Private Real Estate Debt Due Diligence Checklist

Why a structured checklist helps

Private real estate debt strategies can differ widely from one another. Two funds that both describe themselves as investing in trust-deed loans may take very different approaches to lien position, borrower quality, property type, and how they respond when a loan stops performing. Marketing summaries rarely surface these differences. A structured checklist can help you compare programs on the same terms and identify the questions that matter most for your own circumstances.

Working through each category in turn can also make it easier to notice what is missing. When a disclosure document is quiet on a particular topic, that absence is often as informative as the details it does provide. The checklist is intended to prompt questions, not to supply answers, and it is not a substitute for your own review or for advice from your own legal, tax, and financial professionals.

What the checklist covers

The checklist groups its questions into the categories that most commonly shape the risk and return profile of a private real estate debt fund. Each category is presented as a set of questions you can raise with a fund's manager and cross-check against its offering documents:

• Manager and track-record verification: who manages the fund, what relevant experience they hold, and how their history can be independently confirmed rather than accepted on assertion.
• Loan underwriting, loan-to-value, and protective equity: how the manager sizes loans against property value, and how much cushion, or protective equity, is intended to sit between the loan balance and the value of the collateral.
• Lien position: whether the fund holds first-position or second-position security, and what subordination to a senior lender can mean for recovery if a borrower defaults.
• Collateral and valuation: what types of property secure the loans, how those properties are valued, and how often valuations are refreshed.
• Default and workout process: what happens when a borrower stops paying, including the fund's approach to forbearance, foreclosure, and the costs and timelines those processes can involve.
• Reporting and transparency: what information investors receive, how often it arrives, and whether it covers loan-level detail or only fund-level summaries.
• Liquidity and redemption terms: whether and when an investor may request a return of capital, and the conditions or restrictions that can apply to private notes that have no public market.
• Fees and conflicts of interest: how the manager is compensated, and where the manager's incentives may diverge from those of investors.
• Legal and offering documents: which documents govern the investment, what disclosures they contain, and why reading them in full matters before any decision is made.

How to use the checklist

The checklist is most useful when applied consistently and paired with primary source documents. Rather than relying on a summary, you can read the fund's private placement memorandum, note agreement, and related disclosures alongside the checklist, noting where your questions are answered clearly, where they are answered only in part, and where they are not addressed at all.

Because every investor's situation is different, the weight you give to each category is a personal judgment. Someone focused on the timing of capital return may pay close attention to liquidity and redemption terms, while someone focused on downside scenarios may concentrate on lien position and the default and workout process. The checklist does not prescribe priorities; it simply helps ensure the questions are on the table.

Who can request the checklist

Evoque Fund offers promissory notes through a private placement under Regulation D, and those Notes are available only to accredited investors. The checklist is provided in the same educational spirit and is intended for accredited investors who are researching private real estate debt. Requesting it is an information step and a way to learn more about the diligence process and about the Fund's offering materials.

Request the checklist and offering overview

To receive the Private Real Estate Debt Due Diligence Checklist along with the Evoque Fund offering overview, use the contact form on this page. The Evoque Fund team can then share the educational materials. You can also reach the Fund by phone at 1-800-505-8121, or by mail at 9440 Santa Monica Blvd., Suite 301, Beverly Hills, CA 90210.

Download the full checklist (PDF)

Request the complete Private Real Estate Debt Due-Diligence Checklist as a PDF. It is provided for general educational purposes only and is not an offer, a solicitation, or investment, legal, or tax advice.

Risks and limitations

Investing in private real estate debt involves substantial risk, including the possible loss of the amount invested. Consider at least the following before requesting information:

• Private real estate debt carries the risk of borrower default. If a borrower fails to repay, a fund may need to pursue foreclosure or a workout, processes that can be lengthy and costly and that may not recover the full loan balance.
• The value of the real estate securing a loan can decline. If collateral values fall, the protective equity cushion may narrow or disappear, which can reduce the amount recovered in a default.
• Second-position loans are subordinate to senior lenders. Where a fund holds a junior lien, a senior lender is generally repaid first from any recovery, which can leave less, or nothing, for the junior position.
• Private notes are illiquid and have no public trading market. An investor may be unable to sell or redeem a Note when desired, and redemption terms, where offered, can be limited or restricted.
• Outcomes depend heavily on the manager. Results rely on the manager's underwriting, servicing, and workout decisions, and there is no assurance those decisions will produce favorable results.
• This checklist is educational and does not replace professional advice or a full review of the offering documents. Past market and lending conditions do not predict future results, and no diligence process can eliminate the risk of loss.

Frequently Asked Questions

Is the checklist investment advice?

No. The checklist is an educational framework of questions to consider. It does not recommend any investment or tell you what to do with your capital, and it is not a substitute for advice from your own legal, tax, and financial professionals.

Who can request the checklist?

The checklist is intended for accredited investors researching private real estate debt. Evoque Fund's Notes are offered only to accredited investors in reliance on an exemption from registration under Regulation D.

Does requesting the checklist commit me to anything?

No. Requesting the checklist is an information step. It is a way to receive educational materials and the offering overview so you can review them on your own timeline.

What documents does the checklist point me toward?

It encourages reading a fund's primary offering materials, such as the private placement memorandum and the note agreement, in full, and using the checklist to track which of your questions those documents answer.

Continue learning

For further reading on evaluating private funds and real estate debt, the following Evoque Fund Insights may be helpful.

Important information

For accredited investors only. Evoque Fund, LLC offers promissory notes through a private placement under Regulation D. The Notes are offered only to investors who qualify as “accredited” under applicable SEC rules. Nothing on this page is an offer to sell or a solicitation of an offer to buy any security; any offer is made solely through the Fund’s confidential offering documents.

This page is educational and is not investment, legal, or tax advice. It does not describe specific returns, fees, or terms. The SEC has not approved or endorsed this offering. Requesting information does not create an investment account, reserve or accept you into the offering, confirm your accredited status, or obligate you or the Fund in any way. Review the Fund’s SEC Form D and offering documents, and consult your own advisors, before making any investment decision.