10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 30, 2020

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 000-55780

Terra Secured Income Fund 5, LLC

(Exact name of registrant as specified in its charter)

Delaware	90-0967526
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

550 Fifth Avenue, 6^th Floor

New York, New York 10036

(Address of principal executive offices) (Zip Code)

(212) 753-5100

(Registrant’s telephone number, including area code)

Securities registered pursuant to section 12(b) of the Securities Exchange Act of 1934:

None

Securities registered pursuant to section 12(g) of the Securities Exchange Act of 1934:

Units of Limited Liability Company Interests

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☑	Smaller reporting company	☑
		Emerging growth company	☑

        If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☑

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

As of August 10, 2020, the registrant had 6,637.7 units of limited liability company interests outstanding. No market value has been computed based upon the fact that no active trading market had been established as of the date of this document.

TABLE OF CONTENTS

		Page
PART I	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Statements of Financial Condition as of June 30, 2020 (unaudited) and December 31, 2019	2
	Statements of Operations for the Three and Six Months Ended June 30, 2020 and 2019 (unaudited)	3
	Statements of Changes in Members’ Capital for the Three and Six Months Ended June 30, 2020 and 2019 (unaudited)	4
	Statements of Cash Flows for the Six Months Ended June 30, 2020 and 2019 (unaudited)	5
	Schedules of Investment as of June 30, 2020 (unaudited) and December 31, 2019	6
	Notes to Financial Statements as of June 30, 2020 (unaudited)	14
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 4.	Controls and Procedures	39
PART II	OTHER INFORMATION	39
Item 1.	Legal Proceedings	40
Item 1A.	Risk Factors	40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 3.	Defaults upon Senior Securities	42
Item 4.	Mine Safety Disclosures	42
Item 5.	Other Information	42
Item 6.	Exhibits	43
Signatures		44

1

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

Terra Secured Income Fund 5, LLC

Statements of Financial Condition

	June 30, 2020		December 31, 2019
	(unaudited)
Assets
Equity investment in Terra JV, LLC at fair value (cost of $238,509,445 and $0, respectively)	$	238,509,869	$	—
Equity investment in Terra Property Trust, Inc. at fair value (cost of $0 and $243,924,852, respectively)	—		247,263,245
Cash and cash equivalents	400,213		97,937
Other assets	11,573		15,064
Total assets	$	238,921,655	$	247,376,246
Liabilities and Members’ Capital
Liabilities
Accounts payable and accrued expenses	$	216,691	$	271,333
Due to related party	—		38,000
Total liabilities	216,691		309,333
Commitments and contingencies (Note 5)
Members’ capital:
Managing member	—		—
Non-managing members	238,704,964		247,066,913
Total members’ capital	238,704,964		247,066,913
Total liabilities and members’ capital	$	238,921,655	$	247,376,246
Net asset value per unit	$	35,962	$	37,222

See notes to unaudited financial statements.

2

Terra Secured Income Fund 5, LLC

Statements of Operations

(Unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Investment income
Dividend income	$	681,685	$	—	$	1,946,123	$	3,922,875
Other operating income	34		90		178		392
Total investment income	681,719		90		1,946,301		3,923,267
Operating expenses
Professional fees	161,100		98,119		335,199		271,333
Other	1,295		6,076		2,744		8,959
Total operating expenses	162,395		104,195		337,943		280,292
Net investment income (loss)	519,324		(104,105)		1,608,358		3,642,975
Net change in unrealized appreciation on investment	2,813,973		1,609,008		527,675		3,198,259
Net increase in members’ capital resulting from operations	$	3,333,297	$	1,504,903	$	2,136,033	$	6,841,234
Per unit data:
Net investment income (loss) per unit	$	78	$	(16)	$	242	$	549
Net increase in members’ capital resulting from operations per unit	$	502	$	227	$	322	$	1,030
Weighted average units outstanding	6,638		6,639		6,638		6,639

See notes to unaudited financial statements.

3

Terra Secured Income Fund 5, LLC

Statements of Changes in Members’ Capital

Three and Six Months Ended June 30, 2020 and 2019

(Unaudited)

	Managing Member		Non-Managing Members		Total
Balance, April 1, 2020	$	—	$	238,402,378	$	238,402,378
Capital distributions	—		(3,030,711)		(3,030,711)
Increase in members’ capital resulting from operations:
Net investment income	—		519,324		519,324
Net change in unrealized appreciation on investment	—		2,813,973		2,813,973
Net increase in members’ capital resulting from operations	—		3,333,297		3,333,297
Balance, June 30, 2020	$	—	$	238,704,964	$	238,704,964

	Managing Member		Non-Managing Members		Total
Balance, April 1, 2019	$	—	$	260,948,679	$	260,948,679
Capital distributions	—		(7,468,095)		(7,468,095)
Increase in members’ capital resulting from operations:
Net investment loss	—		(104,105)		(104,105)
Net change in unrealized appreciation on investment	—		1,609,008		1,609,008
Net increase in members’ capital resulting from operations	—		1,504,903		1,504,903
Balance, June 30, 2019	$	—	$	254,985,487	$	254,985,487

	Managing Member		Non-Managing Members		Total
Balance, January 1, 2020	$	—	$	247,066,913	$	247,066,913
Capital distributions	—		(10,497,982)		(10,497,982)
Increase in members’ capital resulting from operations:
Net investment income	—		1,608,358		1,608,358
Net change in unrealized appreciation on investment	—		527,675		527,675
Net increase in members’ capital resulting from operations	—		2,136,033		2,136,033
Balance, June 30, 2020	$	—	$	238,704,964	$	238,704,964

	Managing Member		Non-Managing Members		Total
Balance, January 1, 2019	$	—	$	263,080,442	$	263,080,442
Capital distributions	—		(14,936,189)		(14,936,189)
Increase in members’ capital resulting from operations:
Net investment income	—		3,642,975		3,642,975
Net change in unrealized appreciation on investment	—		3,198,259		3,198,259
Net increase in members’ capital resulting from operations	—		6,841,234		6,841,234
Balance, June 30, 2019	$	—	$	254,985,487	$	254,985,487

See notes to unaudited financial statements.

4

Terra Secured Income Fund 5, LLC

Statements of Cash Flows

(Unaudited)

	Six Months Ended June 30,
	2020		2019
Cash flows from operating activities:
Net increase in members’ capital resulting from operations	$	2,136,033	$	6,841,234
Adjustments to reconcile net increase in members’ capital resulting from operations to net cash provided by operating activities:
Return of capital on investment	9,281,051		11,260,039
Net change in unrealized appreciation on investment	(527,675)		(3,198,259)
Changes in operating assets and liabilities:
Decrease (increase) in other assets	3,491		(14,260)
(Decrease) increase in accounts payable and accrued expenses	(54,642)		8,804
Decrease in due to related party	(38,000)		—
Net cash provided by operating activities	10,800,258		14,897,558
Cash flows from financing activities:
Distributions paid	(10,497,982)		(14,936,189)
Net cash used in financing activities	(10,497,982)		(14,936,189)
Net increase (decrease) in cash and cash equivalents	302,276		(38,631)
Cash and cash equivalents at beginning of period	97,937		131,784
Cash and cash equivalents at end of period	$	400,213	$	93,153
Supplemental Non-Cash Disclosure:
Transfer of ownership interest in Terra Property Trust, Inc. to    Terra JV, LLC (Note 3)	$	244,006,890	$	—

See notes to unaudited financial statements.

5

Terra Secured Income Fund 5, LLC

Schedule of Investment

June 30, 2020 (unaudited) and December 31, 2019

On January 1, 2016, the Company, the then parent of Terra Property Trust, Inc. (“Terra Property Trust”), contributed its consolidated portfolio of net assets to Terra Property Trust pursuant to a contribution agreement in exchange for shares of Terra Property Trust’s common stock, par value $0.01 per share. Upon receipt of the contribution of the consolidated portfolio of net assets from the Company, Terra Property Trust commenced its operations on January 1, 2016. As discussed in Note 4, on March 2, 2020, Terra Property Trust engaged in a series of transactions pursuant to which Terra Property Trust issued an aggregate of 4,574,470.35 shares of its common stock in exchange for the settlement of an aggregate of $49.8 million of participation interests in loans that Terra Property Trust owned, cash of $25.5 million and other working capital. As of June 30, 2020, Terra JV, LLC (“Terra JV”) held 87.4% of the issued and outstanding shares of Terra Property Trust’s common stock with the remainder held by Terra International Fund 3 REIT, LLC (“TIF3 REIT”), and the Company and Terra Secured Income Fund 7, LLC (“Terra Fund 7”) owned an 87.6% and 12.4% percentage interest, respectively, in Terra JV. Accordingly, as of June 30, 2020, the Company indirectly beneficially owned 76.5% of the outstanding shares of common stock of Terra Property Trust through Terra JV.

        The following table presents a summary of the Company’s investment as of June 30, 2020 and December 31, 2019:

		Percentage Interest		June 30, 2020
Investment	Date Acquired			Cost		Fair Value		% of Members’ Capital
Terra JV, LLC	3/2/2020	87.6	%	$	238,509,445	$	238,509,869	99.9	%

		Number of Shares of Common Stock	December 31, 2019
Investment	Date Acquired		Cost		Fair Value		% of Members’ Capital
Terra Property Trust, Inc.	1/1/2016 and 3/7/2016	14,912,990	$	243,924,852	$	247,263,245	100.1	%

        As of June 30, 2020 and December 31, 2019, the Company indirectly beneficially owned 76.5% and directly owned 98.6%, respectively, of the outstanding shares of common stock of Terra Property Trust. Additionally, as of June 30, 2020, Terra JV was jointly-controlled by the Company and Terra Fund 7, and as of December 31, 2019, Terra Property Trust was controlled by the Company.

        The following table presents a schedule of loans held for investment by Terra Property Trust at 100% and the Company’s pro-rata share of the fair value at June 30, 2020:

Portfolio Company	Collateral Location	Property Type	Coupon Rate		Current Interest Rate		Exit Fee		Acquisition Date	Maturity Date	Principal Amount		Amortized Cost		Fair Value (1)		Pro Rata Fair Value (2)		% (3)
Loans held for investment:
Mezzanine loans:
150 Blackstone River Road, LLC	US - MA	Industrial	8.5	%	8.5	%	—	%	9/21/2017	9/6/2027	$	7,000,000	$	7,000,000	$	6,866,583	$	5,252,936	2.2	%
Austin H. I. Owner LLC	US - TX	Hotel	12.5	%	12.5	%	1.0	%	9/30/2015	10/6/2020	3,613,000		3,647,936		3,645,676		2,788,942		1.2	%
High Pointe Mezzanine Investments, LLC (4)	US - SC	Student housing	15.0	%	15.0	%	1.0	%	12/27/2013	1/6/2024	3,000,000		3,233,789		2,984,870		2,283,426		1.0	%
LD Milipitas Mezz, LLC (7)	US - CA	Hotel	LIBOR +10.25% (2.75% Floor)		13.0	%	1.0	%	6/27/2018	6/27/2021	4,250,000		4,297,989		4,297,730		3,287,763		1.4	%
SparQ Mezz Borrower, LLC (8)	US - CA	Multifamily	12.0	%	12.0	%	1.0	%	9/29/2017	10/1/2020	8,700,000		8,785,415		8,756,821		6,698,968		2.9	%
Stonewall Station Mezz LLC (5)(6)	US - NC	Hotel	12.0% current 2.0% PIK		14.0	%	1.0	%	5/31/2018	5/20/2021	10,010,007		10,097,447		10,121,270		7,742,772		3.2	%
											36,573,007		37,062,576		36,672,950		28,054,807		11.9	%

See notes to unaudited financial statements.

7

Terra Secured Income Fund 5, LLC

Schedule of Investment (Continued)

June 30, 2020 (unaudited) and December 31, 2019

Terra Property Trust’s Schedule of Loans Held for Investment as of June 30, 2020 (Continued):

Portfolio Company	Collateral Location	Property Type	Coupon Rate		Current Interest Rate		Exit Fee		Acquisition Date	Maturity Date	Principal Amount		Amortized Cost		Fair Value (1)		Pro Rata Fair Value (2)		% (3)
Loans held for investment:
Preferred equity investments:
370 Lex Part Deux, LLC (5)(6)	US - NY	Office	LIBOR + 8.25% (2.44% Floor)		10.7	%	—	%	12/17/2018	1/9/2022	$	51,037,529	$	51,094,313	$	49,728,042	$	38,041,952	15.9	%
City Gardens 333 LLC (5)(6)	US - CA	Multifamily	LIBOR + 9.95% (2.0% Floor)		12.0	%	—	%	4/11/2018	4/1/2021	27,449,731		27,461,070		27,446,297		20,996,417		8.8	%
NB Private Capital, LLC (5)(6)(8)	Various	Student housing	16.0	%	16.0	%	1.0	%	7/27/2018	4/16/2021	19,670,115		19,837,285		19,864,687		15,196,486		6.3	%
Orange Grove Property Investors, LLC (5)(6)	US - CA	Condominium	LIBOR + 8.0% (4.0% Floor)		12.0	%	1.0	%	5/24/2018	6/1/2021	10,600,000		10,699,082		10,680,949		8,170,926		3.4	%
REEC Harlem Holdings Company, LLC	US - NY	Infill land	LIBOR + 12.5% (no Floor)		12.7	%	—	%	3/9/2018	3/9/2023	14,759,047		14,759,047		13,573,859		10,384,002		4.4	%
RS JZ Driggs, LLC (5)(6)(9)	US - NY	Multifamily	12.3	%	12.3	%	1.0	%	5/1/2018	8/1/2020	8,200,000		8,276,271		8,282,546		6,336,148		2.7	%
The Bristol at Southport, LLC (8)	US - WA	Multifamily	12.0	%	12.0	%	1.0	%	9/22/2017	9/22/2022	23,500,000		23,671,815		23,951,192		18,322,662		7.7	%
											155,216,422		155,798,883		153,527,572		117,448,593		49.2	%
First mortgages:
14th & Alice Street Owner, LLC (5)(10)	US - CA	Multifamily	LIBOR + 5.75% (3.25% Floor)		9.0	%	0.5	%	3/5/2019	3/5/2022	24,510,905		24,689,333		24,407,964		18,672,092		7.8	%
1389 Peachtree St, LP; 1401 Peachtree St, LP;    1409 Peachtree St, LP (11)	US - GA	Office	LIBOR + 4.5% (no Floor)		4.7	%	0.5	%	2/22/2019	2/10/2022	45,671,947		45,853,379		45,821,197		35,053,216		14.7	%
330 Tryon DE LLC (11))	US - NC	Office	LIBOR + 3.85% (2.51% Floor)		6.4	%	0.5	%	2/7/2019	3/1/2022	22,800,000		22,896,169		22,898,866		17,517,632		7.4	%
AGRE DCP Palm Springs, LLC (11)	US - CA	Hotel	LIBOR +4.75% (1.80% Floor)		6.6	%	0.5	%	12/12/2019	1/1/2023	32,975,680		33,030,797		33,084,469		25,309,619		10.6	%
MSC Fields Peachtree Retreat, LLC (11)	US - GA	Multifamily	LIBOR + 3.85% (2.0% Floor)		5.9	%	0.5	%	3/15/2019	4/1/2022	23,308,335		23,442,092		23,108,448		17,677,963		7.4	%
Patrick Henry Recovery Acquisition, LLC (11)	US - CA	Office	LIBOR + 2.95% (1.5% Floor)		4.5	%	0.3	%	11/25/2019	12/1/2023	18,000,000		18,038,578		17,845,715		13,651,972		5.7	%
TSG-Parcel 1, LLC (5)(6)	US - CA	Infill land	15.0	%	15.0	%	1.0	%	7/10/2015	12/31/2020	18,000,000		18,180,000		18,177,747		13,905,976		5.8	%
University Park Berkeley, LLC	US - CA	Student housing	LIBOR + 2.95% (1.50% Floor)		4.5	%	0.3	%	2/27/2020	3/1/2023	23,250,000		23,272,652		23,304,937		17,828,277		7.5	%
Windy Hill PV Five CM, LLC (12)	US - CA	Office	LIBOR + 6.0% (2.05% Floor)		8.1	%	0.5	%	9/20/2019	9/20/2022	13,797,643		13,498,117		13,825,988		10,576,881		4.4	%
											222,314,510		222,901,117		222,475,331		170,193,628		71.3	%
Total gross loans held for investment											414,103,939		415,762,576		412,675,853		315,697,028		132.3	%
Obligations under participation agreements (5)(6)(10)											(78,116,748)		(78,246,519)		(77,898,387)		(59,592,266)		(25.1)	%
Allowance for loan losses											—		(1,314,294)		—		—		—	%
Net loans held for investment											$	335,987,191	$	336,201,763	$	334,777,466	$	256,104,762	107.2	%

See notes to unaudited financial statements.

8

Terra Secured Income Fund 5, LLC

Schedule of Investment (Continued)

June 30, 2020 (unaudited) and December 31, 2019

Terra Property Trust’s Schedule of Loans Held for Investment as of June 30, 2020 (Continued):

Operating real estate:
Description	Acquisition Date		Real estate owned, net		Encumbrance		Net Investment		Pro Rata Net Investment (2)		% (3)(15)
Multi-tenant office building in Santa Monica, CA (13)	7/30/2018		$	50,570,596	$	44,481,855	$	6,088,741	$	4,657,887	2.0		%
Land in Conshohocken, PA (14)	1/9/2019		13,395,430		—		13,395,430		10,247,504		4.2		%
			$	63,966,026	$	44,481,855	$	19,484,171	$	14,905,391	6.2		%
Portfolio Company	Interest Rate		Acquisition Date		Maturity Date		Shares		Cost		Fair Value			Pro Rata Fair Value (2)		% (3)
Marketable securities (16):
Preferred shares:
City Office REIT, Inc. - Series A Preferred Shares	6.63	%	3/19/2020		10/4/2021		5,768		$	104,653	$	136,529		$	104,445	0.04	%
City Office REIT, Inc. - Series A Preferred Shares	6.63	%	3/26/2020		10/4/2021		4,206		63,910		99,556			76,160		0.04	%
Total marketable securities									$	168,563	$	236,085		180,605		0.08	%

^{__________________________}

(1)Because there is no readily available market for these loans, these loans were valued using significant unobservable inputs under Level 3 of the fair value hierarchy and were approved in good faith by Terra REIT Advisors, LLC (“Terra REIT Advisors”), Terra Property Trust’s manager, pursuant to Terra Property Trust’s valuation policy.

(2)Amount represents the Company’s portion, or 76.5%, of the fair value or net investment value.

(3)Percentage is based on the Company’s pro rata share of the fair value or net investment value over the Company’s total members’ capital of $238.7 million at June 30, 2020.

(4)Terra Property Trust entered into a forbearance agreement with the borrower to allow for more time to make the interest payment.

(5)The loan participations from Terra Property Trust do not qualify for sale accounting and therefore, the gross amount of these loans remain in the consolidated balance sheets.

(6)Terra Property Trust sold a portion of its interest in this loan through a participation agreement to Terra Income Fund 6, Inc., an affiliated fund advised by Terra Income Advisors, LLC (“Terra Income Advisors”), an affiliate of our sponsor and Terra Property Trust’s manager.

(7)On June 27, 2018, Terra Property Trust entered into a participation agreement with Terra Income Fund 6, Inc. to purchase a 25% interest, or $4.3 million, in a mezzanine loan. As of June 30, 2020, the commitment was fully funded.

(8)In June 2020, Terra Property Trust amended the credit facility agreement to provide for interest at a fixed rate of 16.00% and to capitalize any unpaid interest to principal.

(9)In August 2020, Terra Property Trust extended the maturity of this loan to February 1, 2021.

(10)Terra Property Trust sold a portion of its interest in this loan via a participation agreement to a third-party.

(11)These loans were used as collateral for $95.4 million of borrowings under a repurchase agreement.

(12)In March 2020, Terra Property Trust restructured the loan into A-note and B-note. In connection with the restructuring, Terra Property Trust sold the A-note to a third-party. However, the sale did not qualify for sale accounting and therefore, the gross amount of the loan remains in the consolidated balance sheets.

9

(13)Terra Property Trust acquired this property through foreclosure of a $54.0 million first mortgage. Real estate owned, net amount includes building and building improvements, tenant improvements and lease intangible assets and liabilities, net of accumulated depreciation and amortization.

(14)Terra Property Trust acquired the collateral for this loan via deed in lieu of foreclosure. On June 30, 2019, Terra Property Trust recorded an impairment charge of $1.6 million on the land in order to reduce the carrying value of the land to its estimated fair value, which is the estimated selling price less the cost of sale.

(15)Percentage is based on Terra Property Trust’s net exposure on the property (real estate owned less encumbrance).

(16)From time to time, Terra Property Trust might invest in short-term debt and equity securities. These securities are comprised of shares of preferred stock and bonds.

See notes to unaudited financial statements.

