored,withredemptionsprocessedonapro-ratabasis,ifatall.Iffundsavailablefortheredemptionplanarenotsufficienttoaccommodateallredemptionrequestsonsuchfutureredemptiondate,commonshareswillberedeemedonapro-ratabasis,ifatall.Weintendtolimitshareholderstoone(1)redemptionrequestoutstandingatanygiventime,meaningthat,ifacommonshareholderdesirestorequestmoreorlesssharesberedeemed,suchcommonshareholdermustfirstwithdrawthefirstredemptionrequest,whichmayaffectwhethertherequestisconsideredinthe“IntroductoryPeriod”or“Post-IntroductoryPeriod”.Forinvestorswhoholdcommonshareswithmorethanonerecorddate,redemptionrequestswillbeappliedtosuchcommonsharesintheorderinwhichtheysettled,onalastinfirstoutbasis–meaning,thosecommonsharesthathavebeencontinuouslyheldfortheshortestamountoftimewillberedeemedfirst.Inaddition,weintendlimitindividualredemptionrequeststothelesserof5,000sharesor$50,000pereachredemptionrequest,whichmayaffectwhethertheentiretyofaredemptionrequestwillbeconsideredtobeinthe“IntroductoryPeriod”or“Post-IntroductoryPeriod”.InaccordancewiththeSEC’scurrentguidanceonredemptionplans,weintendtolimitredemptionsinanycalendarmonthtoshareswhoseaggregatevalue(basedontherepurchasepricepershareineffectasoftheredemptiondate)islessthanorequalto0.5%of

  • theNAVofallofouroutstandingsharesasofthefirstdayofsuchcalendarmonth,andintendtolimittheamountredeemedinanycalendarquartertoshareswhoseaggregatevalue(basedontherepurchasepricepershareineffectasoftheredemptiondate)is1.25%oftheNAVofallofouroutstandingsharesasoffirstdayofthelastmonthofsuchcalendarquarter(e.g.,March1,June1,September1,orDecember1),withexcesscapacitycarriedovertolatercalendarquartersinthatcalendaryear.However,asweintendtomakeanumberofcommercialrealestateinvestmentsofvaryingtermsandmaturities,ourManagermayelecttoincreaseordecreasetheamountofcommonsharesavailableforredemptioninanygivenmonthorquarter,asthesecommercialrealestateassetsarepaidofforsold,butwedonotintendtoredeemmorethan5.00%ofthecommonsharesoutstandingduringanycalendaryear.Notwithstandingtheforegoing,wearenotobligatedtoredeemcommonsharesundertheredemptionplan.Further,ourManagermayinitssolediscretion,amend,suspend,orterminatetheredemptionplanatanytimewithoutpriornotice,includingtoprotectouroperationsandournon-redeemedshareholders,topreventanundueburdenonourliquidity,topreserveourstatusasaREIT,followinganymaterialdecreaseinourNAV,orforanyotherreason.However,intheeventthatweamend,suspendorterminateourredemptionplan,wewillfileanofferingcircularsupplementand/orForm1-U,asappropriate,andpostsuchinformationontheFundrisePlatformtodisclosesuchamendment.OurManagermayalso,initssolediscretion,declineanyparticularredemptionrequestifitbelievessuchactionisnecessarytopreserveourstatusasaREIT.See“DescriptionofOurCommonShares—RedemptionPlan”formoredetails.

    Q: WillIstillbeentitledtodistributionsafterIsubmitarequestforredemption? A: Yes.Youwillcontinuetoreceivedistributionswithrespecttothecommonsharesthataresubjecttoaredemptionrequestbetween

    thetimeyoumakesuchredemptionrequestandtheeffectivedateoftheredemption.However,ifyouredeemyoursharesduringtheIntroductoryPeriod,thosedistributionswillbecreditedagainsttheredemptionpriceotherwisepayabletoyousuchthatyourredemptionpricewillbenogreaterthanyouroriginalinvestment.

    6

  • Q: WillIbechargedupfrontsellingcommissions? A: No.Investorswillnotpayupfrontsellingcommissionsaspartofthepricepercommonsharepurchasedinthisoffering.

    Additionally,thereisnodealermanagerfeeorotherservice-relatedfeeinconnectionwiththeofferingandsaleofourcommonsharesthroughtheFundrisePlatform.

    Q: Whowillpayyourorganizationandofferingcosts? A: OurManageroritsaffiliateshavepaidandwillcontinuetopayonourbehalfallcostsincurredinconnectionwithourorganization

    andtheofferingofourshares.See“EstimatedUseofProceeds”formoreinformationaboutthetypesofcoststhatmaybeincurred,includingthoseexpensesdescribedinthenextparagraph.Followingthecompletionofourinitialoffering,webegantoreimburseourManager,withoutinterest,fortheseorganizationandofferingcostsincurredbothbeforeandaftersuchdate.Reimbursementpaymentswillbemadeinmonthlyinstallments,buttheaggregatemonthlyamountreimbursedcanneverexceed0.50%oftheaggregategrossofferingproceedsfromthisandourofferings.Ifthesumofthetotalunreimbursedamountofsuchorganizationandofferingcosts,plusnewcostsincurredsincethelastreimbursementpayment,exceedsthereimbursementlimitdescribedabovefortheapplicablemonthlyinstallment,theexcesswillbeeligibleforreimbursementinsubsequentmonths(subjecttothe0.50%limit),calculatedonanaccumulatedbasis,untilourManagerhasbeenreimbursedinfull.AsofDecember31,2018,approximately$1,006,000inorganizationalandofferingcostshavebeenincurredbyandreimbursedtoourManagerinconnectionwithourpriorofferings.

    Q: WhatfeesandexpensesdoyoupaytotheManageroranyofitsaffiliates? A: WepayourManageraquarterlyassetmanagementfeecurrentlyequaltoanannualizedrateof0.85%basedonourNAVattheend

    ofeachpriorquarter.ThisrateisdeterminedbyourManagerinitssolediscretion,butcannotexceedanannualizedrateof1.00%.Theamountoftheassetmanagementfeemayvaryfromtimetotime,andwewillpubliclyreportanychangesintheassetmanagementfee.OurManager,oranaffiliateofourManager,isentitledtoreimbursementforcostsincurredinconnectionwiththespecialservicingofanynon-performingasset,aswellasoriginationfeesthataregenerallypaidbythejoint-venture,borrowersorco-investors.

    WereimburseourManagerfortheorganizationandofferingexpensesthattheManagerhaspaidorwillpayonourbehalf.WewillalsoreimburseourManagerforout-of-pocketexpensesinconnectionwiththeoriginationofourcommercialrealestateloansandotherreal-estaterelatedinvestments,totheextentnotreimbursedbytheborrower.Additionally,wereimburseourManagerforout-of-pocketexpensespaidtothirdpartiesinconnectionwithprovidingservicestous.ThisdoesnotincludetheManager’soverhead,employeecostsbornebytheManager,utilitiesortechnologycosts.TheexpensereimbursementsthatwewillpaytoourManagerincludeexpensesincurredbyoursponsorintheperformanceofservicesunderthesharedservicesagreementbetweenourManagerandoursponsor.See“Management—SharedServicesAgreement”.

