All Forum Posts by: Brett Henricks

The feedback I have from investors who have visited the Versity/Crew offices is you won't be welcome and they are sparsely populated. I'd still do it, however.

I'd recommend you check out this link on Reddit that was recently posted. It brings a lot of clarity to the situation the investors face.

https://www.reddit.com/r/realestateinvesting/comments/1ff1ew...

Right now the best strategy maybe getting investors to file a complaint with the SEC. If enough of them do and Versity/Crew is scrutinized by the SEC then investors may benefit.

Hi Victor, which properties do you have an investment in? What can you tell us about them?

Steve Cameron's post from a day ago with the link to Reddit is huge. Everyone should read it, please!

This Reddit poster has confirmed what a lot of us have suspected. It also has detailed information on the potential SEC violations.

Unfortunately for Crew investors the 721 UPREIT angle is another strategy to make them have some hope of getting their money back. Crew dangled the 721 UPREIT out there at the end of 2024 for investors in their student housing properties. They explained they had secured financing to make it happen and investors would be contacted in January of 2025 about their choice to join the UPREIT or get their money back so they could 1031 into another investment. Never happened. When I pursued this through my broker as to what's going on, Crew explained the UPREIT would only be one property potentially at the end of 2025. Really something to think about, a REIT with one property in it? Crew put it in more than one communication and then it went completely silent. Really more bait and switch.

The next problem investors face is that Crew's loans on the properties that I am aware of amortize in 6 years, i.e. they have to start paying principal. This was in the PPM. In the case of my two properties this happens in 2026. So the 1% and 1.7% distribution they restarted paying in 2025 will likely vanish. Pursuing Crew for an explanation they said at that point they would just sell the property. I have little faith that they can pull that off. In the case of one investor that I spoke with he did not get all his principal back when Crew did sell his property. 

Tell us more about receivership, how would you make that happen?

Here again are the 14 properties where Versity/Crew has either suspended distributions or restarted them an extremely reduced rate.

Astoria- Celebration FL Apex- Orlando FL Hayworth Tanglewood- Houston TX

Inspire on 22nd- Austin TX CP Cincy- Cinn. OH Oakbrook- Baton Rouge, LA

Shadow Glen- Manor TX The Element- Sacramento CA The Walk- Tuscaloosa AL

Wolf Run- Reno NV Vintage Horizon West- Winter Garden FL AW Newport- Tempe AZ

4 & J- San Diego CA   The Buckingham- Chicago IL

At this point it's really going to depend on your property. I've only spoken to one investor that complained that Crew was running their property into the ground. I have had a lot of investors say they don't understand because their property is 90% occupied. So, in most cases your Crew property is a going concern and your damage is the missed distributions. You have your share of the asset intact. Hopefully.

Crew has many of their properties that amortize after 6 years, i.e. they have to start paying principal. If they are paying any distributions at all or none they quite possibly won't be able to cover the additional cost. They could be faced with having to sell these properties. I know of quite a few that amortize starting in 2026. At that point they will be selling a significant amount of property into whatever the market is at the time. Crew investors could benefit or suffer depending on how those property sales go.

We need more investors to come forward. Please encourage any Crew investor you know to reach out so we can share your story.

The purpose of my original post and all subsequent posts was never to hold an investment seminar or dole out investment advice. The sole purpose was to connect with other Versity/Crew Enterprises investors who had their distributions suspended or some other kind of distress. To that extent Bigger Pockets has been an excellent venue for that. Originally I knew of 3 properties with suspended distributions. I have now connect with one or more investors in 14 Versity/Crew Enterprises properties. Thank you all for sharing your experiences. Besides other distressed investors I have heard from attorneys, Broker Dealers and RIA's. All of which has been much appreciated. To that extent I am still wanting to hear from Versity/Crew Enterprises investors with suspended distributions. Here are 11 Versity/Crew Enterprises properties that I have not heard from other investors about. I'm told that all have suspended distributions or are in distress. Please reach out if you are an investor in any of these properties or any of the 14 properties already identified in this post.

345 Flats, Kent OH       9 X 9, Provo UT    900 Factory, Logan UT     Campus Walk, Chico CA     

Milano Flats, Rexburg ID        One on 4th, Stillwater OK         Rockland, Lawrence KN

Tailor Lofts, Chicago IL          The Nine, Memphis TN           The Ridge, Morgantown WV

University Park, Berkeley CA

My Crew Enterprises property Inspire on 22nd in Austin has restarted distributions this month at 1.0%. Compared to the promised 5.34% I am underwhelmed. What to do with all that money? Last month they restarted my other property Wolf Run in Reno at 1.73%. I should be happy since at least it's something for the moment.

I say for the moment because both of these properties Amortize in 2026. I have no confidence that Crew can pay the principal that they then owe.

The feedback from my BD's from Crew is that they will sell the properties at that point. We will see if they can actually pull that off or it's just another empty Crew promise. If they do pull it off, at what price do they do it? Will it be enough to make investors whole and also pay the missed distributions accruing at 2%. I spoke to one investor that Crew did sell the property. He did not get all his principal back.

Here you go for the owners of the 14 properties I have heard from Crew Enterprises/Versity investors with suspended distributions the lawsuit where the principals of Versity and now Crew are suing each other over siphoning off your distributions.

On July 27, 2023, Brian Nelson formally issued a written demand to Blake Wettengel and Tanya Muro, requesting the following information and actions:

Accounting Records: An electronic copy of all accounting books and records of Versity I, from their inception to the present, including the general ledger and all other accounting files. ​

Original Documents: The original of each document or agreement in their possession bearing Nelson’s original-ink signature, to which Versity I is a party. ​

Tax Returns: A full and complete copy of all state and federal income tax returns for Versity I and related entities. ​

Financial Statements: A full and complete copy of all annual financial statements, including but not limited to income statements and balance sheets, for the time period January 1, 2018 through December 31, 2022, and for January 1, 2023 to the present, for Versity I. ​

Organizational Documents: A copy of the operating agreement, limited liability company agreement, or other organizational agreement, and all amendments thereto, or other organizational documents if any, of Versity I. ​

Additionally, Nelson demanded that Wettengel and Muro take the following actions:

Resignation: Resign from any alleged positions they held with Versity I. ​

Return of Funds: Return all wrongfully diverted funds. ​

Bank Accounts: Resign from all bank accounts. ​

Cease Transfers: Refrain from transferring any more money to themselves. ​

Asset Disposal: Stop disposing of assets. ​

Unfortunately, Wettengel and Muro ignored these demands and did not provide the requested information or take the necessary actions. ​

Please let me know if you need any further details or have any questions regarding this matter.

He also stated : On or around August 15, 2023, Blake Wettengel and Tanya Muro suspended investor payments that they were required to make each month. ​ Instead, they began transferring funds to themselves or their entities under the guise of alleged overdue management fees. ​ These transfers were a pretext and were done to damage Brian Nelson and the investors in the properties managed by Versity I. ​ The actions were taken in retaliation for Nelson asserting his rights.

Eric, thanks for the feedback you sent in your e-mail. Looks like the following:

Proforma NOI $6M, actual NOI $3.9M. Proforma NI $3M, actual NI $400k. 87% off of the Proforma.

Proforma Operating Income $8.7M, actual $7.1M. 

NI of $400k unlikely to support resumption of distributions. Currently there are $8.44M in deferred distributions which would be paid last upon a sale of the property.

I continue to hear stories like this from Versity/Crew Enterprises investors, I am interested in yours. Please reach out.