10

Terra Secured Income Fund 5, LLC

Schedule of Investment (Continued)

June 30, 2020 (unaudited) and December 31, 2019

        The following table presents a schedule of loans held for investment held by Terra Property Trust as of December 31, 2019:

Portfolio Company	Collateral Location	Property Type	Coupon Rate		Current Interest Rate		Exit Fee		Acquisition Date	Maturity Date	Principal Amount		Amortized Cost		Fair Value (1)		Pro Rata Fair Value (2)		% (3)
Loans held for investment — non-controlled:
Mezzanine loans:
150 Blackstone River Road, LLC	US - MA	Industrial	8.5	%	8.5	%	—	%	9/21/2017	9/6/2027	$	7,000,000	$	7,000,000	$	7,081,127	$	6,981,991	2.8	%
2539 Morse, LLC (4)(5)(6)	US - CA	Student housing	11.0	%	11.0	%	1.0	%	10/20/2017	11/1/2020	7,000,000		7,067,422		7,069,355		6,970,384		2.8	%
Austin H. I. Owner LLC (4)(6)	US - TX	Hotel	12.5	%	12.5	%	1.0	%	9/30/2015	10/6/2020	3,500,000		3,531,776		3,534,499		3,485,016		1.4	%
High Pointe Mezzanine Investments, LLC (5)(6)	US - SC	Student housing	13.0	%	13.0	%	1.0	%	12/27/2013	1/6/2024	3,000,000		3,263,285		3,115,139		3,071,527		1.2	%
LD Milipitas Mezz, LLC (9)	US - CA	Hotel	LIBOR +10.25% (2.75% Floor)		13.0	%	1.0	%	6/27/2018	6/27/2021	3,120,887		3,150,546		3,204,261		3,159,401		1.3	%
SparQ Mezz Borrower, LLC (4)(5)(6)	US - CA	Multifamily	12.0	%	12.0	%	1.0	%	9/29/2017	10/1/2020	8,700,000		8,783,139		8,786,127		8,663,121		3.5	%
Stonewall Station Mezz LLC (6)(7)	US - NC	Hotel	12.0% current 2.0% PIK		14.0	%	1.0	%	5/31/2018	5/20/2021	9,792,767		9,875,162		9,883,488		9,745,119		3.9	%
											42,113,654		42,671,330		42,673,996		42,076,559		16.9	%

See notes to unaudited financial statements.

11

Terra Secured Income Fund 5, LLC

Schedule of Investment (Continued)

June 30, 2020 (unaudited) and December 31, 2019

Terra Property Trust’s Schedule of Loans Held for Investment as of December 31, 2019 (Continued):

Portfolio Company	Collateral Location	Property Type	Coupon Rate		Current Interest Rate		Exit Fee		Acquisition Date	Maturity Date	Principal Amount		Amortized Cost		Fair Value (1)		Pro Rata Fair Value (2)		% (3)
Loans held for investment — non-controlled:
Preferred equity investments:
370 Lex Part Deux, LLC (6)(7)(8)	US - NY	Office	LIBOR + 8.25% (2.44% Floor)		10.7	%	—	%	12/17/2018	1/9/2022	$	48,349,948	$	48,425,659	$	48,236,458	$	47,561,148	19.3	%
City Gardens 333 LLC (4)(5)(6)(7)(8)	US - CA	Student housing	LIBOR + 9.95% (2.0% Floor)		12.0	%	—	%	4/11/2018	4/1/2021	28,049,717		28,056,179		28,057,779		27,664,970		11.2	%
NB Private Capital, LLC (4)(5)(6)(7)(8)	Various	Student housing	LIBOR +10.5% (3.5% Floor)		14.0	%	1.0	%	7/27/2018	4/16/2021	20,000,000		20,166,610		20,180,782		19,898,251		8.1	%
Orange Grove Property Investors, LLC (6)(7)	US - CA	Condominium	LIBOR + 8.0% (4.0% Floor)		12.0	%	1.0	%	5/24/2018	6/1/2021	10,600,000		10,696,587		10,695,415		10,545,679		4.3	%
REEC Harlem Holdings Company, LLC	US - NY	Infill land	LIBOR + 12.5% (no Floor)		14.3	%	—	%	3/9/2018	3/9/2023	18,444,375		18,444,375		18,280,168		18,024,246		7.3	%
RS JZ Driggs, LLC (6)(7)	US - NY	Multifamily	12.3	%	12.3	%	1.0	%	5/1/2018	5/1/2020	8,200,000		8,286,629		8,277,336		8,161,453		3.3	%
The Bristol at Southport, LLC (4)(5)(6)(8)	US - WA	Multifamily	12.0	%	12.0	%	1.0	%	9/22/2017	9/22/2022	23,500,000		23,661,724		23,769,361		23,436,590		9.5	%
											157,144,040		157,737,763		157,497,299		155,292,337		63.0	%
First mortgages:
14th & Alice Street Owner, LLC (10)	US - CA	Multifamily	LIBOR + 5.75% (3.25% Floor)		9.0	%	0.5	%	3/5/2019	3/5/2022	12,932,034		12,957,731		12,983,863		12,802,089		5.2	%
1389 Peachtree St, LP; 1401 Peachtree St, LP;    1409 Peachtree St, LP (11)	US - GA	Office	LIBOR + 4.5% (no Floor)		6.3	%	0.5	%	2/22/2019	2/10/2022	38,464,429		38,510,650		38,655,000		38,113,830		15.4	%
330 Tryon DE LLC (11)	US - NC	Office	LIBOR + 3.85% (2.51% Floor)		6.4	%	0.5	%	2/7/2019	3/1/2022	22,800,000		22,891,149		22,906,207		22,585,520		9.0	%
AGRE DCP Palm Springs, LLC (11)	US - CA	Hotel	LIBOR +4.75% (1.80% Floor)		6.6	%	0.5	%	12/12/2019	1/1/2023	30,184,357		30,174,455		30,326,076		29,901,511		12.1	%
MSC Fields Peachtree Retreat, LLC (11)	US - GA	Multifamily	LIBOR + 3.85% (2.0% Floor)		5.9	%	0.5	%	3/15/2019	4/1/2022	23,308,335		23,446,793		23,418,996		23,091,130		9.3	%
Patrick Henry Recovery Acquisition, LLC	US - CA	Office	LIBOR + 2.95% (1.5% Floor)		4.7	%	0.3	%	11/25/2019	12/1/2023	18,000,000		18,037,329		18,042,390		17,789,797		7.2	%
REEC 286 Lenox LLC	US - NY	Office	LIBOR + 2.95% (no Floor)		4.7	%	—	%	8/2/2019	9/22/2019	4,740,000		4,740,000		4,740,000		4,673,640		1.9	%
TSG-Parcel 1, LLC (4)(6)(7)	US - CA	Infill land	LIBOR + 10.0% (2.0% Floor)		12.0	%	1.0	%	7/10/2015	3/31/2020	18,000,000		18,180,000		18,174,634		17,920,189		7.3	%
Windy Hill PV Five CM, LLC	US - CA	Office	LIBOR + 6.0% (2.05% Floor)		8.1	%	0.5	%	9/20/2019	9/20/2022	9,701,468		9,265,568		9,741,954		9,605,567		3.9	%
											178,130,623		178,203,675		178,989,120		176,483,273		71.3	%
Total gross loans held for investment											377,388,317		378,612,768		379,160,415		373,852,169		151.3	%
Obligations under participation agreements (4)(5)(6)(7)(8)											(102,564,795)		(103,186,327)		(103,188,783)		(101,744,140)		(41.2)	%
Net loans held for investment											$	274,823,522	$	275,426,441	$	275,971,632	$	272,108,029	110.1	%

See notes to unaudited financial statements.

12

Terra Secured Income Fund 5, LLC

Schedule of Investment (Continued)

June 30, 2020 (unaudited) and December 31, 2019

Terra Property Trust’s Schedule of Loans Held for Investment as of December 31, 2019 (Continued):

Operating real estate:
Description	Acquisition Date	Real estate owned, net		Encumbrance		Net Investment		Pro Rata Net Investment (2)		% (3)(14)
Multi-tenant office building in Santa Monica, CA (12)	7/30/2018	$	52,776,236	$	44,614,480	$	8,161,756	$	8,047,491	3.3	%
Land in Conshohocken, PA (13)	1/9/2019	13,395,430		—		13,395,430		13,207,894		5.3	%
		$	66,171,666	$	44,614,480	$	21,557,186	$	21,255,385	8.6	%

^{___________________________}

(1)Because there is no readily available market for these loans, these loans were valued using significant unobservable inputs under Level 3 of the fair value hierarchy and were approved in good faith by Terra REIT Advisors, Terra Property Trust’s manager, pursuant to Terra Property Trust’s valuation policy.

(2)Amount represents the Company’s portion, or 98.6%, of the fair value or net investment value.

(3)Percentage is based on the Company’s pro rata share of the fair value or net investment value over the Company’s total members’ capital of $247.1 million at December 31, 2019.

(4)Terra Property Trust sold a portion of its interests in these loans via participation agreements to Terra Secured Income Fund 5 International, an affiliated fund advised by Terra REIT Advisors.

(5)Terra Property Trust sold a portion of its interests in these loans via participation agreements to Terra Income Fund International, an affiliated fund advised by Terra REIT Advisors.

(6)The loan participations from Terra Property Trust do not qualify for sale accounting and therefore, the gross amount of these loans remain in the consolidated statements of financial condition.

(7)Terra Property Trust sold a portion of its interest in this loan through a participation agreement to Terra Income Fund 6, Inc., an affiliated fund advised by Terra Income Advisors, an affiliate of our sponsor and Terra Property Trust’s manager.

(8)Terra Property Trust sold a portion of its interest in this loan through a participation agreement to TPT2, an affiliated fund managed by Terra REIT Advisors.

(9)On June 27, 2018, Terra Property Trust entered into a participation agreement with Terra Income Fund 6, Inc. to purchase a 25% interest, or $4.3 million, in a mezzanine loan. As of December 31, 2019, the unfunded commitment was $1.1 million.

(10)Terra Property Trust sold a portion of its interest in this loan via a participation agreement to a third-party.

(11)These loans were used as collateral for $81.1 million of borrowings under a repurchase agreement.

(12)Terra Property Trust acquired this property through foreclosure of a $54.0 million first mortgage. Real estate owned, net amount includes building and building improvements, tenant improvements and lease intangible assets and liabilities, net of accumulated depreciation and amortization.

(13)Terra Property Trust acquired the collateral for this loan via deed in lieu of foreclosure. On June 30, 2019, Terra Property Trust recorded an impairment charge of $1.6 million on the land in order to reduce the carrying value of the land to its estimated fair value, which is the estimated selling price less the cost of sale.

(14)Percentage is based on Terra Property Trust’s net exposure on the property (real estate owned less encumbrance).

See notes to unaudited financial statements.

13

Terra Secured Income Fund 5, LLC

Notes to Financial Statements (Unaudited)

June 30, 2020

Note 1. Business

        Terra Secured Income Fund 5, LLC (the “Company”), is a real estate credit focused company that originates, structures, funds and manages high yielding commercial real estate investments, including mezzanine loans, first mortgage loans, subordinated mortgage loans and preferred equity investments throughout the United States. The Company’s loans finance the acquisition, construction, development or redevelopment of quality commercial real estate in the United States. The Company focuses on the origination of middle market loans in the approximately $10 million to $50 million range, to finance properties in primary and secondary markets. The Company believes loans of this size are subject to less competition, offer higher risk adjusted returns than larger loans with similar risk metrics and facilitate portfolio diversification. The Company was formed as a Delaware limited liability company on April 24, 2013 and commenced operations on August 8, 2013. The Company makes substantially all of its investments and conducts substantially all of its real estate lending business through Terra Property Trust, which has elected to be taxed as a real estate investment trust (“REIT”) for U.S. federal income tax purposes commencing with its taxable year ended December 31, 2016. The Company’s objectives are to (i) preserve its members’ capital contributions, (ii) realize income from its investments and (iii) make monthly distributions to its members from cash generated from investments. There can be no assurances that the Company will be successful in meeting its objectives.

        In December 2015, the members approved the merger of Terra Secured Income Fund, LLC (“Terra Fund 1”), Terra Secured Income Fund 2, LLC (“Terra Fund 2”), Terra Secured Income Fund 3, LLC (“Terra Fund 3”) and Terra Secured Income Fund 4, LLC (“Terra Fund 4”) with and into subsidiaries of the Company (individually, each a “Terra Fund” and collectively, the “Terra Funds”) through a series of separate mergers effective January 1, 2016 (collectively, the “Merger”). Following the Merger, the Company contributed the consolidated portfolio of net assets of the five Terra Funds to Terra Property Trust, a newly-formed and wholly-owned subsidiary of the Company that elected to be taxed as a REIT, in exchange for the shares of common stock of Terra Property Trust. Upon completion of the Merger, the Company became the parent company of Terra Funds 1 through 4 and the direct and indirect sole common stockholder of, and began conducting substantially all of its real estate lending business through, Terra Property Trust.

        On March 2, 2020, Terra Fund 1, Terra Fund 2 and Terra Fund 3 merged with and into Terra Fund 4, with Terra Fund 4 continuing as the surviving company (the “Terra Fund Merger”), and the Company consolidated its holdings of shares of common stock of Terra Property Trust in Terra Fund 4. Subsequent to the Terra Fund Merger, the legal name of Terra Fund 4 was changed to Terra JV. On March 2, 2020, Terra Property Trust engaged in a series of transactions pursuant to which Terra Property Trust issued an aggregate of 4,574,470.35 shares of its common stock in exchange for the settlement of an aggregate of $49.8 million of participation interests in loans that Terra Property Trust owned, cash of $25.5 million and other working capital. As of June 30, 2020, Terra JV held 87.4% of the issued and outstanding shares of Terra Property Trust’s common stock with the remainder held by TIF3 REIT, and the Company and Terra Fund 7 owned an 87.6% and 12.4% percentage interest, respectively, in Terra JV (Note 4). The Company does not consolidate Terra JV because the Company and Terra Fund 7 share joint approval rights with respect to certain major decisions that are taken by Terra JV and Terra Property Trust (Note 4).

        The Company’s investment activities are externally managed by Terra Fund Advisors, LLC (“Terra Fund Advisors”). The Company does not currently have any employees and does not expect to have any employees. Services necessary for the Company’s business are provided by individuals who are employees of the Manager or its affiliates or by individuals who were contracted by the Company or by the Manager or its affiliates to work on behalf of the Company pursuant to the terms of the operating agreement, as amended.

        The Company’s amended and restated operating agreement provides that the Company’s existence will continue until December 31, 2023, unless sooner terminated. However, the Company expects that prior to such date it will consummate a liquidity transaction, which may include an orderly liquidation of its assets or an alternative liquidity event such as a sale of the Company or an initial public offering and listing of Terra Property Trust’s shares of common stock on a national securities exchange. The Manager would pursue an alternative liquidity event only if it believes such a transaction would be in the best interests of the Company’s members.

14

Notes to Unaudited Financial Statements

Note 2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

        The interim financial statements have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP”). The financial statements as of December 31, 2019 and for the three and six months ended June 30, 2019 and the period from January 1, 2020 to March 1, 2020 included all of the Company’s accounts and those of its consolidated subsidiaries. All intercompany balances and transactions had been eliminated. As discussed in Note 1, on March 2, 2020, the Company’s subsidiaries completed the Terra Fund Merger. As a result of the Terra Fund Merger, the Company no longer consolidates the subsidiaries. The financial statements as of June 30, 2020 and for the period from March 2, 2020 to June 30, 2020 and the three months ended June 30, 2020 includes all of the Company’s accounts only.

        The accompanying interim financial statements of the Company and related financial information have been prepared pursuant to the requirements for reporting on Form 10-Q and Articles 6 or 10 of Regulation S-X. The Company is an investment company, as defined under U.S. GAAP, and applies accounting and reporting guidance in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services - Investment Companies.

Use of Estimates

        The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. During the first half of 2020, there was a global outbreak of a novel coronavirus (“COVID-19”), which has spread to over 200 countries and territories, including the United States, and has spread to every state in the United States. The World Health Organization has designated COVID-19 as a pandemic, and numerous countries, including the United States, have declared national emergencies with respect to COVID-19. The global impact of the outbreak has been rapidly evolving, and as cases of COVID-19 have continued to be identified in additional countries, many countries have reacted by instituting quarantines and restrictions on travel, closing financial markets and/or restricting trading and operations of non-essential offices and retail centers. Such actions are creating disruption in global supply chains, and adversely impacting many industries. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19 on economic and market conditions. The Company believes the estimates and assumptions underlying its financial statements are reasonable and supportable based on the information available as of June 30, 2020, however uncertainty over the ultimate impact COVID-19 will have on the global economy generally, and the Company’s business in particular, makes any estimates and assumptions as of June 30, 2020 inherently less certain than they would be absent the current and potential impacts of COVID-19. Actual results may ultimately differ from those estimates.

Equity Investment in Terra JV or Terra Property Trust

        Equity investment in Terra JV or Terra Property Trust represents the Company’s equity interest in Terra JV or Terra Property Trust as applicable, which was initially recorded at cost. Subsequent to the asset contribution, the equity investment is reported, at each reporting date, at fair value on the statements of financial condition. Change in fair value is reported in net change in unrealized appreciation or depreciation on investment on the statements of operations.

Revenue Recognition

        Dividend Income: Dividend income associated with the Company’s ownership of Terra JV or Terra Property Trust is recognized on the record date as declared by Terra JV or Terra Property Trust. Any excess of distributions over Terra JV or Terra Property Trust’s cumulative net income are recorded as return of capital.

        Other Operating Income: All other income is recognized when earned.

Cash and Cash Equivalents

The Company considers all highly liquid investments, with original maturities of ninety days or less when purchased, as cash equivalents. Cash and cash equivalents are exposed to concentrations of credit risk. The Company maintains all of its cash at financial institutions which, at times, may exceed the amount insured by the Federal Deposit Insurance Corporation.

15

Notes to Unaudited Financial Statements

Income Taxes

        No provision for U.S. federal and state income taxes has been made in the accompanying financial statements, as individual members are responsible for their proportionate share of the Company’s taxable income. The Company, however, may be liable for New York City Unincorporated Business Tax (the “NYC UBT”) and similar taxes of various other municipalities. New York City imposes the NYC UBT at a statutory rate of 4% on net income generated from ordinary business activities carried on in New York City. For the three and six months ended June 30, 2020 and 2019, none of the Company’s income was subject to the NYC UBT.

        Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statements and tax basis assets and liabilities using enacted tax rates in effect for the year in which differences are expected to reverse. Such deferred tax assets and liabilities were not material.

        The Company did not have any uncertain tax positions that met the recognition or measurement criteria of ASC 740-10-25, Income Taxes, nor did the Company have any unrecognized tax benefits as of the periods presented herein. The Company recognizes interest and penalties, if any, related to unrecognized tax liabilities as income tax expense in its statements of operations. For the three and six months ended June 30, 2020 and 2019, the Company did not incur any interest or penalties. Although the Company files federal and state tax returns, its primary tax jurisdiction is federal. The Company’s 2015-2019 federal tax years remain subject to examination by the Internal Revenue Service.

Recent Accounting Pronouncement

        In February 2016, the FASB issued Accounting Standards Update 2018-13, Fair Value Measurement (Topic 820): Disclosure framework — Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The objective of ASU 2018-13 is to improve the effectiveness of disclosures in the notes to financial statements by facilitating clear communication of information required by U.S. GAAP. The amendments in ASU 2018-13 added, removed and modified certain fair value measurement disclosure requirements. ASU 2018-13 is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The Company adopted ASU 2018-13 on January 1, 2020. The adoption of ASU 2018-13 did not have a material impact on its financial statements and disclosures.

Note 3. Investment and Fair Value

Equity Investment in Terra JV or Terra Property Trust

The Company invested substantially all of its equity capital in the purchase of shares of common stock of Terra Property Trust. On March 2, 2020, Terra Property Trust engaged in a series of transactions pursuant to which Terra Property Trust issued an aggregate of 4,574,470.35 shares of its common stock in exchange for the settlement of an aggregate of $49.8 million of participation interests in loans that Terra Property Trust owned, cash of $25.5 million and other working capital. As of June 30, 2020, Terra JV held 87.4% of the issued and outstanding shares of Terra Property Trust’s common stock with the remainder held by TIF3 REIT, and the Company and Terra Fund 7 owned an 87.6% and 12.4% percentage interest, respectively, in Terra JV, and Terra JV became the Company’s only investment (Note 4).

16

Notes to Unaudited Financial Statements

The following tables present a summary of the Company’s investment at June 30, 2020 and December 31, 2019:

	June 30, 2020
Investment	Cost		Fair Value		% of Members’ Capital
87.6% interest in Terra JV, LLC	$	238,509,445	$	238,509,869	99.9	%

	December 31, 2019
Investment	Cost		Fair Value		% of Members’ Capital
14,912,990 common shares of Terra Property Trust, Inc.	$	243,924,852	$	247,263,245	100.1	%

For the three months ended June 30, 2020 and 2019, the Company received approximately $3.4 million and $7.6 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $2.7 million and $7.6 million were returns of capital, respectively. For the six months ended June 30, 2020 and 2019, the Company received approximately $11.2 million and $15.2 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $9.3 million and $11.3 million were returns of capital, respectively.

        As of June 30, 2020 and December 31, 2019, the Company indirectly beneficially owned 76.5% (Note 4) and directly owned 98.6% of the outstanding shares of common stock of Terra Property Trust, respectively. The following tables present the summarized financial information of Terra Property Trust:

	June 30, 2020		December 31, 2019
Carrying value of loans held for investment	$	414,448,282	$	378,612,768
Real estate owned, net	75,694,708		77,596,475
Cash, cash equivalent and restricted cash	102,945,300		50,549,700
Other assets	21,143,973		20,584,135
Total assets	614,232,263		527,343,078
Mortgage loan payable, repurchase agreement payable, revolving credit facility payable and obligations under participation agreements	(252,571,125)		(227,548,397)
Accounts payable, accrued expenses and other liabilities	(41,304,905)		(40,826,139)
Lease intangible liabilities	(11,127,360)		(11,424,809)
Total liabilities	(305,003,390)		(279,799,345)
Stockholder’s equity	$	309,228,873	$	247,543,733

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Revenues	$	12,064,629	$	13,332,694	$	24,142,200	$	26,070,628
Expenses	(10,562,322)		(13,486,179)		(21,750,371)		(22,301,238)
Net loss on extinguishment of obligations under participation agreements	—		—		(319,453)		—
Realized gains on marketable securities	1,076,213		—		1,085,107		—
Unrealized gains on marketable securities	67,522		—		67,522		—
Net income (loss)	$	2,646,042	$	(153,485)	$	3,225,005	$	3,769,390

Fair Value Measurements

        The Company adopted the provisions of ASC 820, Fair Value Measurement (“ASC 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 established a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment, the characteristics specific to the investment, and the state of the marketplace (including the existence and transparency of transactions between market participants). Investments with readily available, actively quoted prices or for which fair value can be measured from actively quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree

17

Notes to Unaudited Financial Statements

of judgment used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Investments measured and reported at fair value are classified and disclosed into one of the following categories based on the inputs as follows:

        Level 1 — Quoted prices (unadjusted) in active markets for identical assets and liabilities that the Company has the ability to access.