    7

  • Thepaymentbyusoffeesandexpenseswillreducethecashavailableforinvestmentanddistributionandwilldirectlyimpactour

    quarterlyNAV.See“ManagementCompensation”formoredetailsregardingthefeesthatwillbepaidtoourManageranditsaffiliates.

    Q: Willyouuseleverage? A: Yes,wemayuseleverage,althoughasofDecember31,2018,wehadnotutilizedanyleverageinmakingourinvestments.Our

    targetportfolio-wideleverageisbetween50-85%ofthegreaterofcost(beforedeductingdepreciationorothernon-cashreserves)orfairmarketvalueofourassets.Duringtheperiodwhenweareacquiringourinitialportfolio,wemayemploygreaterleverageonindividualassets(thatwillalsoresultingreaterleverageoftheinitialportfolio)inordertoquicklybuildadiversifiedportfolioofassets.Pleasesee“InvestmentObjectivesandStrategy”formoredetails.

    Q: HowoftenwillIreceivedistributions? A: WeexpectthatourManagerwilldeclareandpaydistributionsquarterlyinarrears;however,ourManagermaydeclareother

    periodicdistributionsascircumstancesdictate.AnydistributionswemakewillbeatthediscretionofourManager,andwillbebasedon,amongotherfactors,ourpresentandreasonablyprojectedfuturecashflow.WeexpectthattheManagerwillsettherateofdistributionsatalevelthatwillbereasonablyconsistentandsustainableovertime,whichwillbefullydependentontheyieldsgeneratedbyourassetsandmaybesubstantiallylessthanthedistributionratethatwaspayablewhilethedistributionsupportcommitmentwasineffect.Inaddition,theManager’sdiscretionastothepaymentofdistributionswillbelimitedbytheREITdistributionrequirements,whichgenerallyrequirethatwemakeaggregateannualdistributionstoourshareholdersofatleast90%ofourREITtaxableincome,computedwithoutregardtothedividendspaiddeductionandexcludingnetcapitalgain.Moreover,evenifwemaketherequiredminimumdistributionsundertheREITrules,wewillbesubjecttoU.S.federalincomeandexcisetaxesonourundistributedtaxableincomeandgains.Asaresult,theManagerintendstomakeadditionaldistributions,beyondtheminimumREITdistribution,toavoidsuchtaxes.See“DescriptionofOurCommonShares—Distributions”and“U.S.FederalIncomeTaxConsiderations”.

    AnydistributionsthatwemakewilldirectlyimpactourNAV,byreducingtheamountofourassets.Ourgoalistoprovidea

    reasonablypredictableandstablelevelofcurrentincome,throughquarterlydistributions,whileatthesametimemaintainingafairlevelofconsistencyinourNAV.Overthecourseofyourinvestment,yourdistributionsplusthechangeinNAVpershare(eitherpositiveornegative)willproduceyourtotalreturn.

    Q: Whatwillbethesourceofyourdistributions? A: Wemaypaydistributionsfromsourcesotherthancashflowfromoperations,includingfromtheproceedsofthisoffering,the

    privateplacementstooursponsorandFundrise,LP,ortheadditionalcommonsharessoldtoanaffiliateofoursponsorpursuanttothedistributionsupportagreement(see“Q:Whatcompetitiveadvantagesdoweachievethroughourrelationshipwithoursponsor–DistributionSupportCommitment”above),interestordividendincomereceivedfromourinvestments,principalrepaymentoftheloansthatwemake,redemptionand/orredemptionpremiumsofinvestmentsincommercialrealestatethroughmajority-ownedsubsidiarieswithrightstoreceivepreferredeconomicreturns,thesaleofinvestmentsorloanproceeds,amongothers,andwehavenolimitontheamountswemaypayfromsuchsources.

    8

  • Q: WillthedistributionsIreceivebetaxableasordinaryincome? A: Unlessyourinvestmentisheldinaqualifiedtax-exemptaccountorwedesignatecertaindistributionsascapitalgaindividends,

    distributionsthatyoureceivegenerallywillbetaxedasordinaryincometotheextenttheyarefromcurrentoraccumulatedearningsandprofits.However,fortaxableyearsbeginningafterDecember31,2017andbeforeJanuary1,2026,andsubjecttocertainlimitations,pursuanttotherecentlyenactedH.R.1,knownastheTaxCutsandJobsAct,ortheTCJA,non-corporatetaxpayersaregenerallyeligibleforadeductionofupto20%(subjecttocertainlimitations)onmostordinaryREITdividendsandcertaintradeorbusinessincomeofnon-corporatetaxpayers.TheportionofyourdistributioninexcessofcurrentandaccumulatedearningsandprofitsisconsideredareturnofcapitalforU.S.federalincometaxpurposesandwillreducethetaxbasisofyourinvestment,ratherthanresultincurrenttax,untilyourbasisisreducedtozero.ReturnofcapitaldistributionsmadetoyouinexcessofyourtaxbasisinourcommonshareswillbetreatedassalesproceedsfromthesaleofourcommonsharesforU.S.federalincometaxpurposes.Distributionswedesignateascapitalgaindividendsaregenerallytaxableatlong-termcapitalgainsratesforU.S.federalincometaxpurposes.However,becauseeachinvestor’staxconsiderationsaredifferent,werecommendthatyouconsultwithyourtaxadvisor.Youalsoshouldreviewthesectionofthisofferingcircularentitled“U.S.FederalIncomeTaxConsiderations”,includingforadiscussionofthespecialrulesapplicabletodistributionsinredemptionofsharesandliquidatingdistributions.

    Q: MayIreinvestmycashdistributionsinadditionalshares? A: Yes.Whilewehavenotadoptedadistributionreinvestmentplanwherebyinvestorsmayelecttohavetheircashdistributions

    automaticallyreinvestedinadditionalcommonshares,solongasthisofferingremainsongoing,youmaychoosetousetheproceedsofanydistributiontopurchaseadditionalshareshereundereitherdirectlyorthroughaprogramestablishedbyourManager.Thecurrentpurchasepriceforsuchsharesis$10.00.Thepersharepurchasepriceinthisofferingwillbeadjustedatthebeginningofeveryfiscalquarter(orassoonascommerciallyreasonablethereafter),andwillbeequaltothegreaterof(i)$10.00pershareor(ii)ourNAVdividedbythenumberofsharesoutstandingasofthecloseofbusinessonthelastbusinessdayofthepriorfiscalquarter.OurManagerwilladjustourpersharepurchasepriceasofthedatethenewNAVisannounced,notthedateofsuchNAV,andinvestorswillpaythemostrecentpubliclyannouncedpurchasepriceasofthedateoftheirsubscription.Note,however,thatundertherulesapplicabletousunderRegulationA,weareonlypermittedtopubliclyofferupto$50,000,000ofourcommonsharesinanytwelve-monthperiod.

