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What's our story?
Socotra Capital currently manages over $500 million in first lien loans secured by real estate and real estate holdings all across the country. Since 2007, Socotra Capital has funded more than 1,750 private money loans on commercial and residential properties, totaling over $1 Billion in loans funded. Socotra Capital is the acting manager of the Socotra Fund and the Socotra Opportunity Fund, two mortgage pools that provide capital for the majority of transactions.
To read the complete story of Socotra Capital, including how we started with our very first loan in 2007 and what our vision is for the future, we invite you to read The Socotra Story. This document also provides a detailed look at our investment products and the values that guide our firm.
The Socotra Fund
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The Socotra Fund, LLC focuses on cash flow through first deeds of trust on properties with a significant equity hedge. Structured much like a mutual fund, investor funds are pooled collectively in a portfolio of private money loans. The loans are diversified across numerous locations, property types, and borrowers, mitigating risk and protecting against exposure to regional market downturns. Socotra Capital's investment opportunities include stabilizing commercial real estate properties, financing fix-and-flip residential projects, providing funding for quick escrow closures, and cash-out refinancing for business needs.
The Socotra Fund currently holds more than $250 million in loans secured by residential and commercial properties, with a targeted investor yield of 7% to 8%. The Fund does not rely on any leverage, providing increased stability and security by ensuring investor returns are not amplified in a downward market cycle. As of November 1, 2019, the Socotra Fund officially established a subsidiary Real Estate Investment Trust (REIT) as the official lender on all of its loans.
Residential loans are primarily comprised of single-family residential loans, while commercial loans are a blend of mixed-use, multi-tenant, and industrial buildings. The Fund’s managers monitor and may advance property taxes and insurance policies on the portfolio of loans. To ensure the security of the Fund’s investors, the Fund requires the use of independent third-party appraisals to determine property values, in addition to underwriting each borrower’s desired use of funds.
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80.7% *As of Jun 30, 2025 |
48.3% Loan To Value *As of Jun 30, 2025 |
7.5% Trailing 12 Months *As of Jun 30, 2025 |
7.8% Yield - Reinvest *As of Jun 30, 2025 |
The Socotra Opportunity Fund II
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The Socotra Opportunity Fund II, LLC focuses on capital appreciation and cash flow, primarily by investing in performing and nonperforming first deeds of trust on properties with a significant equity hedge. Structured much like a mutual fund, funds are collectively invested in a diversified portfolio of private money loans, spread across various locations, property types, and borrowers. In select cases, the Opportunity Fund II considers equity and second deeds of trust if there is a significant opportunity in relation to the risk.
Targeted investment opportunities include stabilizing commercial real estate property, financing fix-and-flip residential projects, providing funding for rapid escrow closures, and cash-outs for business needs. The Socotra Opportunity Fund II currently holds over $10 million in capital and is designed to take advantage of higher-risk investments than the more conservative Socotra Fund. This higher risk tolerance delivers a correspondingly higher yield target of approximately 8% to 10%, compared to the Socotra Fund’s annual yield of 7% to 8%.
Launched in 2024 following the closure of the Socotra Opportunity Fund, Socotra Opportunity Fund II has distributed cash flow every month, primarily due to a careful balancing of long- and short-term goals. Capital appreciation is the Fund’s long-term goal. The short-term goal for this economic cycle is to maintain the Fund's yield target of 8%-10% while adhering to an LTV target of less than 50%. At the beginning of the next anticipated market cycle, the Fund is expected to outperform the market and capitalize on premium opportunities, purchasing nonperforming notes and properties on courthouse steps at steep discounts.
Effective 2025, the Socotra Opportunity Fund II officially established a subsidiary Real Estate Investment Trust (REIT) as the official lender on all of its loans.
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100% *As of Jun 30, 2025 |
50.8% Loan To Value *As of Jun 30, 2025 |
7.4% Trailing 12 Months *As of Jun 30, 2025 |
7.4% Yield - Reinvest *As of Jun 30, 2025 |
The Herzer Financial Mortgage Fund
The Herzer Financial Mortgage Fund, LLC (Herzer Fund), focuses on consistent cash flow by investing in trust deeds secured by properties with a significant equity hedge. Similar in format to a mutual fund, investor capital is pooled collectively and invested in a portfolio of private money loans, which include ground-up construction loans, bridge loans, fix-and-flip residential projects, consumer bridge loans, business-purpose loans, and cash-out refinances for business purposes.
The Herzer Fund presently holds more than $65 million of investor capital. Investments in the fund are subject to a 12-month lockup period, with liquidity becoming available on an annual basis. The Herzer Fund targets a yearly yield of 7% to 8%. As of Sep 1, 2023 the Herzer Fund officially established a subsidiary Real Estate Investment Trust (REIT) as the official lender on all of its loans.
Investor returns were generated in the past with a high degree of consistency—even amid turbulent economic developments, such as the global financial crisis of 2008—all while subjecting investors to minimal risk. The Herzer Fund practices disciplined underwriting and seeks opportunities where there is ample equity cushion to minimize negative impacts during any downward market cycle. The Fund’s managers monitor and advance all property taxes and insurance policies on the portfolio of loans. To ensure the security of the Fund’s investors, the Fund requires the use of independent third-party appraisals to determine property values, in addition to underwriting each borrower’s desired use of funds.
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98.5% *As of Jun 30, 2025 |
51.3% Loan To Value *As of Jun 30, 2025 |
7.7% TTM Yield *As of Jun 30, 2025 |
8.0% TTM Rate of Return *As of Jun 30, 2025 |
The Private Client Group
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The Socotra Private Client Group focuses on first lien loan opportunities secured by properties with a significant equity hedge. As a member of the Socotra Private Client Group, individuals invest alongside The Socotra Fund, The Socotra Opportunity Fund, and Herzer Financial Mortgage Fund, as well as other members of the Private Client Group, who hold individual titles on the note. The Socotra Private Client Group is composed of champion investors who have qualified to invest in these select individual loan opportunities.
These loan opportunities have been selected as offerings exclusive to the Private Client Group due to a need to limit various risk factors within our fund offerings, even though these loans meet the Fund’s investment criteria. These risk factors include, but are not limited to, loan concentration on an individual property, borrower concentration, geographical concentration, and other risks where having partners on the note mitigates and protects against exposure to regional market downturns. The Socotra Private Client Group offers investment opportunities that include stabilizing commercial real estate properties, financing fix-and-flip residential projects, providing funding for quick escrow closings, and cash-out refinancing for business needs.
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