        Level 2 — Pricing inputs are other than quoted prices in active markets, including, but not limited to, quoted prices for similar assets and liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs.

        Level 3 — Significant unobservable inputs are based on the best information available in the circumstances, to the extent observable inputs are not available, including the Company’s own assumptions used in determining the fair value of investments. Fair value for these investments are determined using valuation methodologies that consider a range of factors, including but not limited to the price at which the investment was acquired, the nature of the investment, local market conditions, trading values on public exchanges for comparable securities, current and projected operating performance, and financing transactions subsequent to the acquisition of the investment. The inputs into the determination of fair value require significant management judgment.

  In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment.

Assets and Liabilities Reported at Fair Value

        The following table summarizes the Company’s equity investment at fair value on a recurring basis as of June 30, 2020 and December 31, 2019:

	June 30, 2020
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Investment:
Equity investment in Terra JV	$	—	$	—	$	238,509,869	$	238,509,869

	December 31, 2019
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Investment:
Equity investment in Terra Property Trust	$	—	$	—	$	247,263,245	$	247,263,245

18

Notes to Unaudited Financial Statements

        Changes in Level 3 investment for the six months ended June 30, 2020 and 2019 were as follows:

	Equity Investment in Terra JV		Equity Investment in Terra Property Trust
	Period from March 2, 2020 to June 30, 2020		Period from January 1, 2020 to March 1, 2020		Six Months Ended June 30, 2019
Beginning balance	$	—	$	247,263,245	$	263,092,586
Transfer of ownership interest in Terra Property Trust to Terra JV	244,006,890		(244,006,890)		—
Return of capital	(5,497,444)		(3,783,607)		(11,260,039)
Net change in unrealized appreciation on investment	423		527,252		3,198,259
Ending balance	$	238,509,869	$	—	$	255,030,806
Net change in unrealized appreciation on investment for the period relating to those Level 3 assets that were still held by the Company	$	423	$	527,252	$	3,198,259

        Transfers between levels, if any, are recognized at the beginning of the period in which transfers occur. For the six months ended June 30, 2020 and 2019, there were no transfers.

The Company estimated that its other financial assets and liabilities had fair values that approximated their carrying values at June 30, 2020 and December 31, 2019 due to their short-term nature.

Valuation Process for Fair Value Measurement

        Market quotations are not readily available for the Company’s investment in Terra Property Trust or Terra JV, which is included in Level 3 of the fair value hierarchy. The fair value of the Company’s sole investment takes into consideration the fair value of Terra Property Trust’s assets and liabilities which are valued utilizing a yield approach, i.e. a discounted cash flow methodology. In following this methodology, loans are evaluated individually, and management takes into account, in determining the risk-adjusted discount rate for each of Terra Property Trust’s loans, relevant factors, including available current market data on applicable yields of comparable debt/preferred equity instruments; market credit spreads and yield curves; the investment’s yield; covenants of the investment, including prepayment provisions; the portfolio company’s ability to make payments, its net operating income, debt-service coverage ratio; construction progress reports and construction budget analysis; the nature, quality, and realizable value of any collateral (and loan-to-value ratio); and the forces that influence the local markets in which the asset (the collateral) is purchased and sold, such as capitalization rates, occupancy rates, rental rates, replacement costs and the anticipated duration of each real estate-related loan.

The Manager designates a valuation committee to oversee the entire valuation process of Terra Property Trust’s Level 3 investments. The valuation committee is comprised of members of the Manager’s senior management, deal and portfolio management teams, who meet on a quarterly basis, or more frequently as needed, to review Terra Property Trust investments being valued as well as the inputs used in the proprietary valuation model. Valuations determined by the valuation committee are supported by pertinent data and, in addition to a proprietary valuation model, are based on market data, third-party valuation data and discount rates or other methods the valuation committee deems to be appropriate.

The following tables summarize the valuation techniques and significant unobservable inputs used by the Company to value the Level 3 investments as of June 30, 2020 and December 31, 2019. The tables are not intended to be all-inclusive, but instead identify the significant unobservable inputs relevant to the determination of fair values.

	Fair Value		Primary Valuation Technique	Unobservable Inputs	June 30, 2020
Asset Category					Minimum		Maximum		Weighted Average
Assets:
Equity investment in Terra JV	$	238,509,869	Discounted cash flow (1)	Discount rate (1)	2.51	%	19.05	%	16.82	%

	Fair Value		Primary Valuation Technique	Unobservable Inputs	December 31, 2019
Asset Category					Minimum		Maximum		Weighted Average
Assets:
Equity investment in Terra Property Trust	$	247,263,245	Discounted cash flow (1)	Discount rate (1)	4.11	%	14.95	%	12.36	%

_______________

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Notes to Unaudited Financial Statements

(1)Discounted cash flows and discount rates applied to Terra Property Trust’s assets and liabilities.

Risks and Uncertainties

        The Company’s investment in Terra Property Trust or Terra JV is highly illiquid and there is no assurance that the Company will achieve its investment objectives, including targeted returns. Terra Property Trust’s loans are highly illiquid. Due to the illiquidity of the loans, valuation of the loans may be difficult, as there generally will be no established markets for these loans. As the Company’s investment is carried at fair value with fair value changes recognized in the statements of operations, any changes in fair value would directly affect the Company’s members’ capital.

Note 4. Related Party Transactions

Operating Agreement

        The Company has an operating agreement, as amended, with Terra Fund Advisors. The operating agreement, as amended, is scheduled to terminate on December 31, 2023 unless the Company is dissolved earlier. Starting January 1, 2016, the Company conducts all of its real estate lending business through Terra Property Trust. As such, Terra Property Trust is responsible for management compensation paid and operating expenses reimbursed to its manager pursuant to a management agreement with the manager.

Dividend Income

        As discussed in Note 3, for the three months ended June 30, 2020 and 2019, the Company received approximately $3.4 million and $7.6 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $2.7 million and $7.6 million were returns of capital, respectively. For the six months ended June 30, 2020 and 2019, the Company received approximately $11.2 million and $15.2 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $9.3 million and $11.3 million were returns of capital, respectively.

TPT2 Merger

        On February 28, 2020, Terra Property Trust entered into certain Agreement and Plan of Merger (the “Merger Agreement”), by and among Terra Property Trust, Terra Property Trust 2, Inc. (“TPT2”) and Terra Fund 7, the sole stockholder of TPT2, pursuant to which TPT2 merged with and into Terra Property Trust, with Terra Property Trust continuing as the surviving corporation (the “TPT2 Merger”), effective March 1, 2020. In connection with the TPT2 Merger, each share of common stock, par value $0.01 per share, of TPT2 issued and outstanding immediately prior to the effective time of the TPT2 Merger was converted into the right to receive from Terra Property Trust a number of shares of common stock, par value $0.01 per share, of Terra Property Trust equal to an exchange ratio, which was 1.2031. The exchange ratio was based on the relative fair value of Terra Property Trust and TPT2 as of December 31, 2019 as adjusted to reflect changes in net working capital of each of Terra Property Trust and TPT2 during the period from January 1, 2020 through March 1, 2020, the effective time for the TPT2 Merger. For purposes of determining the respective fair values of Terra Property Trust and TPT2, the value of the loans (or participation interests therein) held by each of Terra Property Trust and TPT2 was the value of such loans (or participation interests) as set forth in the audited financial statements of Terra Property Trust as of and for the year ended December 31, 2019. As a result, Terra Fund 7 received 2,116,785.76 shares of common stock of Terra Property Trust as consideration in the TPT2 Merger and subsequently contributed these shares to Terra JV. The shares of Terra Property Trust common stock issued in connection with the TPT2 Merger were issued in a private placement in reliance on Section 4(a)(2) under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations promulgated thereunder

Issuance of Common Stock to TIF3 REIT

        In addition, on March 2, 2020, Terra Property Trust entered into two separate contribution agreements, one by and among Terra Property Trust, TIF3 REIT and Terra Income Fund International, and another by and among Terra Property Trust, TIF3 REIT and Terra Secured Income Fund 5 International, pursuant to which Terra Property Trust issued 2,457,684.59 shares of common stock of Terra Property Trust to TIF3 REIT in exchange for the settlement of $32.1 million of participation interests in loans also held by Terra Property Trust, $8.6 million in cash and other working capital (“Issuance of Common Stock to TIF3 REIT”).The shares of common stock were issued in a private placement in reliance on Section 4(a)(2) under the Securities Act and the rules and regulations promulgated thereunder. On April 29, 2020, Terra Property Trust repurchased, at a purchase price $17.02 per share, 212,691 shares of common stock that Terra Property Trust had previously sold to TIF3 REIT on September 30, 2019.

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Notes to Unaudited Financial Statements

Terra JV, LLC

        Prior to the completion of the TPT2 Merger and the Issuance of Common Stock to TIF3 REIT transactions described above, the Company owned approximately 98.6% of the issued and outstanding shares of Terra Property Trust’s common stock indirectly through its wholly owned subsidiary, Terra JV, of which the Company was the sole managing member, and the remaining issued and outstanding shares of Terra Property Trust’s common stock were owned by TIF3 REIT.

        As described above, Terra Property Trust acquired TPT2 in the TPT2 Merger and, in connection with such transaction, Terra Fund 7 contributed the shares of Terra Property Trust’s common stock received as consideration in the TPT2 Merger to Terra JV and became a co-managing member of Terra JV pursuant to the amended and restated operating agreement of Terra JV, dated March 2, 2020 (the “JV Agreement”). The JV Agreement and related stockholders agreement between Terra JV and Terra Property Trust, dated March 2, 2020, provide for the joint approval of the Company and Terra Fund 7 with respect to certain major decisions that are taken by Terra JV and Terra Property Trust.

        On March 2, 2020, Terra Property Trust, the Company, Terra JV and Terra REIT Advisors also entered into the Amended and Restated Voting Agreement (the “Voting Agreement”), pursuant to which the Company assigned its rights and obligations under the Voting Agreement to Terra JV. Consistent with the original voting agreement dated February 8, 2018, for the period that Terra REIT Advisors remains the external manager of Terra Property Trust, Terra REIT Advisors will have the right to nominate two individuals to serve as directors of Terra Property Trust, until Terra JV no longer holds at least 10% of the outstanding shares of Terra Property Trust’s common stock, Terra JV will have the right to nominate one individual to serve as a director of Terra Property Trust.

        As of June 30, 2020, Terra JV owns approximately 87.4% of the issued and outstanding shares of Terra Property Trust common stock with the remainder held by TIF3 REIT, and the Company and Terra Fund 7 own an 87.6% and 12.4% interest, respectively, in Terra JV. As a result, as of June 30, 2020, the Company indirectly beneficially owned 76.5% of Terra Property Trust's outstanding common stock through Terra JV.

Note 5. Commitments and Contingencies

The Company enters into contracts that contain a variety of indemnification provisions. The Company’s maximum exposure under these arrangements is unknown; however, the Company has not had prior claims or losses pursuant to these contracts. The Manager has reviewed the Company’s existing contracts and expects the risk of loss to the Company to be remote.

The Company is not currently subject to any material legal proceedings and, to the Company’s knowledge, no material legal proceedings are threatened against the Company. From time to time, the Company may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of the Company’s rights under contracts with its portfolio companies. While the outcome of any legal proceedings cannot be predicted with certainty, the Company does not expect that any such proceedings will have a material adverse effect upon its financial condition or results of operations.

Note 6. Members’ Capital

        As of both June 30, 2020 and December 31, 2019, the Company had 6,637.7 units outstanding. The net asset value per unit was $35,962 and $37,222 as of June 30, 2020 and December 31, 2019, respectively.

Capital Contributions

        As of January 31, 2015, the offering period ended, and the Company stopped accepting capital contributions. In connection with the Merger, the Company offered existing members of the Terra Funds the opportunity to invest in the Company through purchase of additional units (the “Rights Offering”). The Rights Offering was completed on May 17, 2016.

Capital Distributions

        At the discretion of the Manager, the Company may make distributions from net cash flow from operations, net disposition proceeds, or other cash available for distribution. Distributions are made to holders of Continuing Income Units (regular units of limited liability company interest in the Company) in proportion to their unit holdings until they receive a return of their initial Deemed Capital Contribution, as defined in the operating agreement, plus a preferred return ranging from 8.5% to 9.0% depending on the historical preferred return applicable to their Terra Fund units, after which time distributions are made 15% to

21

Notes to Unaudited Financial Statements

the Manager which the Company refers to as the carried interest distribution, and 85% to the holders of Continuing Income Units. The preferred return applicable to the Continuing Income Units sold in the offering concurrent with the Merger is 8.5%.

        For the three months ended June 30, 2020 and 2019, the Company made total distributions to non-manager members of $3.0 million and $7.5 million, respectively. For the six months ended June 30, 2020 and 2019, the Company made total distributions to non-manager members of $10.5 million and $14.9 million, respectively. For the three and six months ended June 30, 2020 and 2019, the Company did not make any carried interest distributions to the Manager.

Capital Redemptions

        At the discretion of the Manager, a reserve of 5% of cash from operations may be established in order to repurchase units from non-managing members. The Manager is under no obligation to redeem non-managing members’ units. As of June 30, 2020 and December 31, 2019, no such reserve was established. For the three and six months ended June 30, 2020 and 2019, the Company did not redeem any membership units.

Allocation of Income (Loss)

        Profits and losses are allocated to the members in proportion to the units held in a given calendar year.

Member Units

        Each membership interest through the original offering was offered for a price of $50,000 per unit. The membership interests in Terra Funds 1 through 4 were exchanged for units of the Company at a price of $43,410 per unit, which was the exchange value per unit of the Company on December 31, 2015, and the units in the Rights Offering were offered at a price of $47,000 per unit. For the six months ended June 30, 2020 and 2019, the Company did not issue or redeem any membership units.

Note 7. Financial Highlights

        The financial highlights represent the per unit operating performance, return and ratios for the non-managing members’ class, taken as a whole, for the six months ended June 30, 2020 and 2019. These financial highlights consist of the operating performance, the internal rate of return (“IRR”) since inception of the Company, and the expense and net investment income ratios which are annualized except for the on-recurring expenses.

        The IRR, net of all fees and carried interest (if any), is computed based on actual dates of the cash inflows (capital contributions), outflows (capital distributions), and the ending capital at the end of the respective period (residual value) of the non-managing members’ capital account.

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Notes to Unaudited Financial Statements

        The following summarizes the Company’s financial highlights for the six months ended June 30, 2020 and 2019:

	Six Months Ended June 30,
	2020			2019
Per unit operating performance:
Net asset value per unit, beginning of period	$	37,222		$	39,630
Increase in members’ capital from operations (1):
Net investment income	242			549
Net change in unrealized appreciation on investment	80			481
Total increase in members’ capital from operations	322			1,030
Distributions to member (2):
Capital distributions	(1,582)			(2,249)
Net decrease in members’ capital resulting from distributions	(1,582)			(2,249)
Net asset value per unit, end of period	$	35,962		$	38,411
Ratios to average net assets:
Expenses	0.28		%	0.21		%
Net investment income	1.33		%	2.76		%
IRR, beginning of period	6.40		%	6.56		%
IRR, end of period	6.07		%	6.46		%

_______________

(1)The per unit data was derived by using the weighted average units outstanding during the applicable periods, which were 6,638 units and 6,639 units for the six months ended June 30, 2020 and 2019, respectively.

(2)The per unit data for distributions reflects the actual amount of distributions paid per unit during the periods.

Note 8. Subsequent Events

Management has evaluated subsequent events through the date the financial statements were available to be issued. Management has determined that there are no material events that would require adjustment to, or disclosure in, the Company’s financial statements.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

        The information contained in this section should be read in conjunction with our unaudited financial statements and related notes thereto and other financial information included elsewhere in this quarterly report on Form 10-Q. In this report, the “Company,” “we,” “us” and “our” refer to Terra Secured Income Fund 5, LLC.

FORWARD-LOOKING STATEMENTS

        We make forward-looking statements in this quarterly report on Form 10-Q within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). For these statements, we claim the protections of the safe harbor for forward-looking statements contained in such Sections. The forward-looking statements contained in this quarterly report on Form 10-Q may include, but are not limited to, statements as to:

•our expected financial performance, operating results and our ability to make distributions to our members in the future;

•the potential negative impacts of COVID-19 on the global economy and the impacts of COVID-19 on our financial condition, results of operations, liquidity and capital resources and business operations;

•actions that may be taken by governmental authorities to contain the COVID-19 outbreak or to treat its impact;

•the availability of attractive risk-adjusted investment opportunities in our target asset class and other real estate-related investments that satisfy our objectives and strategies;

•the origination or acquisition of our targeted assets, including the timing of originations or acquisitions;

•volatility in our industry, interest rates and spreads, the debt or equity markets, the general economy or the real estate market specifically, whether the results of market events or otherwise;

•changes in our investment objectives and business strategy;

•the availability of financing on acceptable terms or at all;

•the performance and financial condition of our borrowers;

•changes in interest rates and the market value of our assets;

•borrower defaults or decreased recovery rates from our borrowers;

•changes in prepayment rates on our loans;

•our use of financial leverage;

•actual and potential conflicts of interest with any of the following affiliated entities: Terra Fund Advisors, LLC (“Terra Fund Advisors” or the “Manager”), Terra REIT Advisors, LLC (“Terra REIT Advisors”), Terra Income Advisors, LLC; Terra Capital Partners, LLC (“Terra Capital Partners”), our sponsor; Terra JV, LLC (“Terra JV”); Terra Income Fund 6, Inc. (“Terra Fund 6”);Terra Secured Income Fund 5 International; Terra Income Fund International; Terra Secured Income Fund 7, LLC (“Terra Fund 7”); Terra Property Trust, Inc. (“Terra Property Trust”); Terra International Fund 3, L.P. (“Terra International 3”); Terra International Fund 3 REIT, LLC (“TIF3 REIT”), a subsidiary of Terra International 3; Terra Capital Advisors, LLC; Terra Capital Advisors 2, LLC; Terra Income Advisors 2, LLC; or any of their affiliates;

•our dependence on our Manager or its affiliates and the availability of its senior management team and other personnel;

•liquidity transactions that may be available to us in the future, including a liquidation of our assets, a sale of our company or an initial public offering and listing of the shares of common stock of Terra Property Trust on a national securities exchange, and the timing of any such transactions;

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•actions and initiatives of the U.S. federal, state and local government and changes to the U.S. federal, state and local government policies and the execution and impact of these actions, initiatives and policies;

•limitations imposed on our business and our ability to satisfy complex rules in order for us to maintain our exclusion from registration under the Investment Company Act of 1940, as amended (the “1940 Act”), and Terra Property Trust to maintain its qualification as a real estate investment trust (“REIT”) for U.S. federal income tax purposes; and

•the degree and nature of our competition.

In addition, words such as “anticipate,” “believe,” “expect” and “intend” indicate a forward-looking statement, although not all forward-looking statements include these words. The forward-looking statements contained in this quarterly report on Form 10-Q involve risks and uncertainties. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason, including the factors set forth in “Part I — Item 1A. Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2019 and in “Part II - Item 1A. Risk Factors” in this quarterly report on Form 10-Q. Other factors that could cause actual results to differ materially include:

•changes in the economy;

•risks associated with possible disruption in our operations or the economy generally due to terrorism or natural disasters; and

•future changes in laws or regulations and conditions in our operating areas.

We have based the forward-looking statements included in this quarterly report on Form 10-Q on information available to us on the date of this quarterly report on Form 10-Q. Except as required by the federal securities laws, we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise. Members are advised to consult any additional disclosures that we may make directly to members or through reports that we may file in the future with the Securities and Exchange Commission (the “SEC”), including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

Overview

        We are a real estate credit focused company that originates, structures, funds and manages high yielding commercial real estate investments, including mezzanine loans, first mortgage loans, subordinated mortgage loans and preferred equity investments throughout the United States. Our loans finance the acquisition, construction, development or redevelopment of quality commercial real estate in the United States. We focus on the origination of middle market loans in the approximately $10 million to $50 million range, to finance properties primarily in primary and secondary markets. We believe loans of this size are subject to less competition, offer higher risk adjusted returns than larger loans with similar risk metrics and facilitate portfolio diversification. We were formed as a Delaware limited liability company on April 24, 2013 and commenced operations on August 8, 2013. We make substantially all of our investments and conduct substantially all of our real estate lending business through Terra Property Trust, which has elected to be taxed as a REIT for U.S. federal income tax purposes commencing with its taxable year ended December 31, 2016. Our objectives are to (i) preserve our members’ capital contributions, (ii) realize income from our investments and (iii) make monthly distributions to our members from cash generated from investments. There can be no assurances that we will be successful in meeting our objectives.

        On January 1, 2016, Terra Secured Income Fund, LLC (“Terra Fund 1”), Terra Fund Secured Income Fund 2, LLC (“Terra Fund 2”), Terra Secured Income Fund 3, LLC (“Terra Fund 3”) and Terra Secured Income Fund 4, LLC (“Terra Fund 4”) merged with and into our subsidiaries (collectively, the “Terra Funds”) through a series of separate mergers (collectively, the “Merger”). Following the Merger, we contributed the consolidated portfolio of our net assets and the net assets of the Terra Funds to Terra Property Trust in exchange for all of the shares of common stock of Terra Property Trust. We elected to engage in these transactions, which we refer to as the “REIT formation transactions,” to make our investments through Terra Property Trust and to provide our members with a more broadly diversified portfolio of assets, while at the same time providing us with enhanced access to capital and borrowings, lower operating costs and enhanced opportunities for growth.