    Q: Whomightbenefitfromaninvestmentinyourshares? A: Aninvestmentinoursharesmaybebeneficialforyouifyouseektodiversifyyourpersonalportfoliowithapubliccommercialreal

    estateinvestmentvehiclefocusedprimarilyoncommercialrealestateloans,investmentsincommercialrealestateandotherselectrealestate-relatedassets,seektoreceivecurrentincome,seektopreservecapitalandareabletoholdyourinvestmentforatimeperiodconsistentwithourliquiditystrategy.Ontheotherhand,wecautionpersonswhorequireimmediateliquidityorguaranteedincome,orwhoseekashort-terminvestment,thataninvestmentinourshareswillnotmeetthoseneeds.

    Q: Arethereanyrisksinvolvedinbuyingyourshares? A: Investinginourcommonsharesinvolvesahighdegreeofrisk.Ifweareunabletoeffectivelymanagetheimpactoftheserisks,we

    maynotmeetourinvestmentobjectives,andtherefore,youshouldpurchasethesesecuritiesonlyifyoucanaffordacompletelossofyourinvestment.See“RiskFactors”foradescriptionoftherisksrelatingtothisofferingandaninvestmentinourshares.

    Q: Howdoesa“bestefforts”offeringwork? A: Whencommonsharesareofferedtothepublicona“bestefforts”basis,weareonlyrequiredtouseourbesteffortstosellour

    commonshares.Neitheroursponsor,Managernoranyotherpartyhasafirmcommitmentorobligationtopurchaseanyofourcommonshares.

    Q: Whocanbuyshares? A: Generally,youmaypurchasesharesifyouarea“qualifiedpurchaser”(asdefinedinRegulationA).“Qualifiedpurchasers”include: ·“accreditedinvestors”underRule501(a)ofRegulationD;and

    9

  • ·allotherinvestorssolongastheirinvestmentinourcommonsharesdoesnotrepresentmorethan10%ofthegreateroftheir

    annualincomeornetworth(fornaturalpersons),or10%ofthegreaterofannualrevenueornetassetsatfiscalyear-end(fornon-naturalpersons).

    However,ourcommonsharesarebeingofferedandsoldonlytothoseinvestorsthatarewithinthelattercategory(i.e.,investors

    whoseinvestmentinourcommonsharesdoesnotrepresentmorethan10%oftheapplicableamount),regardlessofaninvestor’sstatusasan“accreditedinvestor”.

    Networthinallcasesshouldbecalculatedexcludingthevalueofaninvestor’shome,homefurnishingsandautomobiles.We

    reservetherighttorejectanyinvestor’ssubscriptioninwholeorinpartforanyreason,includingifwedetermineinoursoleandabsolutediscretionthatsuchinvestorisnota“qualifiedpurchaser”forpurposesofRegulationA.Pleaserefertothesectionaboveentitled“StateLawExemptionandPurchaseRestrictions”formoreinformation.

    Q: HowdoIbuyshares? A: Youmaypurchaseourcommonsharesinthisofferingbycreatinganewaccount,orloggingintoyourexistingaccount,atthe

    FundrisePlatform.YouwillneedtofilloutasubscriptionagreementliketheoneattachedtothisofferingcircularasAppendixAforacertaininvestmentamountandpayforthesharesatthetimeyousubscribe.

    Q: Isthereanyminimuminvestmentrequired? A: Yes.Ifyouareafirsttimeinvestorinourcommonshares,youmustinitiallypurchaseatleast100sharesinthisoffering,or$1,000

    basedonthecurrentpershareprice.Thereisnominimuminvestmentrequirementonadditionalpurchasesafteryouhavepurchasedaminimumof100shares.However,incertaininstances,wemayrevisetheminimumpurchaserequirementsinthefutureorelecttowaivetheminimumpurchaserequirement,suchasforindividualswhoparticipateindifferentplansestablishedbyourManagerthroughwhichtheycaninvestinourcommonshares.Inaddition,inordertohelpprotectusfromtheriskofchargebacks,weintendtorequirethatanysubscriptioninexcessof$125,000ofoursharesbefundedthroughabankwiretransferandnotanACHelectronicfundtransfer.

    Q: MayImakeaninvestmentthroughmyIRAorothertax-deferredretirementaccount? A: Generally,yes.WecurrentlyacceptinvestmentsthroughIRAsmaintainedwithcertaincustodians,althoughweintendtolimitthe

    amountofIRAinvestmentstolessthan25percentofourshares.However,IRAsorothertax-deferredretirementaccountsthatinvestinoursharesgenerallyaresubjecttotaxonallorasignificantportionoftheirshareofourprofitsas“unrelatedbusinesstaxableincome”undertheCode.

    Q: Whatwillyoudowiththeproceedsfromyouroffering? A: Wehaveused,andintendtocontinuetouse,substantiallyallofthenetproceedsfromthisoffering(afterpayingorreimbursing

    offeringexpenses)tocontinuetoinvestinandmanageadiverseportfolioofcommercialrealestateloansandinvestmentsincommercialrealestateandotherselectrealestate-relatedassets.WeexpectthatanyexpensesorfeespayabletoourManagerforitsservicesinconnectionwithmanagingourdailyaffairs,includingbutnotlimitedto,theselectionandacquisitionororiginationofourinvestments,willbepaidfromcashflowfromoperations.Ifsuchfeesandexpensesarenotpaidfromcashflow(orwaived)theywillreducethecashavailableforinvestmentanddistributionandwilldirectlyimpactourquarterlyNAV.See“ManagementCompensation”formoredetailsregardingthefeesthatarepaidtoourManageranditsaffiliates.

    10

  • Wemaynotbeabletopromptlyinvestthenetproceedsofthisofferingincommercialrealestateloans,investmentsincommercial

    realestateandotherselectrealestate-relatedassets.Intheinterim,wemayinvestinshort-term,highlyliquidorotherauthorizedinvestments.Suchshort-terminvestmentswillnotearnashighofareturnasweexpecttoearnonourrealestate-relatedinvestments.

    Q: Howlongwillthisofferinglast? A: Wecurrentlyexpectthatthisofferingwillremainopenforinvestorsuntilweraisethemaximumamountbeingoffered,unless

    terminatedbyusatanearliertime.Wereservetherighttoterminatethisofferingforanyreasonatanytime. Q: WillIbenotifiedofhowmyinvestmentisdoing? A: Yes,wewillprovideyouwithperiodicupdatesontheperformanceofyourinvestmentinus,including: ·anannualreport; ·asemi-annualreport; ·currenteventreportsforspecifiedmaterialeventswithinfourbusinessdaysoftheiroccurrence; · supplementstotheofferingcircular,ifwehavematerialinformationtodisclosetoyou;and ·otherreportsthatwemayfileorfurnishtotheSECfromtimetotime. WewillprovidethisinformationtoyoubypostingsuchinformationontheSEC’swebsiteatwww.sec.gov,ontheFundrise

    Platformatwww.fundrise.com,orviae-mail. Q: WhenwillIgetmydetailedtaxinformation? A: YourIRSForm1099-DIVtaxinformation,ifrequired,willbeprovidedbyJanuary31oftheyearfollowingeachtaxableyear. Q: Whocanhelpanswermyquestionsabouttheoffering? A: Ifyouhavemorequestionsabouttheoffering,orifyouwouldlikeadditionalcopiesofthisofferingcircular,youshouldcontactus

    [email protected]:

    FundriseRealEstateInvestmentTrust,LLC11DupontCircleNW,9thFL

    Washington,DC20036Attn:InvestorRelations

    11

  • OFFERINGSUMMARY

    Thisofferingsummaryhighlightsmaterialinformationregardingourbusinessandthisofferingthatisnototherwiseaddressed

    inthe“QuestionsandAnswersAboutthisOffering”sectionofthisofferingcircular.Becauseitisasummary,itmaynotcontainalloftheinformationthatisimportanttoyou.Tounderstandthisofferingfully,youshouldreadtheentireofferingcircularcarefully,includingthe“RiskFactors”sectionbeforemakingadecisiontoinvestinourcommonshares.

