DiversyFund in 2026: One REIT Winding Up on $87,920 of Cash, One Worth $4.12 on a $10 Share

Why this is worth writing down

DiversyFund stopped being a news story a while ago. The SEC matter is four years old, the coverage moved on, and the company's investors were left with the hardest kind of uncertainty, which is the quiet kind.

But the filings never stopped. Regulation A issuers must file an audited annual report every year, and DiversyFund's arrived on April 27 and May 1, 2026. They are free to read, they are audited, and nobody appears to have gone through them. This article does exactly one thing: it reports what they say.

Our DiversyFund review covers the history and the enforcement action. This is the current financial state.

Growth REIT I: the wind-down is now official

The most important sentence in the whole filing is a plain one: "The Company is now in its winding up period."

The LLC agreement provided a five-year term with up to two one-year extensions. The manager used both, carrying the term to December 31, 2025. That date has passed. What follows, in the filing's own words, is that the manager "will seek to generate liquidity for investors and realize any gains in the value of our investments by selling or refinancing our properties and returning capital to investors on an orderly basis over the approximate 12 to 24+ month winding up period."

Read literally, that puts a return of capital somewhere between the end of 2026 and the end of 2027, with the "+" doing real work. The stated goal is "to preserve capital and maximize Investors' potential profits by waiting for local market conditions to reach favorable pricing levels," and the filing is careful to add that "sales will be subject to prevailing market conditions and there is no guarantee" of success.

The balance sheet the wind-down starts from

Three lines deserve attention, and they do not all point the same way.

Rental revenue grew 27.9%, from $8.21M to $10.50M, and the annual loss narrowed by roughly $1.9M. The underlying properties are producing more rent than they were, which is a genuinely positive operational fact and should be said plainly.

Cash fell 95.5%, from $1,953,984 to $87,920. A fund entering a wind-down with under $88,000 of cash against a $91M balance sheet has very little margin for a slow sale, an unexpected capital expenditure, or a lender negotiation that takes longer than planned.

Interest payable rose from $11,235 to $1,207,504, roughly 107 times, while notes payable grew by $3.16M. Interest payable is interest that has been incurred but not yet paid. A jump of that size on a portfolio the manager describes as having "experienced operating deficits as a result of rising interest expenses stemming from the Federal Reserve Bank's multiple interest rate increases in 2022, 2023 and 2024" is the clearest single indicator in the document of how tight the position is.

The fee that runs during a liquidation

Worth knowing before the sales start: the filing's own compensation table shows that in the liquidation stage the sponsor is entitled to a disposition fee of 1% of the property sale price, plus a "Promoted Interest" in distributions from capital transactions. There is nothing unusual or improper about a disposition fee. But it does mean the sponsor earns on each sale during the wind-down, whether or not the sale returns capital to investors, and an investor reading a sale announcement should know that.

Growth REIT II: a $10 share carried at $4.12

Growth REIT II is a smaller and structurally different vehicle. It is essentially unleveraged: total liabilities of $130,443 against $4,801,465 of assets. There is no debt wall here.

What there is instead is a straightforward decline in carrying value.

The arithmetic closes exactly: equity of $5,436,793 at the end of 2024 minus the $765,771 net loss gives $4,671,022, which is assets minus liabilities to the dollar. You can check it yourself in the statement of members' equity.

What is driving the loss matters. Operating expenses are tiny, $71,797 of general and administrative costs for the year, and fund management fees of $0. Almost the entire loss is an unrealized investment loss of $761,331, which is a writedown in the carrying value of the projects rather than cash going out of the door. That is a meaningfully different thing from a fund burning money on overheads, and anyone reading "net loss" as "spent your money" would be misreading it.

The term of REIT II was extended by one year to December 31, 2026, with the same 12 to 24 month wind-down language to follow. So REIT II is roughly one year behind REIT I on the same path.

The third REIT never got off the ground

On February 12, 2026, Value Add Growth REIT IV filed a Form 1-A-W to withdraw the offering statement it had first filed a year earlier, on February 6, 2025. The stated reason is that "REIT IV has determined it is not in its best interests to continue with this Offering Statement," and the filing confirms that none of the securities have been sold.

Nothing about a withdrawal is inherently alarming. Issuers pull offerings for many ordinary reasons. But taken with the other two filings it completes the picture: the flagship fund is winding up, the second fund is carried at 41% of contributed capital with no distributions declared since 2022, and the newest fund was withdrawn without raising a dollar.

On the SEC matter, in the company's own words

Because this comes up in every discussion of DiversyFund, here is how Growth REIT II's FY2025 filing itself describes it, and I am quoting the company's characterisation rather than endorsing it.

The filing states the company was a respondent in an SEC administrative proceeding; that the SEC began an investigation in November 2021 and initiated a related enforcement action in February 2022; and that the SEC alleged failures to comply with "two technical requirements of Regulation A", specifically not beginning the offering within two calendar days of qualification, and using an offering circular supplement rather than a post-qualification amendment to raise the maximum offering from $50 million to $75 million, along with inaccurate statements on the company's website.

The filing then asserts: "None of the SEC's complaints alleged any intentional wrongdoing or financial or accounting violations, and accurate information about the offering was available to investors at all times."

That is the issuer's framing, in its own audited annual report. It is also the reason REIT II's offering was suspended after raising $11.3M of a targeted $50M.

What an investor can actually do with this

1. Read your own fund's filing. Growth REIT I is CIK 1750695, Growth REIT II is CIK 1824154, on SEC EDGAR. They are different vehicles with very different balance sheets, and platform-level commentary, including this article, is no substitute for the one that holds your money.
2. Expect the wind-down to take the stated time, and possibly longer. "12 to 24+ months" from December 31, 2025 means realistically 2027 for REIT I, and the manager has explicitly said sales depend on market conditions.
3. Book value is not a redemption price. $4.12 per share on REIT II is a carrying value in an audited statement, not an amount anyone is offering you. There is no redemption programme and no secondary market.
4. Watch the interest payable line next year. On REIT I it is the number that will tell you soonest whether the debt position is stabilising or tightening, faster than the loss line will.
5. If you are choosing where to put new money, judge the exit first. That is the whole lesson of this category in 2026, and we rank platforms on exactly that axis in Cardone Capital Alternatives and the liquidity ranking.

Sources

• DF Growth REIT, LLC, Form 1-K for FY2025, filed May 1, 2026 (CIK 1750695)
• DF Growth REIT II, LLC, Form 1-K for FY2025, filed April 27, 2026 (CIK 1824154)
• Value Add Growth REIT IV, LLC, Form 1-A-W, offering withdrawal filed February 12, 2026 (CIK 1949029)
• DF Growth REIT II, LLC, Form 1-K for FY2023, filed July 11, 2024 (CIK 1824154), the source for the $291,160 of distributions declared in 2022

Internal links: DiversyFund Review · Cardone Capital Alternatives · What Landa Investors Actually Got Back · Real Estate Crowdfunding Liquidity 2026 · Real Estate Crowdfunding Failures · Red Flags in SEC Filings

Last updated: September 12, 2026. Every figure is transcribed from the SEC filings linked above and the percentages and per-share values are our arithmetic, shown so they can be checked. Descriptions of the SEC matter are the issuer's own characterisation as recorded in its audited annual report, not our assessment and not findings of fact. We have no position in any DiversyFund vehicle, no relationship with the company, and earn nothing from this page. This is analysis, not investment advice.