        On March 2, 2020, Terra Fund 1, Terra Fund 2 and Terra Fund 3 merged with and into Terra Fund 4, with Terra Fund 4 continuing as the surviving company (the “Terra Fund Merger”), and we consolidated our holdings of shares of common stock of Terra Property Trust in Terra Fund 4. Subsequent to the Terra Fund Merger, the legal name of Terra Fund 4 was changed to

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Terra JV, LLC. On March 2, 2020, Terra Property Trust engaged in a series of transactions pursuant to which Terra Property Trust issued an aggregate of 4,574,470.35 shares of its common stock in exchange for the settlement of an aggregate of $49.8 million of participation interests in loans that Terra Property Trust owned, cash of $25.5 million and other working capital. On April 29, 2020, Terra Property Trust repurchased, at a purchase price of $17.02 per share, 212,691 shares of common stock that Terra Property Trust had previously sold to TIF3 REIT on September 30, 2019. As of June 30, 2020, Terra JV held 87.4% of the issued and outstanding shares of Terra Property Trust’s common stock with the remainder held by TIF3 REIT, and we and Terra Fund 7 owned an 87.6% and 12.4% percentage interest, respectively, in Terra JV. Accordingly, as of June 30, 2020, we indirectly beneficially owned 76.5% of the outstanding shares of common stock of Terra Property Trust through Terra JV.

Recent Developments

        During the first half of 2020, there was a global outbreak of a novel coronavirus, or COVID-19, which has spread to over 200 countries and territories, including the United States, and has spread to every state in the United States. The World Health Organization has designated COVID-19 as a pandemic, and numerous countries, including the United States, have declared national emergencies with respect to COVID-19. The global impact of the outbreak has been rapidly evolving, and as cases of COVID-19 have continued to be identified in additional countries, many countries have reacted by instituting quarantines and restrictions on travel, closing financial markets and/or restricting trading, and limiting operations of non-essential offices and retail centers. Such actions are creating disruption in global supply chains, increasing rates of unemployment and adversely impacting many industries. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown.

        While we believe that compelling opportunities for us will emerge as a result of the economic downtown caused by the COVID-19 pandemic, we are in the early stages of assessing its full impact on the commercial real estate market. While it has had a demonstrable effect on employment, the economy and the national psyche, the impact of the pandemic on property values has yet to be fully realized. The reason is that property values are the result of slow moving forces, including consumer behavior, supply and demand for space, availability and pricing of mortgage financing and investor demand for property. As these factors become clear and commercial real estate is repriced accordingly, we believe there will be abundant opportunities available to experienced alternative lenders such as us to provide financing for property acquisition, refinancing, development and redevelopment on attractive terms that reflect the new realities of the economy. 

Portfolio Summary

The following tables provide a summary of Terra Property Trust’s net loan portfolio as of June 30, 2020 and December 31, 2019:

	June 30, 2020
	Fixed Rate			Floating Rate (1)(2)(3)			Total Gross Loans			Obligations under Participation Agreements			Total Net Loans
Number of loans	9			13			22			9			22
Principal balance	$	101,693,122		$	312,410,817		$	414,103,939		$	78,116,748		$	335,987,191
Amortized cost	102,402,613			312,045,669			414,448,282			78,246,519			336,201,763
Fair value	102,651,392			310,024,461			412,675,853			77,898,387			334,777,466
Weighted average coupon rate	10.29		%	8.91		%	9.25		%	10.83		%	8.88		%
Weighted-average remaining term (years)	1.33			1.92			1.77			1.42			1.85

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	December 31, 2019
	Fixed Rate			Floating Rate (1)(2)(3)			Total Gross Loans			Obligations under Participation Agreements		Total Net Loans
Number of loans	8			15			23			13		23
Principal balance	$	70,692,767		$	306,695,550		$	377,388,317		102,564,795		$	274,823,522
Amortized cost	71,469,137			307,143,631			378,612,768			103,186,327		275,426,441
Fair value	71,516,432			307,643,983			379,160,415			103,188,783		275,971,632
Weighted average coupon rate	11.93		%	9.13		%	9.65		%	11.77	%	8.87		%
Weighted-average remaining term (years)	2.28			2.09			2.13			1.58		2.33

_______________

(1)These loans pay a coupon rate of London Interbank Offered Rate (“LIBOR”) plus a fixed spread. Coupon rate shown was determined using LIBOR of 0.16% and 1.76% as of June 30, 2020 and December 31, 2019.

(2)As of June 30, 2020 and December 31, 2019, amounts included $142.8 million and $114.8 million, respectively, of senior mortgages used as collateral for $95.4 million and $81.1 million, respectively, of borrowings under a repurchase agreement. These borrowings bear interest at an annual rate of LIBOR plus a spread ranging from 2.00% to 2.50% as of June 30, 2020 and LIBOR plus a spread ranging from 2.25% to 2.50% as of December 31, 2019.

(3)As of June 30, 2020 and December 31, 2019, eleven and twelve of these loans, respectively, are subject to a LIBOR floor.

        In addition to its net loan portfolio, as of June 30, 2020 and December 31, 2019, Terra Property Trust owns 4.9 acres of adjacent land acquired via deed in lieu of foreclosure and a multi-tenant office building acquired via foreclosure. The land and building and related lease intangible assets and liabilities had a net carrying value of $64.6 million and $66.2 million as of June 30, 2020 and December 31, 2019, respectively. The mortgage loan payable encumbering the office building had an outstanding principal amount of $44.5 million and $44.6 million as of June 30, 2020 and December 31, 2019, respectively.

Portfolio Investment Activity 

        For the three months ended June 30, 2020 and 2019, Terra Property Trust invested $2.6 million and $8.6 million in new and add-on loans, respectively, and had $5.2 million and $9.8 million of repayments, respectively, resulting in net repayments of $2.5 million and $1.2 million respectively. For the six months ended June 30, 2020 and 2019, Terra Property Trust invested $11.9 million and $28.3 million in new and add-on loans, respectively, and had $15.1 million and $45.2 million of repayments, respectively, resulting in net repayments of $3.2 million and $16.9 million, respectively. Amounts are net of obligations under participation agreements and borrowings under the master repurchase agreement.

        In addition, in March 2020, Terra Property Trust issued 4,574,470.35 shares of common stock in exchange for the settlement of an aggregate of $49.8 million of participation interests in loans that it owned, cash of $25.5 million and other working capital. In connection with the transactions, the related participation obligations were settled.

For each of the three and six months ended June 30, 2020, Terra Property Trust sold $5.8 million of marketable securities and recognized net gains on sale of marketable securities of $1.1 million. 

In January 2019, Terra Property Trust acquired 4.9 acres of adjacent land encumbering a $14.3 million first mortgage via deed in lieu of foreclosure in exchange for the release of the first mortgage and related fees and expenses.

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Portfolio Information

        The tables below set forth the types of assets in Terra Property Trust’s portfolio, as well as the property type and geographic location of the properties securing the loans in the portfolio, on a net loan basis, which represents Terra Property Trust’s proportionate share of the loans, based on its economic ownership of these loans.

	June 30, 2020								December 31, 2019
Loan Structure	Principal Balance		Amortized Cost		Fair Value		% of Total		Principal Balance		Amortized Cost		Fair Value		% of Total
First mortgages	$	191,170,829	$	191,848,919	$	191,374,666	57.1	%	$	160,984,996	$	160,948,585	$	161,736,057	58.6	%
Preferred equity investments	112,647,758		113,046,936		111,183,208		33.2	%	84,202,144		84,485,061		84,191,396		30.5	%
Mezzanine loans	32,168,604		32,620,202		32,219,592		9.6	%	29,636,382		29,992,795		30,044,179		10.9	%
Allowance for loan losses	—		(1,314,294)		—		—	%	—		—		—		—	%
Total loan investments	$	335,987,191	336,201,763		334,777,466		99.9	%	$	274,823,522	275,426,441		275,971,632		100.0	%
Marketable securities			168,563		236,085		0.1	%			—		—		—	%
Total			$	336,370,326	$	335,013,551	100.0	%			$	275,426,441	$	275,971,632	100.0	%

	June 30, 2020								December 31, 2019
Property Type	Principal Balance		Amortized Cost		Fair Value		% of Total		Principal Balance		Amortized Cost		Fair Value		% of Total
Office	$	123,909,027	$	124,175,135	$	123,160,449	36.8	%	$	119,331,369	$	119,145,879	$	119,597,533	43.2	%
Student housing	42,637,550		43,033,299		42,839,458		12.8	%	26,470,740		26,725,148		26,638,826		9.7	%
Multifamily	83,117,283		83,616,924		83,347,144		24.9	%	49,017,844		49,331,885		49,386,995		17.9	%
Hotel	46,444,284		46,631,795		46,695,787		13.9	%	41,239,194		41,327,772		41,539,239		15.1	%
Infill land	30,759,047		30,919,047		29,731,856		8.9	%	29,644,375		29,756,375		29,588,829		10.7	%
Industrial	7,000,000		7,000,000		6,866,583		2.0	%	7,000,000		7,000,000		7,081,127		2.6	%
Condominium	2,120,000		2,139,857		2,136,189		0.6	%	2,120,000		2,139,382		2,139,083		0.8	%
Allowance for loan losses	—		(1,314,294)		—		—	%	—		—		—		—	%
Total loan investments	$	335,987,191	$	336,201,763	$	334,777,466	99.9	%	$	274,823,522	275,426,441		275,971,632		100.0	%
Marketable securities			168,563		$	236,085	0.1	%			—		—		—	%
Total			$	336,370,326	$	335,013,551	100.0	%			$	275,426,441	$	275,971,632	100.0	%

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	June 30, 2020								December 31, 2019
Geographic Location	Principal Balance		Amortized Cost		Fair Value		% of Total		Principal Balance		Amortized Cost		Fair Value		% of Total
United States
California	$	141,982,974	$	142,446,080	$	142,295,102	42.5	%	$	102,774,905	$	102,622,718	$	103,333,019	37.4	%
Georgia	68,980,282		69,295,471		68,929,645		20.6	%	61,772,764		61,957,443		62,073,996		22.5	%
New York	52,033,441		52,128,360		50,038,360		14.9	%	52,909,847		53,029,923		52,670,818		19.1	%
North Carolina	28,405,604		28,551,242		28,566,778		8.5	%	28,283,950		28,421,676		28,440,960		10.3	%
Washington	18,500,000		18,635,259		18,855,194		5.6	%	13,525,556		13,618,636		13,680,588		5.0	%
Massachusetts	7,000,000		7,000,000		6,866,583		2.0	%	7,000,000		7,000,000		7,081,127		2.6	%
Texas	3,613,000		3,647,936		3,645,676		1.1	%	2,450,000		2,472,244		2,474,149		0.9	%
Illinois	2,836,668		2,860,776		2,864,728		0.9	%	2,209,189		2,227,593		8,018,753		2.9	%
Other (1)	12,635,222		12,950,933		12,715,400		3.8	%	3,897,311		4,076,208		(1,801,778)		(0.7)	%
Allowance for loan losses	—		(1,314,294)		—		—	%	—		—		—		—	%
Total loan investments	$	335,987,191	336,201,763		334,777,466		99.9	%	$	274,823,522	275,426,441		275,971,632		100.0	%
Marketable securities			168,563		236,085		0.1	%			—		—		—	%
Total			$	336,370,326	$	335,013,551	100.0	%			$	275,426,441	$	275,971,632	100.0	%

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(1)Other includes $7.1 million and $0.3 million of unused portion of a credit facility, $2.6 million and a $1.7 million of loans with collateral located in Kansas, and $3.0 million and $1.9 million of loans with collateral located in South Carolina at June 30, 2020 and December 31, 2019, respectively.

Factors Impacting Operating Results

        Our results of operations are affected by a number of factors and primarily depend on, among other things, the level of the interest income generated by Terra Property Trust from targeted assets, the market value of our assets and the supply of, and demand for, real estate-related loans, including mezzanine loans, first mortgage loans, subordinated mortgage loans, preferred equity investments and other loans related to high quality commercial real estate in the United States, and the financing and other costs associated with our business. Interest income and borrowing costs of Terra Property Trust may vary as a result of changes in interest rates, which could impact the net interest we receive on our assets. Our operating results may also be impacted by conditions in the financial markets and unanticipated credit events experienced by borrowers under our loan assets.

Market Risk

        Terra Property Trust’s loans are highly illiquid and there is no assurance that it will achieve its investment objectives, including targeted returns. Due to the illiquidity of the loans, valuation of Terra Property Trust’s loans may be difficult, as there generally will be no established markets for these loans.

        The COVID-19 pandemic has resulted in extreme volatility in a variety of global markets, including the real estate-related debt markets. U.S. financial markets, in particular, are experiencing limited liquidity and forced selling by certain market participants with insufficient liquidity available to meet current obligations, which puts further downward pressure on asset prices. In reaction to these tumultuous and unpredictable market conditions, banks and other lenders have generally restricted lending activity and requested margin posting or repayments where applicable for secured loans collateralized by assets with depressed valuations. Terra Property Trust’s repurchase agreement contains margin call provisions that provide the lender with certain rights in the event of a decline in the market value of the assets purchased under the repurchase agreement. Upon the occurrence of a margin deficit event, the lender may require Terra Property Trust to make a payment to reduce the outstanding obligation to eliminate any margin deficit.

Credit Risk

        Credit risk represents the potential loss that Terra Property Trust would incur if the borrowers failed to perform pursuant to the terms of their obligations to Terra Property Trust. Terra Property Trust manages exposure to credit risk by limiting exposure to any one individual borrower and any one asset class. Additionally, Terra Property Trust employs an asset management

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approach and monitors the portfolio of loans, through, at a minimum, quarterly financial review of property performance including net operating income, loan-to-value ratio, debt service coverage ratio, and the debt yield. Terra Property Trust also requires certain borrowers to establish a cash reserve, as a form of additional collateral, for the purpose of providing for future interest or property-related operating payments.

        The performance and value of Terra Property Trust’s loans depend upon the sponsors’ ability to operate or manage the development of the respective properties that serve as collateral so that each property’s value ultimately supports the repayment of the loan balance. Mezzanine loans and preferred equity investments are subordinate to senior mortgage loans and, therefore, involve a higher degree of risk. In the event of a default, mezzanine loans and preferred equity investments will be satisfied only after the senior lender’s investment is fully recovered. As a result, in the event of a default, Terra Property Trust may not recover all of its investments.

        In addition, Terra Property Trust is exposed to the risks generally associated with the commercial real estate market, including variances in occupancy rates, capitalization rates, absorption rates, and other macroeconomic factors beyond its control. Terra Property Trust seeks to manage these risks through its underwriting and asset management processes.

        The COVID-19 pandemic has significantly impacted the commercial real estate markets, causing reduced occupancy, requests from tenants for rent deferral or abatement, and delays in construction and development projects currently planned or underway. These negative conditions may persist into the future and impair Terra Property Trust’s borrowers’ ability to pay principal and interest due to Terra Property Trust under its loan agreements.

        We and Terra Property Trust maintain all of our cash at financial institutions which, at times, may exceed the amount insured by the Federal Deposit Insurance Corporation.

Concentration Risk

        Terra Property Trust holds real estate-related loans. Thus, its loan portfolio may be subject to a more rapid change in value than would be the case if it were required to maintain a wide diversification among industries, companies and types of loans. The result of such concentration in real estate assets is that a loss in such loans could materially reduce Terra Property Trust’s capital.

Liquidity Risk

        Liquidity risk represents the possibility that we may not be able to sell, directly or indirectly, our equity interest in Terra Property Trust or Terra JV at a reasonable price in times of low trading volume, high volatility and financial stress.

Interest Rate Risk

        Interest rate risk represents the effect from a change in interest rates, which could result in an adverse change in the fair value of our interest-bearing financial instruments. With respect to Terra Property Trust’s business operations, increases in interest rates, in general, may over time cause: (i) the interest expense associated with variable rate borrowings to increase; (ii) the value of real estate-related loans to decline; (iii) coupons on variable rate loans to reset, although on a delayed basis, to higher interest rates; (iv) to the extent applicable under the terms of Terra Property Trust’s investments, prepayments on real estate-related loans to slow, and (v) to the extent we enter into interest rate swap agreements as part of Terra Property Trust’s hedging strategy, the value of these agreements to increase.

        Conversely, decreases in interest rates, in general, may over time cause: (i) the interest expense associated with variable rate borrowings to decrease; (ii) the value of real estate-related loans to increase; (iii) coupons on variable rate real estate-related loans to reset, although on a delayed basis, to lower interest rates (iv) to the extent applicable under the terms of Terra Property Trust’s investments, prepayments on real estate-related loans to increase, and (v) to the extent Terra Property Trust enters into interest rate swap agreements as part of its hedging strategy, the value of these agreements to decrease.

Prepayment Risk

        Prepayments can either positively or adversely affect the yields on Terra Property Trust’s loans. Prepayments on debt instruments, where permitted under the debt documents, are influenced by changes in current interest rates and a variety of economic, geographic and other factors beyond our control, and consequently, such prepayment rates cannot be predicted with certainty. If Terra Property Trust does not collect a prepayment fee in connection with a prepayment or are unable to invest the proceeds of such prepayments received, the yield on the portfolio will decline. In addition, Terra Property Trust may acquire

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assets at a discount or premium and if the asset does not repay when expected, the anticipated yield may be impacted. Under certain interest rate and prepayment scenarios Terra Property Trust may fail to recoup fully its cost of acquisition of certain loans.

Extension Risk

        Extension risk is the risk that Terra Property Trust’s assets will be repaid at a slower rate than anticipated and generally increases when interest rates rise. In which case, to the extent Terra Property Trust has financed the acquisition of an asset, Terra Property Trust may have to finance its asset at potentially higher costs without the ability to reinvest principal into higher yielding securities because borrowers prepay their mortgages at a slower pace than originally expected, adversely impacting its net interest spread, and thus its net interest income.

Real Estate Risk

        The market values of commercial and residential mortgage assets are subject to volatility and may be affected adversely by a number of factors, including, but not limited to, national, regional and local economic conditions (which may be adversely affected by industry slowdowns and other factors); local real estate conditions; changes or continued weakness in specific industry segments; construction quality, age and design; demographic factors; retroactive changes to building or similar codes; pandemics; natural disasters and other acts of god. In addition, decreases in property values reduce the value of the collateral and the potential proceeds available to a borrower to repay the underlying loans, which could also cause Terra Property Trust to suffer losses. Market volatility has been particularly heightened due to the COVID-19 global pandemic. COVID-19 has disrupted economic activities and could have a continued significant adverse effect on economic and market conditions including limited lending from financial institutions, depressed asset values, and limited market liquidity.

Use of Leverage

        Terra Property Trust deploys moderate amounts of leverage as part of its operating strategy, which may consist of borrowings under first mortgage financings, warehouse facilities, repurchase agreements and other credit facilities. While borrowing and leverage present opportunities for increasing total return, they may have the effect of potentially creating or increasing losses.

Results of Operations

        The following table presents the comparative results of our operations for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		Change		2020		2019		Change
Investment income
Dividend income	$	681,685	$	—	$	681,685	$	1,946,123	$	3,922,875	$	(1,976,752)
Other operating income	34		90		(56)		178		392		(214)
Total investment income	681,719		90		681,629		1,946,301		3,923,267		(1,976,966)
Operating expenses
Professional fees	161,100		98,119		62,981		335,199		271,333		63,866
Other	1,295		6,076		(4,781)		2,744		8,959		(6,215)
Total operating expenses	162,395		104,195		58,200		337,943		280,292		57,651
Net investment income (loss)	519,324		(104,105)		623,429		1,608,358		3,642,975		(2,034,617)
Net change in unrealized appreciation on investment	2,813,973		1,609,008		1,204,965		527,675		3,198,259		(2,670,584)
Net increase in members’ capital resulting from operations	$	3,333,297	$	1,504,903	$	1,828,394	$	2,136,033	$	6,841,234	$	(4,705,201)

Dividend Income

        Dividend income associated with our indirect ownership of Terra Property Trust primarily represents our proportionate share of Terra Property Trust’s net income for the period. Any excess of distributions received from Terra Property Trust over

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its net income is recorded as return of capital. As of June 30, 2020 and December 31, 2019, we indirectly beneficially owned 76.5% through Terra JV and directly owned 98.6%, respectively, of the outstanding shares of common stock of Terra Property Trust.

        For the three months ended June 30, 2020 and 2019, we received distributions of $3.4 million and $7.6 million, or $0.23 and $0.51 per share, from Terra Property Trust and/or Terra JV, as applicable, of which $0.7 million and zero was recorded as dividend income and $2.7 million and $7.6 million was recorded as return of capital, respectively. For the six months ended June 30, 2020 and 2019, we received distributions of $11.2 million and $15.2 million, or $0.76 and $1.02 per share, from Terra Property Trust and/or Terra JV, as applicable, of which $1.9 million and $3.9 million was recorded as dividend income and $9.3 million and $11.3 million was recorded as return of capital, respectively.

For the three months ended June 30, 2020 as compared to the same period in 2019, Terra Property Trust’s net income increased by $2.8 million, primarily due to (i) a decrease in professional fees of $2.2 million as a result of $2.4 million of professional fees directly incurred for the three months ended June 30, 2019, and which were previously deferred, in contemplation of Terra Property Trust becoming a public entity; (ii) a decrease in net real estate operating loss of $1.2 million, primarily as a result of a $1.6 million of impairment charge recorded for the three months ended June 30, 2019 on a piece of land in order to reduce the carrying value of the land to its estimated fair value; and (iii) a gain on sale of marketable securities of $1.1 million for the three months ended June 30, 2020; partially offset by (i) a decrease in net interest income of $0.9 million as a result of a decrease in the weighted average outstanding principal balance of net investments resulting from a higher volume of loan repayments than new loan originations and a decrease in the weighted average interest rate on net investments driven by new loan originations having lower coupon rates than those of the loans that were repaid and (ii) an increase in fees paid and operating expenses reimbursed to Terra Property Trust’s Manager of $0.7 million as a result of an increase in assets under management and an increase in allocation ratio in relation to affiliated funds managed by Terra Property Trust’s Manager and its affiliates.