    FundriseRealEstateInvestmentTrust,LLC

    FundriseRealEstateInvestmentTrust,LLCisaDelawarelimitedliabilitycompanyformedtoinvestinandmanagea

    diversifiedportfolioofcommercialrealestateloansandinvestmentsincommercialrealestate.Wemayalsoinvestincommercialrealestate-relateddebtsecurities,andotherrealestate-relatedassets.WeintendtocontinuetooperateinamannerthatwillallowustoqualifyasaREITforU.S.federalincometaxpurposes.Amongotherrequirements,REITsarerequiredtodistributetoshareholdersatleast90%oftheirannualREITtaxableincome(computedwithoutregardtothedividendspaiddeductionandexcludingnetcapitalgain).

    Ourofficeislocatedat11DupontCircleNW,9thFL,Washington,DC20036.Ourtelephonenumberis(202)584-0550.

    InformationregardingourCompanyisalsoavailableonourwebsiteatwww.fundrise.com.

    RecentDevelopments

    CapitalRaisedThroughMay27,2019,ourongoingofferinghasraisedanaggregateofapproximately$116.4millionincapitalpursuantto

    RegulationA(notincludingtheapproximate$1.2millionreceivedinprivateplacementstooursponsor,RiseCompaniesCorp.,andFundrise,LP,anaffiliateofoursponsor,andthedistributionsupportcommitment).Inthe12-monthperiodpriortoMay27,2019,wehadsettledsubscriptionsforapproximately$30,263,596.Wearecontinuingtoofferupto$19,736,404inourcommonshares,whichrepresentsthevalueofthesharesavailabletobeofferedasofMay27,2019outoftherolling12-monthmaximumofferingamountof$50millioninourcommonshares.

    AssetsAcquiredSee“PlanofOperation—OurInvestments”foradetailedsummaryofourassets.DistributionsPaidThroughMay27,2019,wehavedeclaredanaggregateof26distributionssinceourinceptionwithanaverageannualizedyield

    of9.04%.See“DescriptionofOurCommonShares—Distributions”below.Duringfiscalyear2018,ourdistributionswerefundedfrombothcashflowfromourrealestateinvestments.Whileweareundernoobligationtodoso,weexpectthatourManagerwillcontinuetodeclaredistributionswithadailyrecorddate,andpaydistributionsquarterlyinarrearsinamountssimilartothosepreviouslydeclared.However,therecanbenoassuranceastowhetherdistributionswillbedeclaredortheamountofsuchdistributions.

    NetAssetValueasofMarch31,2019AsofMarch31,2019,ourNAVpercommonshareis$9.96.ThisNAVpercommonsharewillbeeffectiveuntilupdatedbyus

    onoraboutJune30,2019(orassoonascommerciallyreasonablethereafter),unlessupdatedbyuspriortothattime.ShareRedemptionPlanStatusDuringthequarterendedMarch31,2019,weredeemedapproximately141,300commonsharespursuanttoourshare

    redemptionplan.

    InvestmentStrategyWehaveused,andcontinuetoexpecttousesubstantiallyallofthenetproceedsfromourofferingstooriginate,acquireand

    structurecommercialrealestateloans(includingseniormortgageloans,subordinatedmortgageloans(alsoreferredtoasB-Notes),mezzanineloans,andparticipationsinsuchloans)andinvestmentsincommercialrealestate(throughmajority-ownedsubsidiarieswith

  • rightstoreceivepreferredeconomicreturns).Wemayalsoinvestincommercialrealestate-relateddebtsecurities(includingCMBS,CDOsandREITseniorunsecureddebt),jointventures,andotherrealestate-relatedassets.

    Weseektocreateandmaintainaportfolioofinvestmentsthatgeneratealowvolatilityincomestreamofattractiveand

    consistentcashdistributions.Ourfocusoninvestingindebtinstrumentsemphasizesthepaymentofcurrentreturnstoinvestorsandpreservationofinvestedcapitalasourprimaryinvestmentobjectives,withalesseremphasisonseekingcapitalappreciationfromourinvestments,asistypicallythecasewithmoreopportunisticorequity-orientedstrategies.

    OurManagerexpectstocontinuetodirectlystructure,underwriteandoriginatemanyofthedebtproductsinwhichweinvest

    asthisprovidesforthebestopportunitytomanageourborrowerandpartnerrelationshipsandoptimizethetermsofourinvestments.Ourprovenunderwritingprocess,whichourmanagementteamhassuccessfullydevelopedovertheirextensiverealestatecareersinavarietyofmarketconditionsandimplementedatoursponsor,involvescomprehensivefinancial,structural,operationalandlegalduediligenceofourborrowersandpartnersinordertooptimizepricingandstructuringandmitigaterisk.

    12

  • InvestmentObjectives

    Ourprimaryinvestmentobjectivesare:

    · topayattractiveandconsistentcashdistributions;and

    · topreserve,protectandreturnyourcapitalcontribution.Wealsoseektorealizegrowthinthevalueofourinvestmentsbytimingtheirsaletomaximizevalue.However,thereisno

    assurancethatourinvestmentobjectiveswillbemet.

    MarketOpportunitiesWebelievethatthenearandintermediate-termmarketforinvestmentincommercialrealestateloans,commercialrealestate

    andotherrealestate-relatedassetsiscompellingfromarisk-returnperspective.Giventheprospectoflowgrowthfortheeconomy,wefavorastrategyweightedtowardtargetingseniorandmezzaninedebtwhichmaximizecurrentincome,withsignificantsubordinatecapitalanddownsidestructuralprotections.Incontrast,returnstypicallyassociatedwithpureequitystrategiesaremostly“back-ended”andaredependentonassetappreciation,capitalizationratecompression,cashflowgrowth,aggressiverefinancingand/orsaleoftheunderlyingproperty.WebelievethatourinvestmentstrategycombinedwiththeexperienceandexpertiseofourManager’smanagementteamprovideopportunitiestooriginateinvestmentswithattractivecurrentandaccruedreturnsandstrongstructuralfeaturesdirectlywithrealestatecompanies,therebytakingadvantageofchangingmarketconditionsinordertoseekthebestrisk-returndynamicforourshareholders.

    OurManager

    FundriseAdvisors,LLC,ourManager,managesourday-to-dayoperations.OurManagerisaninvestmentadviserregistered

    withtheSECandawholly-ownedsubsidiaryofoursponsor.RegistrationwiththeSECdoesnotimplyacertainlevelofskillortraining.Ateamofrealestateanddebtfinanceprofessionals,actingthroughourManager,makesallofthedecisionsregardingtheselection,negotiation,financinganddispositionofourinvestments,subjecttothelimitationsinouroperatingagreement.OurManageralsoprovidesassetmanagement,marketing,investorrelationsandotheradministrativeservicesonourbehalfwiththegoalofmaximizingouroperatingcashflowandpreservingourinvestedcapital.RiseCompaniesCorp.,oursponsor,isabletoexercisesignificantcontroloverourbusiness.

    AbouttheFundrisePlatform

    WearealsoanaffiliateofFundrise,LLC,theownerandoperatorofanonlinefinancialplatformfocusedonrealestate,which

    maybefoundonthewebsite:www.fundrise.com(the“FundrisePlatform”).Fundrise,LLCisawholly-ownedsubsidiaryofRiseCompaniesCorp.,oursponsor.

    BenjaminS.Milleristheco-founderandChiefExecutiveOfficerofRiseCompaniesCorp.,oursponsor.Mr.BenjaminS.

    Millerisresponsibleforoverseeingtheday-to-dayoperationsofRiseCompaniesCorp.anditsaffiliates,includingFundrise,LLC.

    OurStructureThechartbelowshowstherelationshipamongvariousRiseCompaniesCorp.affiliatesandourCompanyasofthedateofthis

    offeringcircular.

    13

  • *Asweraisesufficientofferingproceedstoacquireinvestments,(i)wemayobtainarelatedpartyloanfrom,orissueaparticipationinterestto,FundriseLendingoritsaffiliates,or(ii)FundriseLendingoritsaffiliatesmayacquiresuchinvestmentsandsellthemtousatalatertime.See“PlanofOperation–RelatedPartyLoansandWarehousingofAssets”.

    **Pursuanttoouroperatingagreement,theManagerreceivesanassetmanagementfeeandreimbursementofspecialservicingexpenses.See“ManagementCompensation”.

    ManagementCompensation

    OurManageranditsaffiliatesreceivefeesandexpensereimbursementsforservicesrelatingtoourofferings,andthe

    investmentandmanagementofourassets.Theitemsofcompensationaresummarizedinthefollowingtable.NeitherourManagernoritsaffiliatesreceiveanysellingcommissionsordealermanagerfeesinconnectionwiththeofferandsaleofourcommonshares.See“ManagementCompensation”foramoredetailedexplanationofthefeesandexpensespayabletoourManageranditsaffiliates.

    FormofCompensationandRecipient DeterminationofAmount EstimatedAmount OfferingStage ReimbursementofOfferingExpenses—Manager

    OurManagerhaspaidandwillcontinuetopayofferingexpensesonourbehalfinconnectionwiththeofferingofourshares.WereimburseourManagerforthesecostsandfutureofferingcostsitmayincuronourbehalf.

    OurorganizationandofferingexpensesreimbursedtoourManagerasofDecember31,2018wereapproximately$1,006,000andweexpecttoincuranadditional$45,000inexpensesinconnectionwiththecontinuationofthisoffering.

    14

  • AcquisitionandDevelopmentStage Acquisition/OriginationFee—ManageroritsAffiliate

    Theco-investor,jointventureorborrowerpaysupto2.0%oftheamountfundedbyoursponsororaffiliatesofoursponsortoacquireororiginatecommercialrealestateloansortheamountinvestedinthecaseofotherrealestateinvestments,excludinganyacquisitionandoriginationexpensesandanydebtattributabletosuchinvestments.Wearenotentitledtothisfee.

    Paidbytheco-investors,joint-ventureorborroweratclosing.

    Actualamountsaredependentuponthetotalequityanddebtcapitalweraise;wecannotdeterminetheseamountsatthepresenttime.

    ReimbursementofAcquisition/OriginationExpenses—Manager

    WereimburseourManagerforactualexpensesincurredinconnectionwiththeselection,acquisitionororiginationofaninvestment,totheextentnotreimbursedbytheborrower,whetherornotweultimatelyacquireororiginatetheinvestment.

    Actualamountsaredependentupontheofferingproceedsweraise(andanyleverageweemploy);wecannotdeterminetheseamountsatthepresenttime.

    FormofCompensationandRecipient DeterminationofAmount EstimatedAmount OperationalStage AssetManagementFee—Manager Quarterlyassetmanagementfee

    currentlyequaltoanannualizedrateof0.85%,whichisbasedonourNAVattheendofeachpriorquarter.ThisrateisdeterminedbyourManagerinitssolediscretion,butcannotexceedanannualizedrateof1.00%.Theamountoftheassetmanagementfeemayvaryfromtimetotime,andwewillpubliclyreportanychangesintheassetmanagementfee.

    Actualamountsaredependentupontheofferingproceedsweraise(andanyleverageweemploy)andtheresultsofouroperations;wecannotdeterminetheseamountsatthepresenttime.

    ReimbursementofSpecialServicingExpenses–ManagerorOtherParty

    WereimburseourManagerforactualexpensesincurredonourbehalfinconnectionwiththespecialservicingofnon-performingassets.Whetheranassetisdeemedtobenon-performingisinthesolediscretionofourManager.

    Actualamountsaredependentupontheoccurrenceofanassetbecomingnon-performing,theoriginalvalueofsuchasset,andtheresultsofouroperations;wecannotdeterminetheseamountsatthepresenttime.

    15

  • ReimbursementofOtherOperatingExpenses—Manager

    WereimburseourManagerforout-of-pocketexpensespaidtothirdpartiesinconnectionwithprovidingservicestous.ThisdoesnotincludetheManager’soverhead,employeecostsbornebytheManager,utilitiesortechnologycosts.

    Actualamountsaredependentupontheresultsofouroperations;wecannotdeterminetheseamountsatthepresenttime.

    Theexpensereimbursementsthatwe

    paytoourManageralsoincludeexpensesincurredbyoursponsorintheperformanceofservicesunderthesharedservicesagreementbetweenourManagerandoursponsor,includinganyincreasesininsuranceattributabletothemanagementoroperationofourCompany.

    Liquidation/ListingStage DispositionFees None. —

    SummaryofRiskFactors

    Investinginourcommonsharesinvolvesahighdegreeofrisk.Youshouldcarefullyreviewthe“RiskFactors”sectionofthis

    offeringcircular,beginningonpage26,whichcontainsadetaileddiscussionofthematerialrisksthatyoushouldconsiderbeforeyouinvestinourcommonshares.

    ConflictsofInterest

    OurManageranditsaffiliatesexperienceconflictsofinterestinconnectionwiththemanagementofourbusiness.Someofthe

    materialconflictsthatourManageranditsaffiliatesfaceincludethefollowing:

    · TheassetmanagementfeepaidtoourManagerisbasedonourNAV,whichiscalculatedbyoursponsor’sinternalaccountantsandassetmanagementteam.OurManagermaybenefitbyusretainingownershipofourassetsattimeswhenourshareholdersmaybebetterservedbythesaleordispositionofourassetsinordertoavoidareductioninourNAV.