        For the six months ended June 30, 2020 as compared to the same period in 2019, Terra Property Trust’s net income decreased by $0.5 million, primarily due to (i) a decrease in net interest income of $2.0 million as a result of a decrease in the weighted average outstanding principal balance of net investments resulting from a higher volume of loan repayments than new loan originations and a decrease in the weighted average interest rate on net investments driven by new loan originations having lower coupon rates than those of the loans that were repaid; (ii) a provision for loan losses of $1.3 million on five loans with a loan risk rating of “4”; (iii) an increase in fees paid and operating expenses reimbursed to Terra Property Trust’s Manager of $1.1 million as a result of an increase in assets under management and an increase in allocation ratio in relation to affiliated funds managed by Terra Property Trust’s Manager and its affiliates; and (iv) a net loss of $0.3 million on extinguishment of obligations under participation agreement; partially offset by (i) a decrease in professional fees of $2.1 million as a result of $2.4 million of professional fees directly incurred for the three months ended June 30, 2019 as described above; (ii) a decrease in net real estate operating loss of $1.0 million primarily as a result of a $1.6 million of impairment charge described above partially offset by increase in real estate taxes; and (iii) a gain on sale of marketable securities of $1.1 million for the three months ended June 30, 2020.

Net Loan Portfolio

        In assessing the performance of Terra Property Trust’s loans, we believe it is appropriate to evaluate the loans on an economic basis, that is, gross loans net of obligations under participation agreements, mortgage loan payable and repurchase agreement payable.

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         The following tables present a reconciliation of Terra Property Trust’s loan portfolio from a gross basis to a net basis for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30, 2020			Three Months Ended June 30, 2019
	Weighted Average Principal Amount (1)		Weighted Average Coupon Rate (2)	Weighted Average Principal Amount (1)		Weighted Average Coupon Rate (2)
Total portfolio
Gross loans	$	403,107,647	9.3%	$	383,193,015	10.8%
Obligations under participation agreements	(73,120,692)		10.9%	(95,337,563)		12.2%
Repurchase agreement payable	(94,768,307)		3.8%	(78,140,846)		4.8%
Net loans (3)	$	235,218,648	11.0%	$	209,714,606	12.4%
Senior loans
Gross loans	$	212,859,783	6.7%	$	143,125,696	7.9%
Obligations under participation agreements	(27,807,684)		9.1%	(6,800,000)		12.4%
Repurchase agreement payable	(94,768,307)		3.8%	(78,140,846)		4.8%
Net loans (3)	$	90,283,792	9.1%	$	58,184,850	11.6%
Subordinated loans (4)
Gross loans	$	190,247,864	12.2%	$	240,067,319	12.5%
Obligations under participation agreements	(45,313,008)		12.0%	(88,537,563)		12.2%
Net loans (3)	$	144,934,856	12.2%	$	151,529,756	12.7%

	Six Months Ended June 30, 2020			Six Months Ended June 30, 2019
	Weighted Average Principal Amount (1)		Weighted Average Coupon Rate (2)	Weighted Average Principal Amount (1)		Weighted Average Coupon Rate (2)
Total portfolio
Gross loans	$	395,636,304	9.4%	$	368,486,550	11.0%
Obligations under participation agreements	(81,213,576)		11.5%	(96,415,887)		12.2%
Repurchase agreement payable	(94,617,024)		3.9%	(61,443,378)		4.8%
Net loans (3)	$	219,805,704	11.0%	$	210,627,285	12.3%
Senior loans
Gross loans	$	201,392,405	6.7%	$	127,213,974	8.3%
Obligations under participation agreements	(23,368,896)		9.7%	(9,200,440)		12.3%
Repurchase agreement payable	(94,617,024)		3.8%	(61,443,378)		4.8%
Net loans (3)	$	83,406,485	9.2%	$	56,570,156	11.4%
Subordinated loans (4)
Gross loans	$	194,243,899	12.2%	$	241,272,576	12.5%
Obligations under participation agreements	(57,844,680)		12.2%	(87,215,447)		12.2%
Net loans (3)	$	136,399,219	12.2%	$	154,057,129	12.7%

_______________

(1)Amount is calculated based on the number of days each loan is outstanding.

(2)Amount is calculated based on the underlying principal amount of each loan.

(3)The weighted average coupon rate represents net interest income over the period calculated using the weighted average coupon rate and weighted average principal amount shown on the table (interest income on the loans less interest expense) divided by the weighted average principal amount of the net loans during the period.

(4)Subordinated loans include mezzanine loans, preferred equity investments and credit facilities.

        For the three and six months ended June 30, 2020 as compared to the same periods in 2019, the decrease in weighted average coupon rate was primarily due to a higher volume of loan originations with lower coupon rates.

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Net Change in Unrealized Appreciation on Investment

        Net change in unrealized appreciation or depreciation on investment reflects the change in Terra Property Trust’s fair value during the reporting period. There may be fluctuations in unrealized gains and losses of the underlying portfolio as loans within the portfolio approach their respective maturity dates. In addition, the unrealized gains or losses in the portfolio may fluctuate over time due to changes in the market yields.

For the three months ended June 30, 2020 as compared to the same period in 2019, net change in unrealized appreciation on investment increased by $1.2 million, reflecting an increase in dividends classified as return of capital, which reduced the cost basis of our investment in Terra Property Trust and/or Terra JV, as applicable. As of June 30, 2020, the fair value of Terra Property Trust’s loans and debt was substantially at par.

For the six months ended June 30, 2020 as compared to the same period in 2019, net change in unrealized appreciation on investment decreased by $2.7 million as a result of a net decline in fair value of Terra Property Trust’s loans and debt due to widening credit spreads partially offset by decreases in underlying index rates as a result of the macro-economic conditions impacted by the COVID-19 outbreak.

Net Increase in Members’ Capital Resulting from Operations

        For the three and six months ended June 30, 2020 as compared to the same periods in 2019, the net increase in members’ capital resulting from operations of increased by $1.8 million and decreased by $4.7 million, respectively.

Financial Condition, Liquidity and Capital Resources

        Liquidity is a measure of our ability to meet potential cash requirements, including funding and maintaining our assets and operations, making distributions to our members and other general business needs. Our primary cash requirements for the next twelve months are making the discretionary recurring distributions to our members. We expect to use cash distributions received from Terra Property Trust to meet such cash requirements. During the three months ended June 30, 2020, Terra Property Trust paid distributions of $0.0805, $0.0738 and $0.0738 per share of common stock for each of the months of April, May and June, respectively, which translated to a distribution rate of approximately 5.5% of the fair value per share. Going forward, Terra Property Trust intends to target a distribution rate of approximately 5.0% of the fair value per share, which Terra Property Trust believes is more closely aligned with its earnings per share. Distributions are made at the discretion of Terra Property Trust’s board and will depend upon, among other things, its actual results of operations and liquidity.

A total of $26.1 million of Terra Property Trust’s obligations under participation agreements will mature in the next twelve months and Terra Property Trust expects to use the proceeds from the repayment of the corresponding investments to repay the participation obligations. Additionally, Terra Property Trust expects to fund approximately $81.6 million of the unfunded commitments to borrowers during the next twelve months. Terra Property Trust expects to maintain sufficient cash on hand to fund such commitments through matching these commitments with principal repayments on outstanding loans. Additionally, Terra Property Trust had $44.5 million of borrowings outstanding under a mortgage loan payable that bear interest at an annual rate of LIBOR plus 3.85% with a LIBOR floor of 2.23%, that is collateralized by an office building. The mortgage loan payable matures on September 27, 2020. Terra Property Trust expects to extend the maturity of the loan payable for another year. Terra Property Trust may also issue additional equity, equity-related and debt securities to fund its investment strategies. Terra Property Trust may issue these securities to unaffiliated third parties or to vehicles advised by affiliates of Terra Capital Partners or third parties. As part of its capital raising transactions, Terra Property Trust may grant to one or more of these vehicles certain control rights over its activities including rights to approve major decisions it takes as part of its business.

        On December 12, 2018, Terra Property Trust entered into a master repurchase agreement that provides for advances of up to $150 million in the aggregate, which Terra Property Trust expects to use to finance certain secured performing commercial real estate loans, including senior mortgage loans. Advances under the master repurchase agreement accrue interest at an annual rate equal to the sum of (i) the 30-day LIBOR and (ii) the applicable spread, and have a maturity date of December 12, 2020. Terra Property Trust expects to extend the maturity of the master repurchase agreement for another year or refinance it with a different facility. As of June 30, 2020, the weighted average interest rate on borrowings outstanding under the master repurchase agreement was approximately 3.79%, calculated using the 30-day LIBOR of 0.16% as of June 30, 2020. As of June 30, 2020, the amount remaining available under the repurchase agreement was $54.6 million.

        Under the master repurchase agreement, on the second anniversary of the closing date and on each anniversary thereafter, Terra Property Trust is required to pay the buyer the difference, if positive, between $4.2 million and the interest paid during the immediately preceding 12-month period. Terra Property Trust currently expects the actual interest paid in calendar year 2020 on borrowings under the master repurchase agreement to be less than $4.2 million. As a result, Terra Property Trust

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accrued approximately $0.3 million for six months ended June 30, 2020 to make up for the difference between the actual interest paid and the $4.2 million.

        The master repurchase agreement contains margin call provisions that provide the buyer with certain rights in the event of a decline in the market value of the assets purchased under the master repurchase agreement. Upon the occurrence of a margin deficit event, the buyer may require the seller to make a payment to reduce the outstanding obligation to eliminate any margin deficit. During the six months ended June 30, 2020, Terra Property Trust received a margin call on one of the borrowings and as a result, made a repayment of $3.4 million to reduce the outstanding obligation under the master repurchase agreement.

        On June 20, 2019, Terra Property Trust entered into a credit agreement that provides for revolving credit loans of up to $35.0 million in the aggregate, which Terra Property Trust expects to use for short term financing needed to bridge the timing of anticipated loans repayments and funding obligations. Borrowings under the revolving credit facility can be either prime rate loans or LIBOR rate loans and accrue interest at an annual rate of prime rate plus 1% or LIBOR plus 4% with a floor of 6%. The credit facility matures on September 3, 2020. As of June 30, 2020, the revolving credit facility was fully utilized. Terra Property Trust has sufficient cash on hand to repay the amount outstanding under the revolving credit facility.

Cash Flows Provided by Operating Activities

2020 — For the six months ended June 30, 2020, cash flows provided by operating activities were $10.8 million, primarily due to $11.2 million of dividends received from Terra Property Trust and/or Terra JV, as applicable, of which $9.3 million was recorded as a return of capital.

2019 — For the six months ended June 30, 2019, cash flows provided by operating activities were $14.9 million, primarily due to $15.2 million of dividends received from Terra Property Trust, of which $11.3 million was recorded as a return of capital.

Cash Flows used in Financing Activities

2020 — For the six months ended June 30, 2020, cash flows used in financing activities were $10.5 million primarily related to distributions paid to members.

2019 — For the six months ended June 30, 2019, cash flows used in financing activities was $14.9 million, primarily related to distributions paid to members.

Critical Accounting Policies and Use of Estimates

        Our financial statements are prepared in conformity with United States generally accepted accounting principles (“U.S. GAAP”), which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Critical accounting policies are those that require the application of management’s most difficult, subjective or complex judgments, often because of the need to make estimates about the effect of matters that are inherently uncertain and that may change in subsequent periods. In preparing the financial statements, management has made estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. In preparing the financial statements, management has utilized available information, including industry standards and the current economic environment, among other factors, in forming its estimates and judgments, giving due consideration to materiality. Actual results may differ from these estimates. In addition, other companies may utilize different estimates, which may impact the comparability of our results of operations to those of companies in similar businesses. As we execute our expected operating plans, we will describe additional critical accounting policies in the notes to our future financial statements in addition to those discussed below.

Fair Value Measurements

        The fair value of our investment is categorized based on the priority of the inputs to the valuation technique and categorized into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

        Our investment was recorded at fair value on our statements of assets and liabilities and were categorized based on the inputs valuation techniques as follows:

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•Level 1. Quoted prices for identical assets or liabilities in an active market.

•Level 2. Financial assets and liabilities whose values are based on the following:

◦Quoted prices for similar assets or liabilities in active markets.

◦Quoted prices for identical or similar assets or liabilities in non-active markets.

◦Pricing models whose inputs are observable for substantially the full term of the asset or liability.

◦Pricing models whose inputs are derived principally from or corroborated by observable market data for substantially full term of the asset or liability.

•Level 3. Prices or valuation techniques based on inputs that are both unobservable and significant to the overall fair value measurement.

        Unobservable inputs reflect our assumptions about the factors that market participants would use in pricing an asset or liability, and would be based on the best information available.

        Any changes to the valuation methodology will be reviewed by management to ensure the changes are appropriate. As markets and products develop and the pricing for certain products becomes more transparent, we will continue to refine our valuation methodologies. The methods used may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while we anticipate that our valuation methods will be appropriate and consistent with other market participants, the use of different methodologies, or assumptions, to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. We will use inputs that are current as of the measurement date, which may include periods of market dislocation, during which price transparency may be reduced.

Income Taxes

        No provision for U.S. federal and state income taxes has been made in the accompanying financial statements, as individual members are responsible for their proportionate share of our taxable income. We, however, may be liable for New York City Unincorporated Business Tax (the “NYC UBT”) and similar taxes of various other municipalities. New York City imposes the NYC UBT at a statutory rate of 4% on net income generated from ordinary business activities carried on in New York City. For the three and six months ended June 30, 2020 and 2019, none of our income was subject to the NYC UBT.

        We did not have any uncertain tax positions that met the recognition or measurement criteria of Accounting Standards Codification 740-10-25, Income Taxes, nor did we have any unrecognized tax benefits as of the periods presented herein. We recognize interest and penalties, if any, related to unrecognized tax liabilities as income tax expense in our statements of operations. For the three and six months ended June 30, 2020 and 2019, we did not incur any interest or penalties. Although we file federal and state tax returns, our major tax jurisdiction is federal. Our 2015-2019 federal tax years remain subject to examination by the Internal Revenue Service.

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Contractual Obligations of Terra Property Trust

        The following table provides a summary of Terra Property Trust’s contractual obligations at June 30, 2020:

	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Obligations under participation    agreements — principal (1)	$	78,116,748	26,109,932		52,006,816		$	—	$	—
Mortgage loan payable — principal (2)	44,481,855		44,481,855		—		—		—
Repurchase agreement payable —    principal (3)	95,356,360		95,356,360		—		—		—
Revolving credit facility payable —    principal (4)	35,000,000		35,000,000		—		—		—
Interest on borrowings (5)	14,760,282		9,401,889		5,358,393		—		—
Unfunded lending commitments (6)	92,711,431		81,641,924		11,069,507		—		—
Ground lease commitment (7)	83,825,813		1,264,500		2,529,000		2,529,000		77,503,313
	$	444,252,489	$	293,256,460	$	70,963,716	$	2,529,000	$	77,503,313

^{___________________________}

(1)In the normal course of business, Terra Property Trust enters into participation agreements with related parties, and to a lesser extent, non-related parties, whereby it transfers a portion of the loans to them. These loan participations do not qualify for sale treatment. As such, the loans remain on its consolidated balance sheets and the proceeds are recorded as obligations under participation agreements. Similarly, interest earned on the entire loan balance is recorded within “Interest income” and the interest related to the participation interest is recorded within “Interest expense from obligations under participation agreements” in the consolidated statements of operations. Terra Property Trust has no direct liability to a participant under our participation agreements with respect to the underlying loan, and the participants’ share of the loan is repayable only from the proceeds received from the related borrower/issuer of the loans.

(2)Terra Property Trust has an option to extend the maturity of the loan by two years subject to certain conditions provided in the loan agreement. Amount excludes unamortized origination and exit fees of $0.3 million.

(3)Terra Property Trust may extend the maturity date of the master repurchase agreement for a period of one year. Amount excludes unamortized deferred financing costs of $0.8 million.

(4)Terra Property Trust’s revolving credit facility was scheduled to mature on June 20, 2020. In June and July 2020, Terra Property Trust amended the credit agreement twice to extend the maturity to September 3, 2020. Terra Property Trust has sufficient cash on hand to repay the amount outstanding under the revolving credit facility.

(5)Interest was calculated using the applicable annual variable interest rate and balance outstanding at June 30, 2020. Amount represents interest expense through maturity plus exit fee as application.

(6)Certain of Terra Property Trust’s loans provide for a commitment to fund the borrower at a future date. As of June 30, 2020, Terra Property Trust had eight of such loans with total funding commitments of $305.6 million, of which $212.9 million had been funded.

(7)Represents rental obligation under the ground lease, inclusive of imputed interest, for Terra Property Trust’s office building that it acquired through foreclosure.

Management Agreement with Terra REIT Advisors

        Terra Property Trust currently pays the following fees to Terra REIT Advisors pursuant to a management agreement:

        Origination and Extension Fee. An origination fee in the amount of 1.0% of the amount used to originate, acquire, fund, acquire or structure real estate-related loans, including any third-party expenses related to such loan. In the event that the term of any real estate-related loan is extended, Terra REIT Advisors also receives an extension fee equal to the lesser of (i) 1.0% of the principal amount of the loan being extended or (ii) the amount of fee paid by the borrower in connection with such extension.

        Asset Management Fee. A monthly asset management fee at an annual rate equal to 1.0% of the aggregate funds under management, which includes the loan origination amount or aggregate gross acquisition cost, as applicable, for each real estate-related loan and cash held by Terra Property Trust.

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        Asset Servicing Fee. A monthly asset servicing fee at an annual rate equal to 0.25% of the aggregate gross origination price or aggregate gross acquisition price for each real estate related loan then held by Terra Property Trust (inclusive of closing costs and expenses).

        Disposition Fee. A disposition fee in the amount of 1.0% of the gross sale price received by Terra Property Trust from the disposition of each loan, but not upon the maturity, prepayment, workout, modification or extension of a loan unless there is a corresponding fee paid by the borrower, in which case the disposition fee will be the lesser of (i) 1.0% of the principal amount of the loan and (ii) the amount of the fee paid by the borrower in connection with such transaction. If Terra Property Trust takes ownership of a property as a result of a workout or foreclosure of a loan, Terra Property Trust will pay a disposition fee upon the sale of such property equal to 1.0% of the sales price.

        Transaction Breakup Fee. In the event that Terra Property Trust receives any “breakup fees,” “busted-deal fees,” termination fees, or similar fees or liquidated damages from a third-party in connection with the termination or non-consummation of any loan or disposition transaction, Terra REIT Advisors will be entitled to receive one-half of such amounts, in addition to the reimbursement of all out-of-pocket fees and expenses incurred by Terra REIT Advisors with respect to its evaluation and pursuit of such transactions.

        In addition to the fees described above, Terra Property Trust reimburses Terra REIT Advisors for operating expenses incurred in connection with services provided to the operations of Terra Property Trust, including Terra Property Trust’s allocable share of Terra REIT Advisors’ overhead, such as rent, employee costs, utilities, and technology costs.

The following table presents a summary of fees paid and costs reimbursed to the predecessor to Terra REIT Advisors and Terra REIT Advisors in the aggregate in connection with providing services to Terra Property Trust:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Origination and extension fee expense (1)	$	250,601	$	117,380	$	688,218	$	800,552
Asset management fee	1,140,426		956,985		2,169,959		1,837,340
Asset servicing fee	253,316		226,764		487,524		431,241
Operating expenses reimbursed to Manager	1,694,875		1,213,314		3,062,064		2,328,518
Disposition fee (2)	220,424		167,091		295,944		637,024
Total	$	3,559,642	$	2,681,534	$	6,703,709	$	6,034,675

_______________

(1)Origination and extension fee expense is generally offset with origination and extension fee income. Any excess is deferred and amortized to interest income over the term of the loan.

(2)Disposition fee is generally offset with exit fee income and included in interest income on the consolidated statements of operations.

Off-Balance Sheet Arrangements

Other than contractual commitments and other legal contingencies incurred in the normal course of our business, we do not have any off-balance sheet financings or liabilities.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We may be subject to financial market risks, including changes in interest rates. To the extent that we borrow money to make investments, our net investment income will be dependent upon the difference between the rate at which we borrow funds and the rate at which we invest these funds. In periods of rising interest rates, our cost of funds would increase, which may reduce our net investment income. As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income.

        As of June 30, 2020, Terra Property Trust had 13 investments with an aggregate principal balance of $253.1 million, net of obligations under participation agreements, that provide for interest income at an annual rate of LIBOR plus a spread, 11 of which are subject to a LIBOR floor. A decrease of 100 basis points in LIBOR would decrease our annual interest income, net of interest expense on participation agreements, by approximately $0.1 million, and an increase of 100 basis points in LIBOR would increase Terra Property Trust’s annual interest income, net of interest expense on participation agreements, by approximately $0.6 million.

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        Additionally, Terra Property Trust had $44.5 million of borrowings outstanding under a mortgage loan payable that bear interest at an annual rate of LIBOR plus 3.85% with a LIBOR floor of 2.23%, that is collateralized by an office building; and $95.4 million of borrowings outstanding under a repurchase agreement that bear interest at an annual rate of LIBOR plus a spread ranging from 2.00% to 2.50% with a LIBOR floor ranging from no floor to 2.52% and collateralized by $142.8 million of first mortgages. A decrease of 100 basis points in LIBOR would decrease Terra Property Trust’s total annual interest expense by approximately $0.04 million and an increase of 100 basis points in LIBOR would increase Terra Property Trust’s annual interest expense by approximately $0.3 million.