    · Oursponsor’srealestateanddebtfinanceprofessionalsactingonbehalfofourManagermustdeterminewhichinvestment

    opportunitiestorecommendtousandotherFundriseentities.Oursponsorhasorganized,asofthedateofthisofferingcircular,thefollowingsimilarprograms:

    •FundriseIncomeeREITII,LLC(the“IncomeeREIT®II”),FundriseIncomeeREITIII,LLC(the“IncomeeREIT®III”),FundriseIncomeeREIT2019,LLC(the“IncomeeREIT®2019”),andFundriseIncomeeREITV,LLC(the“IncomeeREIT®V”)whichwereformedtooriginate,investinandmanageadiversifiedportfolioofcommercialrealestateinvestmentsthroughtheacquisitionofcommercialrealestateloans,andwhichhasinvestmentobjectivesandstrategiesthataresimilartoours;

    •FundriseEquityREIT,LLC(the“GrowtheREIT®”),FundriseGrowtheREITII,LLC(the“GrowtheREIT®II”),FundriseGrowtheREITIII,LLC(the“GrowtheREIT®III”),FundriseGrowtheREIT2019,LLC(the“GrowtheREIT®2019”),andFundriseGrowtheREITV,LLC(the“GrowtheREIT®V”)whichwereformedtooriginate,investinandmanageadiversifiedportfolioofcommercialrealestateproperties;

    •FundriseMidlandOpportunisticREIT,LLC(the“HeartlandeREIT®”),whichwasformedtooriginate,investinandmanageadiversifiedportfolioprimarilyconsistingofinvestmentsinmultifamilyrentalpropertiesanddevelopmentprojectslocatedprimarilyintheHouston,TX,Dallas,TX,Austin,TX,Chicago,IL,andDenver,COmetropolitanstatisticalareas;

    •FundriseWestCoastOpportunisticREIT,LLC(the“WestCoasteREIT®”),whichwasformedtooriginate,investinandmanageadiversifiedportfolioprimarilyconsistingofinvestmentsinmultifamilyrentalpropertiesanddevelopmentprojects

  • locatedprimarilyintheLosAngeles,CA,SanFrancisco,CA,SanDiego,CA,Seattle,WA,andPortland,ORmetropolitanstatisticalareas;

    16

  • •FundriseEastCoastOpportunisticREIT,LLC(the“EastCoasteREIT®”),whichwasformedtooriginate,investinandmanageadiversifiedportfolioprimarilyconsistingofinvestmentsinmultifamilyrentalpropertiesanddevelopmentprojectslocatedprimarilyinthestatesofMassachusetts,NewYork,NewJersey,NorthCarolina,SouthCarolina,GeorgiaandFlorida,aswellasthemetropolitanstatisticalareasofWashington,DCandPhiladelphia,PA;•FundriseFor-SaleHousingeFUND–LosAngelesCA,LLC(the“LAHomeseFundTM”),whichwasformedtoacquirepropertyforthedevelopmentoffor-salehousingintheLosAngeles,CAmetropolitanstatisticalarea;•FundriseFor-SaleHousingeFUND–WashingtonDC,LLC(the“DCHomeseFundTM”),whichwasformedtoacquirepropertyforthedevelopmentoffor-salehousingintheWashington,DCmetropolitanstatisticalarea;•FundriseNationalFor-SaleHousingeFUND,LLC(the“NationaleFundTM”),whichwasformedtoacquirepropertyforthedevelopmentoffor-salehousinginthemetropolitanstatisticalareasinwhichoursponsorisnotcurrentlysponsoringanotherregionallyorlocallyfocusedeFundTM,ortoacquireassetsinsuchregionsthatarenotcurrentlythefocusofanothereFundTM;and•FundriseOpportunityFund,LP,whichisaprivateplacementthatwasformedtoacquirepropertieslocatedin“qualifiedopportunityzones”asdesignatedundertheTCJA.

    TheseadditionalFundrisePlatforminvestmentopportunitiesmayhaveinvestmentcriteriathatcompetewithus.

    · Oursponsor’srealestateanddebtfinanceprofessionalsactingonbehalfofourManagerhavetoallocatetheirtimeamongus,

    oursponsor’sbusinessandotherprogramsandactivitiesinwhichtheyareinvolved.

    · Thetermsofouroperatingagreement(includingtheManager’srightsandobligationsandthecompensationpayabletoourManageranditsaffiliates)werenotnegotiatedatarm’slength.

    · OurshareholdersmayonlyremoveourManagerfor“cause”followingtheaffirmativevoteofshareholdersholdingtwo-thirds

    oftheoutstandingcommonshares.Unsatisfactoryfinancialperformancedoesnotconstitute“cause”undertheoperatingagreement.

    · AtsomefuturedateafterwehaveacquiredasubstantialinvestmentportfoliothatourManagerdetermineswouldbemost

    effectivelymanagedbyourownpersonnel,wemayseekshareholderapprovaltointernalizeourmanagementbyacquiringassetsandemployingthekeyrealestateanddebtfinanceprofessionalsperformingservicestousonbehalfofourManagerforconsiderationthatwouldbenegotiatedatthattime.Thepaymentofsuchconsiderationcouldresultindilutiontoyourinterestinusandcouldreducethenetincomepershareandfundsfromoperationspershareattributabletoyourinvestment.Additionally,inaninternalizationtransaction,oursponsor’srealestateanddebtfinanceprofessionalsthatbecomeouremployeesmayreceivemorecompensationthantheypreviouslyreceivedfromoursponsororitsaffiliates.Thesepossibilitiesmayprovideincentivestotheseindividualstopursueaninternalizationtransaction,evenifanalternativestrategymightotherwisebeinourshareholder’sbestinterests.

    · OurManagermay,withoutshareholderconsentunlessotherwiserequiredbylaw,determinethatweshouldmergeor

    consolidatethrougharoll-uporothersimilartransactioninvolvingotherentities,includingentitiesaffiliatedwithourManager,intoorwithsuchotherentities.

    17

  • · Asanon-listedcompanyconductinganexemptofferingpursuanttoRegulationA,wearenotsubjecttoanumberofcorporate

    governancerequirements,includingtherequirementsforaboardofdirectorsorindependentboardcommittees.

    HistoricalNAV

    BelowisthequarterlyNAVpercommonshare,asdeterminedinaccordancewithourvaluationpolicies,foreachfiscalquarterfromthefirstdateitwascalculatedJune30,2016toMarch31,2019.LinkedinthetableistherelevantForm1-UdetailingeachNAVevaluationmethod.

    Date NAVPerShare Link

    June30,2016 $ 9.91Form1-

    U

    September30,2016 $ 9.92Form1-

    U

    December31,2016 $ 9.88Form1-

    U

    March31,2017 $ 9.84Form1-

    U

    June30,2017 $ 9.82Form1-

    U

    September30,2017 $ 9.80Form1-

    U

    December31,2017 $ 9.81Form1-

    U

    March31,2018 $ 9.86Form1-

    U

    June30,2018 $ 9.88Form1-

    U

    September30,2018 $ 9.89Form1-

    U

    December31,2018 $ 9.91Form1-

    U

    March31,2019 $ 9.96Form1-

    U

    DistributionsWhileweareundernoobligationtodoso,wehaveinthepastandexpectinthefuturetodeclareandpaydistributions

    quarterlyinarrears;however,ourManagermaydeclareotherperiodicdistributionsascircumstancesdictate.Inorderthatinvestorsmaygenerallybeginreceivingdistributionsimmediatelyuponouracceptanceoftheirsubscription,weexpecttoauthorizeanddeclaredistributionsbasedondailyrecorddates.

    OnApril12,2016,wepaidourfirstdistributiontoshareholdersofrecordasofthecloseofbusinessoneachdayoftheperiod

    commencingonJanuary1,2016andendingonMarch31,2016.Inaddition,ourManagerhasdeclareddailydistributionsforshareholdersofrecordasofthecloseofbusinessoneachdayfromApril1,2016throughMay31,2019,asshowninthetablebelow.Duringfiscalyear2018,ourdistributionswerefundedfrombothcashflowfromourrealestateinvestmentsandofferingproceedswithamajorityofsuchdistributionsbeingfundedfromourcashflowprovidedbyrealestateinvestments.Seethesectionentitled“DescriptionofOurCommonShares–Distributions”forafullerdescriptionofthedistributionswehavedeclaredand/orpaid.

    DistributionPeriod

    DailyDistributionAmount/Common

    Share Dateof

    Declaration PaymentDate(1) AnnualizedYield

    (2) Link01/01/16–03/31/16 0.0012205045 12/31/15 04/12/16 4.45% 04/01/16–04/30/16 0.0027397254 03/30/16 07/13/16 10.00% 05/01/16–06/30/16 0.0027397260 04/20/16 07/13/16 10.00% Form1-U07/01/16–09/30/16 0.0030136986 06/08/16 10/13/16 11.00% Form1-U10/01/16–12/31/16 0.0030821918 09/16/16 01/13/17 11.25% Form1-U01/01/17–03/31/17 0.0028767123 12/31/16 04/12/17 10.50% Form1-U

  • 04/01/17–06/30/17 0.0028767123 03/21/17 07/13/17 10.50% Form1-U07/01/17–09/30/17 0.0028767123 06/26/17 10/09/17 10.50% Form1-U10/01/17–12/31/17 0.0027397260 09/28/17 01/09/18 10.00% Form1-U01/01/18–01/31/18 0.0016438360 12/22/18 04/11/18 6.00% Form1-U02/01/18–02/28/18 0.0021917808 01/26/18 04/11/18 8.00% Form1-U03/01/18–03/31/18 0.0021917808 02/27/18 04/11/18 8.00% Form1-U04/01/18–04/30/18 0.0021917808 03/28/18 07/09/18 8.00% Form1-U05/01/18–05/31/18 0.0021917808 04/30/18 07/09/18 8.00% Form1-U06/01/18–06/30/18 0.0022602740 05/29/18 07/09/18 8.25% Form1-U07/01/18–07/31/18 0.0023287671 06/28/18 10/08/18 8.50% Form1-U08/01/18–08/31/18 0.0023287671 07/27/18 10/08/18 8.50% Form1-U09/01/18–09/30/18 0.0023287671 08/24/18 10/08/18 8.50% Form1-U10/01/18–10/31/18 0.0023287671 09/26/18 01/07/19 8.50% Form1-U11/01/18–11/30/18 0.0022602740 10/29/18 01/07/19 8.25% Form1-U12/01/18–12/31/18 0.0022602740 11/29/18 01/07/19 8.25% Form1-U01/01/19–01/31/19 0.0021917808 12/27/18 04/10/19 8.00% Form1-U02/01/19–02/28/19 0.0021917808 01/30/19 04/10/19 8.00% Form1-U03/01/19–03/31/19 0.0021917808 02/28/19 04/10/19 8.00% Form1-U04/01/19–04/30/19 0.0021917808 03/28/19 07/21/19 8.00% Form1-U05/01/19–05/31/19 0.0019178082 04/30/19 07/21/19 7.00% Form1-UWeightedAverage 0.0024756710(3) - - 9.04%(4)

    (1)Datespresentedarethedatesonwhichthedistributionswere,orare,scheduledtobedistributed;actualdistributiondatesmayvary.

    (2)Annualizedyieldnumbersrepresenttheannualizedyieldamountofeachdistributioncalculatedonanannualizedbasisatthethencurrentrate,assuminga$10.00persharepurchaseprice.WhiletheManagerisundernoobligationtodoso,eachannualizedbasisreturnassumesthattheManagerwoulddeclaredistributionsinthefuturesimilartothedistributionsforeachperiodpresented,andtherecanbenoassurancethattheManagerwilldeclaresuchdistributionsinthefutureor,ifdeclared,thatsuchdistributionswouldbeofasimilaramount.

    (3)AveragedailydistributionamountpercommonshareiscalculatedastheaverageofthedailydeclareddistributionamountsfromJanuary1,2016throughMay31,2019.

    (4)Averageannualizedyieldiscalculatedastheannualizedyieldoftheaveragedailydistributionamountfortheperiodspresented,assuminga$10.00persharepurchaseprice.WhiletheManagerisundernoobligationtodoso,theaverageannualizedbasisreturnassumesthattheManagerwoulddeclaredistributionsinthefuturesimilartotheaveragedistributionsfortheperiodfromJanuary1,2016throughMay31,2019,andtherecanbenoassurancethattheManagerwilldeclaresuchdistributionsinthefutureor,ifdeclared,thatsuchdistributionswouldbeofasimilaramount.

    18

  • AnydistributionswemakeareatthediscretionofourManager,andarebasedon,amongotherfactors,ourpresentand

    reasonablyprojectedfuturecashflow.DistributionsarepaidtoshareholdersasoftherecorddatesselectedbytheManager.Inaddition,theManager’sdiscretionastothepaymentofdistributionsislimitedbytheREITdistributionrequirements,whichgenerallyrequirethatwemakeaggregateannualdistributionstoourshareholdersofatleast90%ofourREITtaxableincome,computedwithoutregardtothedividendspaiddeductionandexcludingnetcapitalgain.Moreover,evenifwemaketherequiredminimumdistributionsundertheREITrules,wearesubjecttoU.S.federalincomeandexcisetaxesonourundistributedtaxableincomeandgains.Asaresult,theManagerintendstocontinuetomakeadditionaldistributions,beyondtheminimumREITdistribution,toavoidsuchtaxes.See“DescriptionofOurCommonShares—Distributions”and“U.S.FederalIncomeTaxConsiderations”.