         In July 2017, the U.K. Financial Conduct Authority announced that it would cease to compel banks to participate in setting LIBOR as a benchmark by the end of 2021, or the LIBOR transition date. It is unclear whether new methods of calculating LIBOR will be established such that it continues to exist after 2021. The Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions convened by the U.S. Federal Reserve, has recommended Secured Overnight Financing Rate (“SOFR”) as a more robust reference rate alternative to U.S. dollar LIBOR. SOFR is calculated based on overnight transactions under repurchase agreements, backed by Treasury securities. SOFR is observed and backward looking, which stands in contrast with LIBOR under the current methodology, which is an estimated forward-looking rate and relies, to some degree, on the expert judgment of submitting panel members. Given that SOFR is a secured rate backed by government securities, it will be a rate that does not take into account bank credit risk (as is the case with LIBOR). SOFR is therefore likely to be lower than LIBOR and is less likely to correlate with the funding costs of financial institutions. Whether or not SOFR attains market traction as a LIBOR replacement tool remains in question. As such, the future of LIBOR at this time is uncertain.

        Potential changes, or uncertainty related to such potential changes, may adversely affect the market for LIBOR-based loans, including Terra Property Trust’s portfolio of LIBOR-indexed, floating-rate loans, or the cost of its borrowings. In addition, changes or reforms to the determination or supervision of LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR, which could have an adverse impact on the market for LIBOR-based loans, including the value of the LIBOR-indexed, floating-rate loans in Terra Property Trust’s portfolio, or the cost of its borrowings. The potential effect of the phase-out or replacement of LIBOR on Terra Property Trust’s cost of capital and net investment income cannot yet be determined.

We may hedge against interest rate fluctuations by using standard hedging instruments, such as futures, options and forward contracts, subject to the requirements of the 1940 Act. While hedging activities may insulate us against adverse changes in interest rates, they may also limit our ability to participate in benefits of lower interest rates with respect to our portfolio of investments with fixed interest rates. For the six months ended June 30, 2020 and 2019, we did not engage in interest rate hedging activities.

In addition, we may have risks regarding portfolio valuation. See “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies — Fair Value Measurements” in this quarterly report on Form 10-Q.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15(b) under the Exchange Act, we carried out an evaluation, under the supervision and with the participation of our management, including the chief executive officer and chief financial officer of our Manager (performing functions equivalent to those a principal executive officer and principal financial officer of our company would perform if we had any officers), of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2020. Based on that evaluation, the chief executive officer and chief financial officer of our Manager concluded that our disclosure controls and procedures were effective to provide reasonable assurance that we would meet our disclosure obligations.

Changes in Internal Control Over Financial Reporting

        During the most recent fiscal quarter, there was no change in our internal controls over financial reporting, as defined under

Rule 13a-15(f) under the Exchange Act, that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

PART II – OTHER INFORMATION

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Item 1. Legal Proceedings.

Neither we, Terra Property Trust, Terra JV nor our Manager is currently subject to any material legal proceedings, nor, to our knowledge, are material legal proceedings threatened against us, Terra Property Trust, Terra JV or our Manager. From time to time, we, Terra Property Trust and individuals employed by our Manager or its affiliates may be a party to certain legal proceedings in the ordinary course of business. While the outcome of these legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a material effect upon our financial condition or results of operations.

Item 1A. Risk Factors.

        There have been no material changes from the risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2019 other than as set forth below.

Major public health issues, including the current outbreak of COVID-19, and related disruptions in the U.S. and global economy and financial markets have adversely impacted and could continue to adversely impact or disrupt our financial condition and results of operations.

        The recent outbreak of COVID-19 in many countries continues to adversely impact global economic activity and has contributed to significant volatility in financial markets. On March 11, 2020, the World Health Organization publicly characterized COVID-19 as a pandemic. On March 13, 2020, the President of the United States declared the COVID-19 outbreak a national emergency. The global impact of the outbreak has been rapidly evolving, and as cases of the virus increased around the world, governments and organizations have implemented a variety of actions to mobilize efforts to mitigate the ongoing and expected impact. Many governments, including where real estate is located that secures or underlies a significant portion of Terra Property Trust's commercial real estate loans, have reacted by instituting quarantines, restrictions on travel, school closures, bans on public events and on public gatherings, “shelter in place” or “stay at home” rules, restrictions on types of business that may continue to operate, with exceptions, in certain cases, available for certain essential operations and businesses, and/or restrictions on types of construction projects that may continue. Further, such actions have created, and we expect will continue to create, disruption in real estate financing transactions and the commercial real estate market and adversely impacted a number of industries. The outbreak could have a continued adverse impact on economic and market conditions and continue to cause regional, national and global economic slowdowns and potentially trigger recessions in any or all of these areas.

        In the United States, there have been a number of federal, state and local government initiatives applicable to a significant number of mortgage loans, to manage the spread of the virus and its impact on the economy, financial markets and continuity of businesses of all sizes and industries. On March 27, 2020, the U.S. Congress approved, and President Trump signed into law, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The CARES Act provides approximately $2 trillion in financial assistance to individuals and businesses resulting from the outbreak of COVID-19. The CARES Act, among other things, provides certain measures to support individuals and businesses in maintaining solvency through monetary relief, including in the form of financing and loan forgiveness and/or forbearance. Although this action by the federal government, together with other actions taken at the federal, regional and local levels, are intended to support these economies, there is no guarantee that such measures will provide sufficient relief to avoid continued adverse effects on the economy and potentially a recession. Similar actions have been taken by governments around the globe but as is the case in the United States there is no assurance that such measures will prevent further economic disruptions, which may be significant, around the world.

        We believe that our and Terra Property Trust's ability, as well as that of Terra REIT Advisors, LLC ("Terra REIT Advisors"), the external manager of Terra Property Trust, and our Manager, to operate, our and Terra Property Trust's level of business activity and the profitability of our and Terra Property Trust's business, as well as the values of, and the cash flows from, the loan assets Terra Property Trust owns have been, and will continue to be, impacted by the effects of COVID-19 and could in the future be impacted by another pandemic or other major public health issues. While we, Terra Property Trust, Terra REIT Advisors and our Manager have implemented risk management and contingency plans and taken preventive measures and other precautions, no predictions of specific scenarios can be made with respect to the COVID-19 pandemic and such measures may not adequately predict the impact on our or Terra Property Trust's business from such events.

 The effects of COVID-19 have adversely impacted the value of Terra Property Trust's loan assets, and our and Terra Property Trust's business, financial condition and results of operations and cash flows. Some of the factors that impacted us and Terra Property Trust to date and may continue to affect us and Terra Property Trust include the following:

•the decline in the value of commercial real estate, which negatively impacts the value of Terra Property Trust's loans, potentially materially;

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•to the extent the value of commercial real estate declines, which would also likely negatively impact the value of the loans Terra Property Trust owns, Terra Property Trust could become subject to additional margin calls under the master repurchase agreement with Goldman Sachs Bank USA, and if Terra Property Trust fails to resolve such margin calls when due by payment of cash or delivery of additional collateral, the lenders may exercise remedies including demanding payment by Terra Property Trust of its aggregate outstanding financing obligations and/or taking ownership of the loans or other assets securing the applicable obligations. Terra Property Trust may not have the funds available to repay such financing obligations, and it may be unable to raise the funds from alternative sources on favorable terms or at all. Forced sales of the loans or other assets that secure Terra Property Trust's financing obligations in order to pay outstanding financing obligations may be on terms less favorable to it than might otherwise be available in a regularly functioning market and could result in deficiency judgments and other claims against Terra Property Trust;

•difficulty accessing debt and equity capital on attractive terms, or at all;

•a severe disruption and instability in the financial markets or deteriorations in credit and financing conditions may affect Terra Property Trust or its borrowers’ ability to make regular payments of principal and interest (whether due to an inability to make such payments, an unwillingness to make such payments, or a waiver of the requirement to make such payments on a timely basis or at all);

•government-mandated moratoriums on the construction, development or redevelopment of properties underlying our construction loans may prevent the completion, on a timely basis or at all, of such projects;

•unavailability of information, resulting in restricted access to key inputs used to derive certain estimates and assumptions made in connection with evaluating loans for impairments and establishing allowances for loan losses;

•Terra Property Trust's ability to remain in compliance with the financial covenants under its borrowings, including in the event of impairments in the value of the loans it owns;

•a general decline in business activity and demand for mortgage financing, servicing and other real estate and real estate-related transactions, which could adversely affect Terra Property Trust's ability to make new investments or to redeploy the proceeds from repayments of its existing investments;

•disruptions to the efficient function of our or Terra Property Trust's operations because of, among other factors, any inability to access short-term or long-term financing for the loans it makes;

•Terra Property Trust's need to sell assets, including at a loss;

•Terra Property Trust’s loan origination activities;

•inability of other third-party vendors Terra Property Trust or we rely on to conduct Terra Property Trust's or our business to operate effectively and continue to support Terra Property Trust's or our business and operations, including vendors that provide IT services, legal and accounting services, or other operational support services;

•effects of legal and regulatory responses to concerns about the COVID-19 pandemic and related public health issues, which could result in additional regulation or restrictions affecting the conduct of Terra Property Trust's or our business; and

•Terra Property Trust's or our ability to ensure operational continuity in the event our business continuity plan is not effective or ineffectually implemented or deployed during a disruption.

        The rapid development and fluidity of the circumstances resulting from this pandemic precludes any prediction as to the ultimate adverse impact of COVID-19. There are no comparable recent events which provide guidance as to the effect of the spread of COVID-19 and a pandemic on our business. Nevertheless, COVID-19 and the current financial, economic and capital markets environment, and future developments in these and other areas present material uncertainty and risk with respect to our performance, financial condition, volume of business, results of operations and cash flows. Moreover, many risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2019 should be interpreted as heightened risks as a result of the impact of the COVID-19 pandemic.

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We may receive distributions from Terra Property Trust on a delayed basis or distributions may decrease over time. Changes in the amount and timing of distributions Terra Property Trust pays or in the tax characterization of distributions Terra Property Trust pays may adversely affect the fair value of our units or may result in our members being taxed on their allocable share of distributions from Terra Property Trust at a higher rate than initially expected.

        Our distributions are driven by a variety of factors, including Terra Property Trust's minimum distribution requirements under the REIT tax laws and Terra Property Trust's REIT taxable income (including certain items of non-cash income) as calculated pursuant to the Internal Revenue Code. Terra Property Trust is generally required to distribute to its stockholders at least 90% of its REIT taxable income, although its reported financial results for GAAP purposes may differ materially from its REIT taxable income.

        In the year ended December 31, 2019, Terra Property Trust paid $30.4 million of cash distributions on its common stock, representing total distributions of $2.03 per share. For the six months ended June 30, 2020, Terra Property Trust's board of directors declared total cash distribution of $0.76 per share that were paid monthly in the same period in which each was declared.

        Terra Property Trust continues to prudently evaluate its liquidity and review the rate of future distributions in light of its financial condition and its applicable minimum distribution requirements under applicable REIT tax laws and regulations. Terra Property Trust may determine to pay distributions on a delayed basis or decrease distributions for a number of factors, including the risk factors described in this quarterly report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2019.

        To the extent Terra Property Trust determines that future distributions would represent a return of capital to investors or would not be required under applicable REIT tax laws and regulations, rather than the distribution of income, Terra Property Trust may determine to discontinue distribution payments until such time that distributions would again represent a distribution of income or be required under applicable REIT tax laws and regulations. Any reduction or elimination of Terra Property Trust’s payment of distributions would not only reduce the amount of distributions you would receive as a holder of our units, but could also have the effect of reducing the fair value of our units and the ability of Terra Property Trust to raise capital in future securities offerings.

        In addition, the rate at which holders of our units are taxed on their allocable share of Terra Property Trust’s distributions and the characterization of such distributions - be it ordinary income, capital gains, or a return of capital - could have an impact on the fair value of our units. After Terra Property Trust announces the expected characterization of distributions Terra Property Trust has paid, the actual characterization (and, therefore, the rate at which holders of our units are taxed on their allocable share of Terra Property Trust’s distributions) could vary from Terra Property Trust’s expectations, including due to errors, changes made in the course of preparing Terra Property Trust’s corporate tax returns, or changes made in response to an audit by the Internal Revenue Service, or the IRS, with the result that holders of our units could incur greater income tax liabilities than expected.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Not applicable.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

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Item 6.  Exhibits.

        The following exhibits are filed with this report. Documents other than those designated as being filed herewith are incorporated herein by reference.

Exhibit No.	Description and Method of Filing
2.1	Agreement and Plan of Merger by and among the registrant, Terra Capital Advisors, LLC, Terra Secured Income Fund Merger Sub, LLC, and Terra Secured Income Fund, dated January 1, 2016 (incorporated by reference to Exhibit 2.1 to the Registration Statement on Form 10 (File No. 000-55780) filed with the SEC on April 28, 2017).
2.2	Agreement and Plan of Merger by and among the registrant, Terra Capital Advisors, LLC, Terra Secured Income Fund Merger Sub 2, LLC, and Terra Secured Income Fund 2, LLC, dated January 1, 2016 (incorporated by reference to Exhibit 2.2 to the Registration Statement on Form 10 (File No. 000-55780) filed with the SEC on April 28, 2017).
2.3	Agreement and Plan of Merger by and among the registrant, Terra Capital Advisors, LLC, Terra Secured Income Fund Merger Sub 3, LLC, and Terra Secured Income Fund 3, LLC, dated January 1, 2016 (incorporated by reference to Exhibit 2.3 to the Registration Statement on Form 10 (File No. 000-55780) filed with the SEC on April 28, 2017).
2.4	Agreement and Plan of Merger by and among the registrant, Terra Capital Advisors, Terra Capital Advisors 2, Terra Secured Income Fund 4, LLC, and Terra Secured Income Fund 4, LLC, dated January 1, 2016 (incorporated by reference to Exhibit 2.4 to the Registration Statement on Form 10 (File No. 000-55780) filed with the SEC on April 28, 2017).
2.5	Contribution Agreement by and among Terra Secured Income Fund, LLC, Terra Secured Income Fund 2, LLC, Terra Secured Income Fund 3, LLC, Terra Secured Income Fund 4, LLC, the registrant, and Terra Property Trust, Inc., dated January 1, 2016 (incorporated by reference to Exhibit 2.5 to the Registration Statement on Form 10 (File No. 000-55780) filed with the SEC on April 28, 2017).
2.6	Amendment No. 1 to the Contribution Agreement by and among Terra Secured Income Fund, LLC, Terra Secured Income Fund 2, LLC, Terra Secured Income Fund 3, LLC, Terra Secured Income Fund 4, LLC, the registrant, and Terra Property Trust, Inc., dated December 31, 2016 (incorporated by reference to Exhibit 2.6 to the Registration Statement on Form 10 (File No. 000-55780) filed with the SEC on April 28, 2017).
2.7	Agreement and Plan of Merger, dated February 28, 2020, by and among Terra Property Trust, Inc., Terra Property Trust 2, Inc. and Terra Secured Income Fund 7, LLC (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K (File No. 000-56117) filed with the SEC on March 5, 2020).
3.1	Amended and Restated Limited Liability Company Agreement of the registrant, dated January 1, 2016 (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form 10 (File No. 000-55780) filed with the SEC on April 28, 2017).
31.1*	Certification of Chief Executive Officer pursuant to Rule 13a-14 under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Chief Financial Officer pursuant to Rule 13a-14 under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32**	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema Document
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document

_______________

* Filed herewith.

** Furnished herewith.

43

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned in the capacities indicated* thereunto duly authorized.

Date: August 10, 2020

TERRA SECURED INCOME FUND 5, LLC
By:	/s/ Vikram S. Uppal
	Vikram S. Uppal
	Chief Executive Officer
	(Principal Executive Officer)
By:	/s/ Gregory M. Pinkus
	Gregory M. Pinkus
	Chief Financial Officer and Chief Operating Officer,
	(Principal Financial and Accounting Officer)

___________

*  The registrant is a limited liability company managed by Terra Fund Advisors, LLC, its sole and managing member and the persons are signing in their respective capacities as officers of Terra Fund Advisors, LLC.

44

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Vikram S. Uppal*, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Terra Secured Income Fund 5, LLC;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 10, 2020
		/s/ Vikram S. Uppal
		Vikram S. Uppal
		Chief Executive Officer
		(Principal Executive Officer)

___________

*  The registrant is a limited liability company managed by Terra Fund Advisors, LLC, its sole and managing member and the persons are signing in their respective capacities as officers of Terra Fund Advisors, LLC.

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULE 13a-14 OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Gregory M. Pinkus*, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Terra Secured Income Fund 5, LLC;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 10, 2020
		/s/ Gregory M. Pinkus
		Gregory M. Pinkus
		Chief Financial Officer and Chief Operating Officer
		(Principal Financial and Principal Accounting Officer)

___________

*  The registrant is a limited liability company managed by Terra Fund Advisors, LLC, its sole and managing member and the persons are signing in their respective capacities as officers of Terra Fund Advisors, LLC.

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Terra Secured Income Fund 5, LLC. (the “Company”) for the quarterly period ended June 30, 2020, as filed with the Securities Exchange Commission on the date hereof (the “Report”), I, Vikram S. Uppal*, Chief Executive Officer of Terra Fund Advisors, LLC, and I, Gregory M. Pinkus*, Chief Financial Officer of Terra Fund Advisors, LLC, each certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to our knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	August 10, 2020
		/s/ Vikram S. Uppal
		Vikram S. Uppal
		Chief Executive Officer
		(Principal Executive Officer)
		/s/ Gregory M. Pinkus
		Gregory M. Pinkus
		Chief Financial Officer and Chief Operating Officer
		(Principal Financial and Principal Accounting Officer)

___________

*  The registrant is a limited liability company managed by Terra Fund Advisors, LLC, its sole and managing member and the persons are signing in their respective capacities as officers of Terra Fund Advisors, LLC.

Pursuant to the Securities and Exchange Commission Release 33-8238, dated June 5, 2003, this certification is being furnished and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or incorporated by reference in any registration statement of the Company filed under the Securities Act of 1933, as amended.

XML

Document Entity Information Document - shares	6 Months Ended
	Jun. 30, 2020	Aug. 10, 2020
Document And Entity Information [Abstract]
Entity Registrant Name	Terra Secured Income Fund 5, LLC
Entity Central Index Key	0001581874
Document Transition Report	false
Entity File Number	000-55780
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	90-0967526
Entity Address, Address Line One	550 Fifth Avenue
Entity Address, Address Line Two	6th Floor
Entity Address, City or Town	New York
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10036
City Area Code	212
Local Phone Number	753-5100
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Jun. 30, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Common Stock, Shares Outstanding		6,637.7
Entity Shell Company	false
Entity Interactive Data Current	Yes
Document Quarterly Report	true
Title of 12(g) Security	Units of Limited Liability Company Interests

XML

Consolidated Statements of Financial Condition - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Assets [Abstract]
Cash and cash equivalents	$ 400,213	$ 97,937
Other assets	11,573	15,064
Assets	238,921,655	247,376,246
Liabilities
Accounts payable and accrued expenses	216,691	271,333
Due to related party	0	38,000
Total liabilities	216,691	309,333
Commitments and Contingencies
Members' capital:
Managing member	0	0
Non-managing members	238,704,964	247,066,913
Total members’ capital	238,704,964	247,066,913
Total liabilities and members' capital	$ 238,921,655	$ 247,376,246
Net asset value per unit	$ 35,962	$ 37,222
Terra JV
Assets [Abstract]
Equity Investment in Terra JV, LLC at Fair Value	$ 238,509,869	$ 0
Terra Property Trust
Assets [Abstract]
Equity Investment in Terra JV, LLC at Fair Value	$ 0	$ 247,263,245

XML

Consolidated Statements of Financial Condition (Parentheticals) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Terra JV
Investment Owned, at Cost	$ 238,509,445	$ 0
Terra Property Trust
Investment Owned, at Cost	$ 0	$ 243,924,852

XML

Consolidated Statements of Operations - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Investment Income, Dividend	$ 681,685	$ 0	$ 1,946,123	$ 3,922,875
Other operating income	34	90	178	392
Total investment income	681,719	90	1,946,301	3,923,267
Operating expenses
Professional fees	161,100	98,119	335,199	271,333
Other	1,295	6,076	2,744	8,959
Total operating expenses	162,395	104,195	337,943	280,292
Net investment income (loss)	519,324	(104,105)	1,608,358	3,642,975
Net change in unrealized appreciation on investment	2,813,973	1,609,008	527,675	3,198,259
Net increase in members’ capital resulting from operations	$ 3,333,297	$ 1,504,903	$ 2,136,033	$ 6,841,234
Per unit data:
Net investment income (loss) per unit	$ 78	$ (16)	$ 242	$ 549
Net increase in members’ capital resulting from operations per unit	$ 502	$ 227	$ 322	$ 1,030
Weighted average units outstanding	6,638	6,639	6,638	6,639

XML

Consolidated Statements of Changes in Members' Capital - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Changes in Members' Capital [Roll Forward]
Balance, beginning of period	$ 238,402,378	$ 260,948,679	$ 247,066,913	$ 263,080,442
Capital distributions	(3,030,711)	(7,468,095)	(10,497,982)	(14,936,189)
Increase in members’ capital resulting from operations:
Net investment income	519,324	(104,105)	1,608,358	3,642,975
Net change in unrealized appreciation on investment	2,813,973	1,609,008	527,675	3,198,259
Net increase in members’ capital resulting from operations	3,333,297	1,504,903	2,136,033	6,841,234
Balance, end of period	238,704,964	254,985,487	238,704,964	254,985,487
Managing
Changes in Members' Capital [Roll Forward]
Balance, beginning of period	0	0	0	0
Capital distributions	0	0	0	0
Increase in members’ capital resulting from operations:
Net investment income	0	0	0	0
Net change in unrealized appreciation on investment	0	0	0	0
Net increase in members’ capital resulting from operations	0	0	0	0
Balance, end of period	0	0	0	0
Non-managing
Changes in Members' Capital [Roll Forward]
Balance, beginning of period	238,402,378	260,948,679	247,066,913	263,080,442
Capital distributions	(3,030,711)	(7,468,095)	(10,497,982)	(14,936,189)
Increase in members’ capital resulting from operations:
Net investment income	519,324	(104,105)	1,608,358	3,642,975
Net change in unrealized appreciation on investment	2,813,973	1,609,008	527,675	3,198,259
Net increase in members’ capital resulting from operations	3,333,297	1,504,903	2,136,033	6,841,234
Balance, end of period	$ 238,704,964	$ 254,985,487	$ 238,704,964	$ 254,985,487

XML

Consolidated Statements of Cash Flows - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Statement of Cash Flows [Abstract]
Net increase in members’ capital resulting from operations	$ 2,136,033	$ 6,841,234
Adjustments to reconcile net increase in members’ capital resulting from operations to net cash provided by operating activities:
Return of capital on investment	9,281,051	11,260,039
Net change in unrealized appreciation on investment	(527,675)	(3,198,259)
Changes in operating assets and liabilities:
Decrease (increase) in other assets	3,491	(14,260)
(Decrease) increase in accounts payable and accrued expenses	(54,642)	8,804
Decrease in due to related party	(38,000)	0
Net cash provided by operating activities	10,800,258	14,897,558
Cash flows from financing activities:
Distributions paid	(10,497,982)	(14,936,189)
Net cash used in financing activities	(10,497,982)	(14,936,189)
Net increase (decrease) in cash and cash equivalents	302,276	(38,631)
Cash and cash equivalents at beginning of period	97,937	131,784
Cash and cash equivalents at end of period	400,213	93,153
Supplemental Non-Cash Disclosure:
Transfer of ownership interest in Terra Property Trust, Inc. to Terra JV, LLC (Note 3)	$ 244,006,890	$ 0

XML

Consolidated Schedules of Investments Statement - USD ($)		6 Months Ended		12 Months Ended
		Jun. 30, 2020		Dec. 31, 2019
Schedule of Investments
Members' Capital		$ 238,704,964		$ 247,066,913
Debt Securities		$ 3,300,000
Series A Preferred Stock | Non-controlled | City Office REIT, Inc | Initial Investment
Schedule of Investments
Interest Rate	[1]	6.63%
Acquisition Date	[1]	Mar. 19, 2020
Maturity Date	[1]	Oct. 04, 2021
Amortized Cost	[1]	$ 104,653
Fair Value	[1]	$ 136,529
% of Members Capital	[1],[2]	0.04%
Preferred Stock, Shares Issued	[1]	5,768
Series A Preferred Stock | Non-controlled | City Office REIT, Inc | Second Investment
Schedule of Investments
Interest Rate	[1]	6.63%
Acquisition Date	[1]	Mar. 26, 2020
Maturity Date	[1]	Oct. 04, 2021
Amortized Cost	[1]	$ 63,910
Fair Value	[1]	$ 99,556
% of Members Capital	[1],[2]	0.04%
Preferred Stock, Shares Issued	[1]	4,206
Series A Preferred Stock | Non-controlled | Pro Rata | City Office REIT, Inc | Initial Investment
Schedule of Investments
Fair Value	[1],[3]	$ 104,445
Series A Preferred Stock | Non-controlled | Pro Rata | City Office REIT, Inc | Second Investment
Schedule of Investments
Fair Value	[1],[3]	76,160
Preferred Stock | Non-controlled
Schedule of Investments
Amortized Cost	[1]	168,563
Fair Value	[1]	$ 236,085
% of Members Capital	[1],[2]	0.08%
Preferred Stock | Non-controlled | Pro Rata
Schedule of Investments
Fair Value	[1],[3]	$ 180,605
Terra Property Trust
Schedule of Investments
Percent of Common Stock Direct Owned				98.60%
Percent Of Common Stock Indrect Owned		76.50%
Amortized Cost		$ 0		$ 243,924,852
Fair Value		0		$ 247,263,245
% of Members Capital				100.10%
Real estate		$ 75,694,708		$ 77,596,475
Terra Property Trust | Controlled
Schedule of Investments
Percent of Common Stock Direct Owned				98.60%
Percent Of Common Stock Indrect Owned		76.50%
Common Stock, Shares, Outstanding				14,912,990
Amortized Cost				$ 243,924,852
Fair Value				$ 247,263,245
% of Members Capital		100.00%		100.10%
Terra JV
Schedule of Investments
Amortized Cost		$ 238,509,445		$ 0
Fair Value		$ 238,509,869		$ 0
% of Members Capital		99.90%
Terra JV | Non-controlled
Schedule of Investments
Equity Method Investment, Ownership Percentage		87.60%
Initial Acquisition | Terra Property Trust | Controlled
Schedule of Investments
Acquisition Date				Jan. 01, 2016
Initial Acquisition | Terra JV | Non-controlled
Schedule of Investments
Acquisition Date		Mar. 02, 2020
Subsequent Acquisition | Terra Property Trust | Controlled
Schedule of Investments
Acquisition Date				Mar. 07, 2016
UNITED STATES | Terra Property Trust
Schedule of Investments
Principal Amount		$ 414,103,939		$ 377,388,317
Amortized Cost		415,762,576		378,612,768
Fair Value	[4]	412,675,853		379,160,415
UNITED STATES | Terra Property Trust | Pro Rata
Schedule of Investments
Fair Value		$ 315,697,028	[3]	$ 373,852,169	[5]
% of Members Capital		132.30%	[2]	151.30%	[6]
UNITED STATES | Terra Property Trust | Mezzanine Loan | Non-controlled
Schedule of Investments
Principal Amount		$ 36,573,007		$ 42,113,654
Amortized Cost		37,062,576		42,671,330
Fair Value		36,672,950	[4]	42,673,996
UNITED STATES | Terra Property Trust | Mezzanine Loan | Non-controlled | Pro Rata
Schedule of Investments
Fair Value	[3]	$ 28,054,807		$ 42,076,559
% of Members Capital	[2]	11.90%		16.90%
UNITED STATES | Terra Property Trust | Preferred Equity Investment | Non-controlled
Schedule of Investments
Principal Amount		$ 155,216,422		$ 157,144,040
Amortized Cost		155,798,883		157,737,763
Fair Value	[4]	153,527,572		157,497,299
UNITED STATES | Terra Property Trust | Preferred Equity Investment | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 117,448,593	[3]	$ 155,292,337	[5]
% of Members Capital		49.20%	[2]	63.00%	[6]
UNITED STATES | Terra Property Trust | First Mortgage | Non-controlled
Schedule of Investments
Principal Amount		$ 222,314,510		$ 178,130,623
Amortized Cost		222,901,117		178,203,675
Fair Value	[4]	222,475,331		178,989,120
UNITED STATES | Terra Property Trust | First Mortgage | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 170,193,628	[3]	$ 176,483,273	[5]
% of Members Capital		71.30%	[2]	71.30%	[6]
UNITED STATES | Terra Property Trust | Real Estate | Non-controlled
Schedule of Investments
Real estate		$ 63,966,026		$ 66,171,666
Mortgage loan payable		44,481,855		44,614,480
Net Real Estate Investment		$ 19,484,171		$ 21,557,186
UNITED STATES | Terra Property Trust | Real Estate | Non-controlled | Pro Rata
Schedule of Investments
% of Members Capital		6.20%	[2],[7]	8.60%	[6]
Net Real Estate Investment		$ 14,905,391	[3]	$ 21,255,385	[5]
UNITED STATES | Obligations Under Participation Agreements | Terra Property Trust
Schedule of Investments
Principal Amount		78,116,748		102,564,795	[8],[9],[10],[11],[12]
Amortized Cost		78,246,519		103,186,327	[8],[9],[10],[11],[12]
Fair Value	[4]	77,898,387		103,188,783	[8],[9],[10],[11],[12]
UNITED STATES | Obligations Under Participation Agreements | Terra Property Trust | Pro Rata
Schedule of Investments
Fair Value		$ 59,592,266	[3]	$ 101,744,140	[5],[8],[9],[10],[11],[12]
% of Members Capital		25.10%	[2]	41.20%	[6],[8],[9],[10],[11],[12]
UNITED STATES | Investment Net | Terra Property Trust
Schedule of Investments
Principal Amount		$ 335,987,191		$ 274,823,522
Amortized Cost		336,201,763		275,426,441
Fair Value	[4]	334,777,466		275,971,632
Allowance for Loan and Lease Losses, Real Estate		(1,314,294)
UNITED STATES | Investment Net | Terra Property Trust | Pro Rata
Schedule of Investments
Fair Value		$ 256,104,762	[3]	$ (272,108,029)	[5]
% of Members Capital		107.20%	[2]	110.10%	[6]
UNITED STATES | CA | Terra Property Trust | Real Estate | Office Building | Non-controlled
Schedule of Investments
Acquisition Date	[13]	Jul. 30, 2018		Jul. 30, 2018
Real estate	[13]	$ 50,570,596		$ 52,776,236
Mortgage loan payable	[13]	44,481,855		44,614,480
Net Real Estate Investment	[13]	$ 6,088,741		8,161,756
Financing Receivable, before Allowance for Credit Loss				$ 54,000,000.0
UNITED STATES | CA | Terra Property Trust | Real Estate | Office Building | Non-controlled | Pro Rata
Schedule of Investments
% of Members Capital	[7],[13]	2.00%	[2]	3.30%	[6]
Net Real Estate Investment	[13]	$ 4,657,887	[3]	$ 8,047,491	[5]
UNITED STATES | PA | Terra Property Trust | Real Estate | Land | Non-controlled
Schedule of Investments
Acquisition Date	[14]	Jan. 09, 2019		Jan. 09, 2019
Real estate	[14]	$ 13,395,430		$ 13,395,430
Mortgage loan payable	[14]	0		0
Net Real Estate Investment	[14]	$ 13,395,430		$ 13,395,430
UNITED STATES | PA | Terra Property Trust | Real Estate | Land | Non-controlled | Pro Rata
Schedule of Investments
% of Members Capital	[7],[14]	4.20%	[2]	5.30%	[6]
Net Real Estate Investment	[14]	$ 10,247,504	[3]	$ 13,207,894	[5]
150 Blackstone River Road, LLC | UNITED STATES | MA | Terra Property Trust | Mezzanine Loan | Industrial | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate		8.50%		8.50%
Interest Rate		8.50%		8.50%
Exit Fee		0.00%		0.00%
Acquisition Date		Sep. 21, 2017		Sep. 21, 2017
Maturity Date		Sep. 06, 2027		Sep. 06, 2027
Principal Amount		$ 7,000,000		$ 7,000,000
Amortized Cost		7,000,000		7,000,000
Fair Value		6,866,583	[4]	7,081,127
150 Blackstone River Road, LLC | UNITED STATES | MA | Terra Property Trust | Mezzanine Loan | Industrial | Non-controlled | Pro Rata
Schedule of Investments
Fair Value	[3]	$ 5,252,936		$ 6,981,991
% of Members Capital	[2]	2.20%		2.80%
The Bristol at Southport, LLC | UNITED STATES | WA | Terra Property Trust | Preferred Equity Investment | Multifamily | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate		12.00%	[15]	12.00%	[8],[10],[11],[12]
Interest Rate		12.00%	[15]	12.00%	[8],[10],[11],[12]
Exit Fee		1.00%	[15]	1.00%	[8],[10],[11],[12]
Acquisition Date		Sep. 22, 2017	[15]	Sep. 22, 2017	[8],[10],[11],[12]
Maturity Date		Sep. 22, 2022	[15]	Sep. 22, 2022	[8],[10],[11],[12]
Principal Amount		$ 23,500,000	[15]	$ 23,500,000	[8],[10],[11],[12]
Amortized Cost		23,671,815	[15]	23,661,724	[8],[10],[11],[12]
Fair Value	[4]	23,951,192	[15]	23,769,361	[8],[10],[11],[12]
The Bristol at Southport, LLC | UNITED STATES | WA | Terra Property Trust | Preferred Equity Investment | Multifamily | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 18,322,662	[3],[15]	$ 23,436,590	[5],[8],[10],[11],[12]
% of Members Capital		7.70%	[2],[15]	9.50%	[6],[8],[10],[11],[12]
2539 Morse, LLC | UNITED STATES | CA | Terra Property Trust | Mezzanine Loan | Student Housing | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate	[10],[11],[12]			11.00%
Interest Rate	[10],[11],[12]			11.00%
Exit Fee	[10],[11],[12]			1.00%
Acquisition Date	[10],[11],[12]			Oct. 20, 2017
Maturity Date	[10],[11],[12]			Nov. 01, 2020
Principal Amount	[10],[11],[12]			$ 7,000,000
Amortized Cost	[10],[11],[12]			7,067,422
Fair Value	[10],[11],[12]			7,069,355
2539 Morse, LLC | UNITED STATES | CA | Terra Property Trust | Mezzanine Loan | Student Housing | Non-controlled | Pro Rata
Schedule of Investments
Fair Value	[5],[10],[11],[12]			$ 6,970,384
% of Members Capital	[6],[10],[11],[12]			2.80%
Austin H. I. Owner LLC | UNITED STATES | TEXAS | Terra Property Trust | Mezzanine Loan | Hotel | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate		12.50%		12.50%	[11],[12]
Interest Rate		12.50%		12.50%	[11],[12]
Exit Fee		1.00%		1.00%	[11],[12]
Acquisition Date		Sep. 30, 2015		Sep. 30, 2015	[11],[12]
Maturity Date		Oct. 06, 2020		Oct. 06, 2020	[11],[12]
Principal Amount		$ 3,613,000		$ 3,500,000	[11],[12]
Amortized Cost		3,647,936		3,531,776	[11],[12]
Fair Value		3,645,676	[4]	3,534,499	[11],[12]
Austin H. I. Owner LLC | UNITED STATES | TEXAS | Terra Property Trust | Mezzanine Loan | Hotel | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 2,788,942	[3]	$ 3,485,016	[5],[11],[12]
% of Members Capital		1.20%	[2]	1.40%	[6],[11],[12]
High Pointe Mezzanine Investments,, LLC | UNITED STATES | SOUTH CAROLINA | Terra Property Trust | Mezzanine Loan | Student Housing | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate		15.00%	[16]	13.00%	[10],[12]
Interest Rate		15.00%	[16]	13.00%	[10],[12]
Exit Fee		1.00%	[16]	1.00%	[10],[12]
Acquisition Date		Dec. 27, 2013	[16]	Dec. 27, 2013	[10],[12]
Maturity Date		Jan. 06, 2024	[16]	Jan. 06, 2024	[10],[12]
Principal Amount		$ 3,000,000	[16]	$ 3,000,000	[10],[12]
Amortized Cost		3,233,789	[16]	3,263,285	[10],[12]
Fair Value		2,984,870	[4],[16]	3,115,139	[10],[12]
High Pointe Mezzanine Investments,, LLC | UNITED STATES | SOUTH CAROLINA | Terra Property Trust | Mezzanine Loan | Student Housing | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 2,283,426	[3],[16]	$ 3,071,527	[5],[10],[12]
% of Members Capital		1.00%	[2],[16]	1.20%	[6],[10],[12]
LD Milipitas Mezz, LLC | UNITED STATES | CA | Terra Property Trust | Mezzanine Loan | Hotel | Non-controlled
Schedule of Investments
Interest Rate		13.00%	[17]	13.00%	[18]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[17]	LIBOR	[18]
Exit Fee		1.00%	[17]	1.00%	[18]
Acquisition Date		Jun. 27, 2018	[17]	Jun. 27, 2018	[18]
Maturity Date		Jun. 27, 2021	[17]	Jun. 27, 2021	[18]
Principal Amount		$ 4,250,000	[17]	$ 3,120,887	[18]
Amortized Cost		4,297,989	[17]	3,150,546	[18]
Fair Value		4,297,730	[4],[17]	3,204,261	[18]
LD Milipitas Mezz, LLC | UNITED STATES | CA | Terra Property Trust | Mezzanine Loan | Hotel | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 3,287,763	[3],[17]	$ 3,159,401	[5],[18]
% of Members Capital		1.40%	[2],[17]	1.30%	[6],[18]
LD Milipitas Mezz, LLC | UNITED STATES | CA | Terra Property Trust | Mezzanine Loan | Hotel | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		10.25%	[17]	10.25%	[18]
LIBOR Floor		2.75%	[17]	2.75%	[18]
SparQ Mezz Borrower, LLC | UNITED STATES | CA | Terra Property Trust | Mezzanine Loan | Multifamily | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate		12.00%	[15]	12.00%	[10],[11],[12]
Interest Rate		12.00%	[15]	12.00%	[10],[11],[12]
Exit Fee		1.00%	[15]	1.00%	[10],[11],[12]
Acquisition Date		Sep. 29, 2017	[15]	Sep. 29, 2017	[10],[11],[12]
Maturity Date		Oct. 01, 2020	[15]	Oct. 01, 2020	[10],[11],[12]
Principal Amount		$ 8,700,000	[15]	$ 8,700,000	[10],[11],[12]
Amortized Cost		8,785,415	[15]	8,783,139	[10],[11],[12]
Fair Value		8,756,821	[4],[15]	8,786,127	[10],[11],[12]
SparQ Mezz Borrower, LLC | UNITED STATES | CA | Terra Property Trust | Mezzanine Loan | Multifamily | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 6,698,968	[3],[15]	$ 8,663,121	[5],[10],[11],[12]
% of Members Capital		2.90%	[2],[15]	3.50%	[6],[10],[11],[12]
Terra JV | Terra Property Trust
Schedule of Investments
Equity Method Investment, Ownership Percentage		87.40%
Stonewall Station Mezz LLC | UNITED STATES | NORTH CAROLINA | Terra Property Trust | Mezzanine Loan | Hotel | Non-controlled
Schedule of Investments
Interest Rate		14.00%	[19],[20]	14.00%	[9],[12]
Exit Fee		1.00%	[19],[20]	1.00%	[9],[12]
Acquisition Date		May 31, 2018	[19],[20]	May 31, 2018	[9],[12]
Maturity Date		May 20, 2021	[19],[20]	May 20, 2021	[9],[12]
Principal Amount		$ 10,010,007	[19],[20]	$ 9,792,767	[9],[12]
Amortized Cost		10,097,447	[19],[20]	9,875,162	[9],[12]
Fair Value		10,121,270	[4],[19],[20]	9,883,488	[9],[12]
Stonewall Station Mezz LLC | UNITED STATES | NORTH CAROLINA | Terra Property Trust | Mezzanine Loan | Hotel | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 7,742,772	[3],[19],[20]	$ 9,745,119	[5],[9],[12]
% of Members Capital		3.20%	[2],[19],[20]	3.90%	[6],[9],[12]
Stonewall Station Mezz LLC | UNITED STATES | NORTH CAROLINA | Terra Property Trust | Mezzanine Loan | Hotel | Current | Non-controlled
Schedule of Investments
Interest Rate		12.00%	[19],[20]	12.00%	[9],[12]
Stonewall Station Mezz LLC | UNITED STATES | NORTH CAROLINA | Terra Property Trust | Mezzanine Loan | Hotel | PIK | Non-controlled
Schedule of Investments
Interest Rate		2.00%	[19],[20]	2.00%	[9],[12]
370 Lex Part Deux, LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Office Building | Non-controlled
Schedule of Investments
Interest Rate		10.70%	[19],[20]	10.70%	[8],[9],[12]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[19],[20]	LIBOR	[8],[9],[12]
Exit Fee		0.00%	[19],[20]	0.00%	[8],[9],[12]
Acquisition Date		Dec. 17, 2018	[19],[20]	Dec. 17, 2018	[8],[9],[12]
Maturity Date		Jan. 09, 2022	[19],[20]	Jan. 09, 2022	[8],[9],[12]
Principal Amount		$ 51,037,529	[19],[20]	$ 48,349,948	[8],[9],[12]
Amortized Cost		51,094,313	[19],[20]	48,425,659	[8],[9],[12]
Fair Value	[4]	49,728,042	[19],[20]	48,236,458	[8],[9],[12]
370 Lex Part Deux, LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Office Building | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 38,041,952	[3],[19],[20]	$ 47,561,148	[5],[8],[9],[12]
% of Members Capital		15.90%	[2],[19],[20]	19.30%	[6],[8],[9],[12]
370 Lex Part Deux, LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Office Building | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		8.25%	[19],[20]	8.25%	[8],[9],[12]
LIBOR Floor		2.44%	[19],[20]	2.44%	[8],[9],[12]
City Gardens 333 LLC | UNITED STATES | CA | Terra Property Trust | Preferred Equity Investment | Multifamily | Non-controlled
Schedule of Investments
Interest Rate		12.00%	[19],[20]	12.00%	[8],[9],[10],[11],[12]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[19],[20]	LIBOR	[8],[9],[10],[11],[12]
Exit Fee		0.00%	[19],[20]	0.00%	[8],[9],[10],[11],[12]
Acquisition Date		Apr. 11, 2018	[19],[20]	Apr. 11, 2018	[8],[9],[10],[11],[12]
Maturity Date		Apr. 01, 2021	[19],[20]	Apr. 01, 2021	[8],[9],[10],[11],[12]
Principal Amount		$ 27,449,731	[19],[20]	$ 28,049,717	[8],[9],[10],[11],[12]
Amortized Cost		27,461,070	[19],[20]	28,056,179	[8],[9],[10],[11],[12]
Fair Value	[4]	27,446,297	[19],[20]	28,057,779	[8],[9],[10],[11],[12]
City Gardens 333 LLC | UNITED STATES | CA | Terra Property Trust | Preferred Equity Investment | Multifamily | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 20,996,417	[3],[19],[20]	$ 27,664,970	[5],[8],[9],[10],[11],[12]
% of Members Capital		8.80%	[2],[19],[20]	11.20%	[6],[8],[9],[10],[11],[12]
City Gardens 333 LLC | UNITED STATES | CA | Terra Property Trust | Preferred Equity Investment | Multifamily | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		9.95%	[19],[20]	9.95%	[8],[9],[10],[11],[12]
LIBOR Floor		2.00%	[19],[20]	2.00%	[8],[9],[10],[11],[12]
NB Private Capital LLC | UNITED STATES | Other States | Terra Property Trust | Preferred Equity Investment | Student Housing | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate	[15],[19],[20]	16.00%
Interest Rate		16.00%	[15],[19],[20]	14.00%	[8],[9],[10],[11],[12]
Loans Receivable, Description of Variable Rate Basis	[8],[9],[10],[11],[12]			LIBOR
Exit Fee		1.00%	[15],[19],[20]	1.00%	[8],[9],[10],[11],[12]
Acquisition Date		Jul. 27, 2018	[15],[19],[20]	Jul. 27, 2018	[8],[9],[10],[11],[12]
Maturity Date		Apr. 16, 2021	[15],[19],[20]	Apr. 16, 2021	[8],[9],[10],[11],[12]
Principal Amount		$ 19,670,115	[15],[19],[20]	$ 20,000,000	[8],[9],[10],[11],[12]
Amortized Cost		19,837,285	[15],[19],[20]	20,166,610	[8],[9],[10],[11],[12]
Fair Value	[4]	19,864,687	[15],[19],[20]	20,180,782	[8],[9],[10],[11],[12]
NB Private Capital LLC | UNITED STATES | Other States | Terra Property Trust | Preferred Equity Investment | Student Housing | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 15,196,486	[3],[15],[19],[20]	$ 19,898,251	[5],[8],[9],[10],[11],[12]
% of Members Capital		6.30%	[2],[15],[19],[20]	8.10%	[6],[8],[9],[10],[11],[12]
NB Private Capital LLC | UNITED STATES | Other States | Terra Property Trust | Preferred Equity Investment | Student Housing | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate	[8],[9],[10],[11],[12]			10.50%
LIBOR Floor	[8],[9],[10],[11],[12]			3.50%
Orange Grove Property Investors LLC | UNITED STATES | CA | Terra Property Trust | Preferred Equity Investment | Condominium | Non-controlled
Schedule of Investments
Interest Rate		12.00%	[19],[20]	12.00%	[9],[12]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[19],[20]	LIBOR	[9],[12]
Exit Fee		1.00%	[19],[20]	1.00%	[9],[12]
Acquisition Date		May 24, 2018	[19],[20]	May 24, 2018	[9],[12]
Maturity Date		Jun. 01, 2021	[19],[20]	Jun. 01, 2021	[9],[12]
Principal Amount		$ 10,600,000	[19],[20]	$ 10,600,000	[9],[12]
Amortized Cost		10,699,082	[19],[20]	10,696,587	[9],[12]
Fair Value	[4]	10,680,949	[19],[20]	10,695,415	[9],[12]
Orange Grove Property Investors LLC | UNITED STATES | CA | Terra Property Trust | Preferred Equity Investment | Condominium | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 8,170,926	[3],[19],[20]	$ 10,545,679	[5],[9],[12]
% of Members Capital		3.40%	[2],[19],[20]	4.30%	[6],[9],[12]
Orange Grove Property Investors LLC | UNITED STATES | CA | Terra Property Trust | Preferred Equity Investment | Condominium | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		8.00%	[19],[20]	8.00%	[9],[12]
LIBOR Floor		4.00%	[19],[20]	4.00%	[9],[12]
REEC Harlem Holdings Company LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Land | Non-controlled
Schedule of Investments
Interest Rate		12.70%		14.30%
Loans Receivable, Description of Variable Rate Basis		LIBOR		LIBOR
Exit Fee		0.00%		0.00%
Acquisition Date		Mar. 09, 2018		Mar. 09, 2018
Maturity Date		Mar. 09, 2023		Mar. 09, 2023
Principal Amount		$ 14,759,047		$ 18,444,375
Amortized Cost		14,759,047		18,444,375
Fair Value	[4]	13,573,859		18,280,168
REEC Harlem Holdings Company LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Land | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 10,384,002	[3]	$ 18,024,246	[5]
% of Members Capital		4.40%	[2]	7.30%	[6]
REEC Harlem Holdings Company LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Land | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		12.50%		12.50%
RS JZ Driggs, LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Multifamily | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate		12.30%	[19],[20],[21]	12.30%	[9],[12]
Interest Rate		12.30%	[19],[20],[21]	12.30%	[9],[12]
Exit Fee		1.00%	[19],[20],[21]	1.00%	[9],[12]
Acquisition Date		May 01, 2018	[19],[20],[21]	May 01, 2018	[9],[12]
Maturity Date		Aug. 01, 2020	[19],[20],[21]	May 01, 2020	[9],[12]
Principal Amount		$ 8,200,000	[19],[20],[21]	$ 8,200,000	[9],[12]
Amortized Cost		8,276,271	[19],[20],[21]	8,286,629	[9],[12]
Fair Value	[4]	8,282,546	[19],[20],[21]	8,277,336	[9],[12]
RS JZ Driggs, LLC | UNITED STATES | NY | Terra Property Trust | Preferred Equity Investment | Multifamily | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 6,336,148	[3],[19],[20],[21]	$ 8,161,453	[5],[9],[12]
% of Members Capital		2.70%	[2],[19],[20],[21]	3.30%	[6],[9],[12]
14th & Alice Street Owner LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Multifamily | Non-controlled
Schedule of Investments
Interest Rate	[21]	9.00%	[20]	9.00%
Loans Receivable, Description of Variable Rate Basis	[21]	LIBOR	[20]	LIBOR
Exit Fee	[21]	0.50%	[20]	0.50%
Acquisition Date	[21]	Mar. 05, 2019	[20]	Mar. 05, 2019
Maturity Date	[21]	Mar. 05, 2022	[20]	Mar. 05, 2022
Principal Amount	[21]	$ 24,510,905	[20]	$ 12,932,034
Amortized Cost	[21]	24,689,333	[20]	12,957,731
Fair Value	[4],[21]	24,407,964	[20]	12,983,863
14th & Alice Street Owner LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Multifamily | Non-controlled | Pro Rata
Schedule of Investments
Fair Value	[21]	$ 18,672,092	[3],[20]	$ 12,802,089	[5]
% of Members Capital	[21]	7.80%	[2],[20]	5.20%	[6]
14th & Alice Street Owner LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Multifamily | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate	[21]	5.75%	[20]	5.75%
LIBOR Floor	[21]	3.25%	[20]	3.25%
1389 Peachtree St LP; 1401 Peachtree St LP; 1409 Peachtree St LP | UNITED STATES | GA | Terra Property Trust | First Mortgage | Office Building | Non-controlled
Schedule of Investments
Interest Rate		4.70%	[22]	6.30%	[23]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[22]	LIBOR	[23]
Exit Fee		0.50%	[22]	0.50%	[23]
Acquisition Date		Feb. 22, 2019	[22]	Feb. 22, 2019	[23]
Maturity Date		Feb. 10, 2022	[22]	Feb. 10, 2022	[23]
Principal Amount		$ 45,671,947	[22]	$ 38,464,429	[23]
Amortized Cost		45,853,379	[22]	38,510,650	[23]
Fair Value	[4]	45,821,197	[22]	38,655,000	[23]
1389 Peachtree St LP; 1401 Peachtree St LP; 1409 Peachtree St LP | UNITED STATES | GA | Terra Property Trust | First Mortgage | Office Building | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 35,053,216	[3],[22]	$ 38,113,830	[5],[23]
% of Members Capital		14.70%	[2],[22]	15.40%	[6],[23]
1389 Peachtree St LP; 1401 Peachtree St LP; 1409 Peachtree St LP | UNITED STATES | GA | Terra Property Trust | First Mortgage | Office Building | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		4.50%	[22]	4.50%	[23]
330 Tryon DE LLC | UNITED STATES | NORTH CAROLINA | Terra Property Trust | First Mortgage | Office Building | Non-controlled
Schedule of Investments
Interest Rate		6.40%	[22]	6.40%	[23]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[22]	LIBOR	[23]
Exit Fee		0.50%	[22]	0.50%	[23]
Acquisition Date		Feb. 07, 2019	[22]	Feb. 07, 2019	[23]
Maturity Date		Mar. 01, 2022	[22]	Mar. 01, 2022	[23]
Principal Amount		$ 22,800,000	[22]	$ 22,800,000	[23]
Amortized Cost		22,896,169	[22]	22,891,149	[23]
Fair Value	[4]	22,898,866	[22]	22,906,207	[23]
330 Tryon DE LLC | UNITED STATES | NORTH CAROLINA | Terra Property Trust | First Mortgage | Office Building | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 17,517,632	[3],[22]	$ 22,585,520	[5],[23]
% of Members Capital		7.40%	[2],[22]	9.00%	[6],[23]
330 Tryon DE LLC | UNITED STATES | NORTH CAROLINA | Terra Property Trust | First Mortgage | Office Building | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		3.85%	[22]	3.85%	[23]
LIBOR Floor		2.51%	[22]	2.51%	[23]
AGRE DCP Palm Springs, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Hotel | Non-controlled
Schedule of Investments
Interest Rate		6.60%	[22]	6.60%	[23]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[22]	LIBOR	[23]
Exit Fee		0.50%	[22]	0.50%	[23]
Acquisition Date		Dec. 12, 2019	[22]	Dec. 12, 2019	[23]
Maturity Date		Jan. 01, 2023	[22]	Jan. 01, 2023	[23]
Principal Amount		$ 32,975,680	[22]	$ 30,184,357	[23]
Amortized Cost		33,030,797	[22]	30,174,455	[23]
Fair Value	[4]	33,084,469	[22]	30,326,076	[23]
AGRE DCP Palm Springs, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Hotel | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 25,309,619	[3],[22]	$ 29,901,511	[5],[23]
% of Members Capital		10.60%	[2],[22]	12.10%	[6],[23]
AGRE DCP Palm Springs, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Hotel | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		4.75%	[22]	4.75%	[23]
LIBOR Floor		1.80%	[22]	1.80%	[23]
MSC Fields Peachtree Retreat LLC | UNITED STATES | GA | Terra Property Trust | First Mortgage | Multifamily | Non-controlled
Schedule of Investments
Interest Rate		5.90%	[22]	5.90%	[23]
Loans Receivable, Description of Variable Rate Basis		LIBOR	[22]	LIBOR	[23]
Exit Fee		0.50%	[22]	0.50%	[23]
Acquisition Date		Mar. 15, 2019	[22]	Mar. 15, 2019	[23]
Maturity Date		Apr. 01, 2022	[22]	Apr. 01, 2022	[23]
Principal Amount		$ 23,308,335	[22]	$ 23,308,335	[23]
Amortized Cost		23,442,092	[22]	23,446,793	[23]
Fair Value	[4]	23,108,448	[22]	23,418,996	[23]
MSC Fields Peachtree Retreat LLC | UNITED STATES | GA | Terra Property Trust | First Mortgage | Multifamily | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 17,677,963	[3],[22]	$ 23,091,130	[5],[23]
% of Members Capital		7.40%	[2],[22]	9.30%	[6],[23]
MSC Fields Peachtree Retreat LLC | UNITED STATES | GA | Terra Property Trust | First Mortgage | Multifamily | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		3.85%	[22]	3.85%	[23]
LIBOR Floor		2.00%	[22]	2.00%	[23]
Patrick Henry Recovery Acquisition, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Office Building | Non-controlled
Schedule of Investments
Interest Rate		4.50%	[22]	4.70%
Loans Receivable, Description of Variable Rate Basis		LIBOR	[22]	LIBOR
Loans Receivable, Basis Spread on Variable Rate		2.95%	[22]	2.95%
LIBOR Floor		1.50%	[22]	1.50%
Exit Fee		0.30%	[22]	0.30%
Acquisition Date		Nov. 25, 2019	[22]	Nov. 25, 2019
Maturity Date		Dec. 01, 2023	[22]	Dec. 01, 2023
Principal Amount		$ 18,000,000	[22]	$ 18,000,000
Amortized Cost		18,038,578	[22]	18,037,329
Fair Value	[4]	17,845,715	[22]	18,042,390
Patrick Henry Recovery Acquisition, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Office Building | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 13,651,972	[3],[22]	$ 17,789,797	[5]
% of Members Capital		5.70%	[2],[22]	7.20%	[6]
TSG-Parcel 1, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Land | Non-controlled
Schedule of Investments
Mortgage Loans On Real Estate Coupon Rate	[19],[20]	15.00%
Interest Rate		15.00%	[19],[20]	12.00%	[9],[11],[12]
Loans Receivable, Description of Variable Rate Basis	[9],[11],[12]			LIBOR
Exit Fee		1.00%	[19],[20]	1.00%	[9],[11],[12]
Acquisition Date		Jul. 10, 2015	[19],[20]	Jul. 10, 2015	[9],[11],[12]
Maturity Date		Dec. 31, 2020	[19],[20]	Mar. 31, 2020	[9],[11],[12]
Principal Amount		$ 18,000,000	[19],[20]	$ 18,000,000	[9],[11],[12]
Amortized Cost		18,180,000	[19],[20]	18,180,000	[9],[11],[12]
Fair Value	[4]	18,177,747	[19],[20]	18,174,634	[9],[11],[12]
TSG-Parcel 1, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Land | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 13,905,976	[3],[19],[20]	$ 17,920,189	[5],[9],[11],[12]
% of Members Capital		5.80%	[2],[19],[20]	7.30%	[6],[9],[11],[12]
TSG-Parcel 1, LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Land | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate	[9],[11],[12]			10.00%
LIBOR Floor	[9],[11],[12]			2.00%
University Park Berkeley LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Student Housing | Non-controlled
Schedule of Investments
Interest Rate		4.50%
Loans Receivable, Description of Variable Rate Basis		LIBOR
Loans Receivable, Basis Spread on Variable Rate		2.95%
LIBOR Floor		1.50%
Exit Fee		0.30%
Acquisition Date		Feb. 27, 2020
Maturity Date		Mar. 01, 2023
Principal Amount		$ 23,250,000
Amortized Cost		23,272,652
Fair Value	[4]	23,304,937
University Park Berkeley LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Student Housing | Non-controlled | Pro Rata
Schedule of Investments
Fair Value	[3]	$ 17,828,277
% of Members Capital	[2]	7.50%
REEC 286 Lenox LLC | UNITED STATES | NY | Terra Property Trust | First Mortgage | Office Building | Non-controlled
Schedule of Investments
Interest Rate				4.70%
Loans Receivable, Description of Variable Rate Basis				LIBOR
Exit Fee				0.00%
Acquisition Date				Aug. 02, 2019
Maturity Date				Sep. 22, 2019
Principal Amount				$ 4,740,000
Amortized Cost				4,740,000
Fair Value	[4]			4,740,000
REEC 286 Lenox LLC | UNITED STATES | NY | Terra Property Trust | First Mortgage | Office Building | Non-controlled | Pro Rata
Schedule of Investments
Fair Value	[5]			$ 4,673,640
% of Members Capital	[6]			1.90%
REEC 286 Lenox LLC | UNITED STATES | NY | Terra Property Trust | First Mortgage | Office Building | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate				2.95%
Windy Hill Pv Five Cm LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Office Building | Non-controlled
Schedule of Investments
Interest Rate		8.10%	[24]	8.10%
Loans Receivable, Description of Variable Rate Basis		LIBOR	[24]	LIBOR
Exit Fee		0.50%	[24]	0.50%
Acquisition Date		Sep. 20, 2019	[24]	Sep. 20, 2019
Maturity Date		Sep. 20, 2022	[24]	Sep. 20, 2022
Principal Amount		$ 13,797,643	[24]	$ 9,701,468
Amortized Cost		13,498,117	[24]	9,265,568
Fair Value	[4]	13,825,988	[24]	9,741,954
Windy Hill Pv Five Cm LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Office Building | Non-controlled | Pro Rata
Schedule of Investments
Fair Value		$ 10,576,881	[3],[24]	$ 9,605,567	[5]
% of Members Capital		4.40%	[2],[24]	3.90%	[6]
Windy Hill Pv Five Cm LLC | UNITED STATES | CA | Terra Property Trust | First Mortgage | Office Building | LIBOR | Non-controlled
Schedule of Investments
Loans Receivable, Basis Spread on Variable Rate		6.00%	[24]	6.00%
LIBOR Floor		2.05%	[24]	2.05%