    AnydistributionsthatwemakedirectlyimpactsourNAV,byreducingtheamountofourassets.Ourgoalistoprovidea

    reasonablypredictableandstablelevelofcurrentincome,throughquarterlyorotherperiodicdistributions,whileatthesametimemaintainingafairlevelofconsistencyinourNAV.Overthecourseofyourinvestment,yourdistributionsplusthechangeinNAVpershare(eitherpositiveornegative)willproduceyourtotalreturn.

    Ourdistributionswillgenerallyconstituteareturnofcapitaltotheextentthattheyexceedourcurrentandaccumulated

    earningsandprofitsasdeterminedforU.S.federalincometaxpurposes.TotheextentthatadistributionistreatedasareturnofcapitalforU.S.federalincometaxpurposes,itwillreduceaholder’sadjustedtaxbasisintheholder’sshares,andtotheextentthatitexceedstheholder’sadjustedtaxbasisitwillbetreatedasgainresultingfromasaleorexchangeofsuchshares.

    DistributionSupportCommitment

    Toprovideshareholderswithdistributionsbeforewehadacquiredasubstantialportfolioofincome-producinginvestments,

    Fundrise,LP,anaffiliateofoursponsor,agreedtopurchaseadditionalcommonsharestosupportourquarterlydistributionpaymentsundercertaincircumstances(the“distributionsupportcommitment”)pursuanttoadistributionsupportagreement.inanycalendarquarterduringthedistributionsupportperiodwerelessthantheamountthatwouldproducea15%annualizedreturn,thenFundrise,LPwasobligatedtopurchasesharesfollowingtheendofsuchquarteratthethenNAVpershareforanaggregatepurchasepriceequaltotheamountbywhichouroperatingresultswerelessthanthe15%annualizedamount.Thedistributionsupportcommitmentwastobeinplaceuntil(i)thepurchasebyFundrise,LPofanaggregateof$1,000,000incommonsharesor(ii)December31,2017,whicheverwasearlier(the“distributionsupportperiod”).

    AsofFebruary14,2017,Fundrise,LPhaspurchased100,000commonsharesinsatisfactionofitsdistributionsupportcommitment,thussatisfyingitsobligationsunderthedistributionsupportcommitment.Accordingly,Fundrise,LPisnolongerobligatedtopurchaseanyadditionalsharespursuanttothedistributionsupportcommitment.

    19

  • FormoreinformationregardingFundrise,LP’sdistributionsupportcommitmentandourdistributionpolicy,pleasesee

    “DescriptionofOurCommonShares—Distributions—DistributionSupportCommitment”.

    BorrowingPolicyWemayemployconservativelevelsofborrowinginordertoprovideadditionalfundstosupportourinvestmentactivities,

    althoughasofDecember31,2018,wehavenotutilizedanyleverage.Ourtargetportfolio-wideleverageisbetween50-85%ofthegreaterofcost(beforedeductingdepreciationorothernon-cashreserves)orfairmarketvalueofourassets.Duringperiodswhenwearesignificantlygrowingourportfolio,wemayemploygreaterleverageonindividualassets(thatwillalsoresultingreaterleverageoftheportfolio)inordertoquicklybuildadiversifiedportfolioofassets.OurManagermayfromtimetotimemodifyourleveragepolicyinitsdiscretioninlightofthen-currenteconomicconditions,relativecostsofdebtandequitycapital,marketvaluesofourproperties,generalconditionsinthemarketfordebtandequitysecurities,growthandacquisitionopportunitiesorotherfactors.However,otherthanduringaperiodwhenwearesignificantlygrowingourportfolio,itisourpolicytonotborrowmorethan75%ofthegreaterofcost(beforedeductingdepreciationorothernon-cashreserves)orfairmarketvalueofourassets.WecannotexceedtheleveragelimitofourleveragepolicyunlessanyexcessinborrowingoversuchlevelisapprovedbyourManager’sinvestmentcommittee.See“InvestmentObjectivesandStrategy”formoredetailsregardingourleveragepolicies.

    ValuationPolicies

    Attheendofeachfiscalquarter,oursponsor'sinternalaccountantscalculateourNAVpershareusingaprocessthatreflects(1)

    estimatedvaluesofeachofourcommercialrealestateassetsandinvestments,includingrelatedliabilities,basedupon(a)marketcapitalizationrates,comparablesalesinformation,interestrates,netoperatingincome,(b)withrespecttodebt,defaultrates,discountratesandlossseverityrates,(c)forpropertiesthathavedevelopmentorvalueaddplans,progressalongsuchdevelopmentorvalueaddplan,and(d)incertaininstancesreportsoftheunderlyingrealestateprovidedbyanindependentvaluationexpert,(2)thepriceofliquidassetsforwhichthirdpartymarketquotesareavailable,(3)accrualsofourperiodicdistributionsand(4)estimatedaccrualsofouroperatingrevenuesandexpenses.Forjointventureordirectequityinvestments,thesponsorprimarilyreliesondiscountedcashflowmethod.Underthediscountedcashflowmethod,ourassetmanagementteamwillcalculatethedistributionsduetotherespectiveinvestmentbasedonaproperty-levelproformameasuredagainstongoingactualperformanceoveratheprojectedlikely-holdperiod.Thesponsor’sassetmanagementteamwillthendiscountfuturecash-flowprojectionsatanappropriatemarketlevered-discountratetodeterminepresentvalue,whichvalueisconsideredthenetassetvalueoftheinvestment.Thesponsormayalternativelyapplythehypotheticalsalesmethodtovalueitsinvestments.Underthisapproach,oursponsor’sassetmanagementteamwillassume(i)thesaleofthepropertyatapriceequaltotheconcludedpropertyvalue,(ii)theliquidationofanyadditionalassetsafterpayingallliabilities,and(iii)thedistributionofthenetsaleproceedstoinvestors.Thedistributedamountisconsideredthenetassetvalueofeachrespectiveinvestment.Fordebtandfixed-returnpreferredequityinvestment,assumingnomaterialadversechangeintheproperty,thesponsor’sassetmanagementteamwillmarktheseinvestmentstotheircostbasis(includinganyaccruedunpaidinterest).Ifthereweretobematerialadversechangesintheseproperties,theassetmanagementteamintendstovaluetheseinvestmentsusingthehypotheticalsalesmethoddescribedabove.Forourinvestmentsthathaveclosedwithinthreetoninemonthsandnomaterialchangeshaveoccurredfromtheoriginalunderwriting,ourassetmanagementteamwilltypicallyapplytheoriginalpropertypurchaseprice(orpre-closingthirdpartyappraisalvalue)forthepropertyvaluation,andtheinvestmentcostbasisfortheinvestmentlevelvaluation.

    Note,however,thatthedeterminationofourNAVisnotbasedon,norintendedtocomplywith,fairvaluestandardsunder

    GAAP,andourNAVmaynotbeindicativeofthepricethatwewouldreceiveforourassetsatcurrentmarketconditions.Ininstanceswherewedetermineanappraisaloftherealestateassetisnecessary,including,butnotlimitedto,instanceswhereourManagerisunsureofitsabilityonitsowntoaccuratelydeterminetheestimatedvaluesofourcommercialrealestateassetsandinvestments,orinstanc


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