[1] From time to time, Terra Property Trust might invest in short-term debt and equity securities. These securities are comprised of shares of preferred stock and bonds.

[2] Percentage is based on the Company’s pro rata share of the fair value or net investment value over the Company’s total members’ capital of $238.7 million at June 30, 2020.

[3] Amount represents the Company’s portion, or 76.5%, of the fair value or net investment value.

[4] Because there is no readily available market for these loans, these loans were valued using significant unobservable inputs under Level 3 of the fair value hierarchy and were approved in good faith by Terra REIT Advisors, LLC (“Terra REIT Advisors”), Terra Property Trust’s manager, pursuant to Terra Property Trust’s valuation policy.

[5] Amount represents the Company’s portion, or 98.6%, of the fair value or net investment value.

[6] Percentage is based on the Company’s pro rata share of the fair value or net investment value over the Company’s total members’ capital of $247.1 million at December 31, 2019.

[7] Percentage is based on Terra Property Trust’s net exposure on the property (real estate owned less encumbrance).

[8] Terra Property Trust sold a portion of its interest in this loan through a participation agreement to TPT2, an affiliated fund managed by Terra REIT Advisors.

[9] Terra Property Trust sold a portion of its interest in this loan through a participation agreement to Terra Income Fund 6, Inc., an affiliated fund advised by Terra Income Advisors, an affiliate of our sponsor and Terra Property Trust’s manager.

[10] Terra Property Trust sold a portion of its interests in these loans via participation agreements to Terra Income Fund International, an affiliated fund advised by Terra REIT Advisors.

[11] Terra Property Trust sold a portion of its interests in these loans via participation agreements to Terra Secured Income Fund 5 International, an affiliated fund advised by Terra REIT Advisors.

[12] The loan participations from Terra Property Trust do not qualify for sale accounting and therefore, the gross amount of these loans remain in the consolidated statements of financial condition.

[13] Terra Property Trust acquired this property through foreclosure of a $54.0 million first mortgage. Real estate owned, net amount includes building and building improvements, tenant improvements and lease intangible assets and liabilities, net of accumulated depreciation and amortization.

[14] Terra Property Trust acquired the collateral for this loan via deed in lieu of foreclosure. On June 30, 2019, Terra Property Trust recorded an impairment charge of $1.6 million on the land in order to reduce the carrying value of the land to its estimated fair value, which is the estimated selling price less the cost of sale.

[15] In June 2020, Terra Property Trust amended the credit facility agreement to provide for interest at a fixed rate of 16.00% and to capitalize any unpaid interest to principal.(9)In August 2020, Terra Property Trust extended the maturity of this loan to February 1, 2021.

[16] Terra Property Trust entered into a forbearance agreement with the borrower to allow for more time to make the interest payment.

[17] On June 27, 2018, Terra Property Trust entered into a participation agreement with Terra Income Fund 6, Inc. to purchase a 25% interest, or $4.3 million, in a mezzanine loan. As of June 30, 2020, the commitment was fully funded.

[18] On June 27, 2018, Terra Property Trust entered into a participation agreement with Terra Income Fund 6, Inc. to purchase a 25% interest, or $4.3 million, in a mezzanine loan. As of December 31, 2019, the unfunded commitment was $1.1 million.

[19] Terra Property Trust sold a portion of its interest in this loan through a participation agreement to Terra Income Fund 6, Inc., an affiliated fund advised by Terra Income Advisors, LLC (“Terra Income Advisors”), an affiliate of our sponsor and Terra Property Trust’s manager.

[20] The loan participations from Terra Property Trust do not qualify for sale accounting and therefore, the gross amount of these loans remain in the consolidated balance sheets.

[21] Terra Property Trust sold a portion of its interest in this loan via a participation agreement to a third-party.

[22] These loans were used as collateral for $95.4 million of borrowings under a repurchase agreement.

[23] These loans were used as collateral for $81.1 million of borrowings under a repurchase agreement.

[24] In March 2020, Terra Property Trust restructured the loan into A-note and B-note. In connection with the restructuring, Terra Property Trust sold the A-note to a third-party. However, the sale did not qualify for sale accounting and therefore, the gross amount of the loan remains in the consolidated balance sheets.

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Consolidated Schedules of Investments Consolidated schedule of investment (Parenthetical) - USD ($)		1 Months Ended	6 Months Ended			9 Months Ended	12 Months Ended
		Jun. 27, 2018	Jun. 30, 2020		Jun. 30, 2019	Sep. 30, 2019	Dec. 31, 2019
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Debt Securities			$ 3,300,000
Members' Capital			238,704,964		$ 254,985,487		$ 247,066,913
Non-managing members			238,704,964				$ 247,066,913
First Mortgage
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Securities Loaned or Sold under Agreements to Repurchase, Fair Value Disclosure			$ 95,400,000
Terra Property Trust
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Percent Of Common Stock Indrect Owned			76.50%
Percent of Common Stock Direct Owned							98.60%
Fair Value			$ 0				$ 247,263,245
% of Members Capital							100.10%
Terra Property Trust | Controlled
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Percent Of Common Stock Indrect Owned			76.50%
Percent of Common Stock Direct Owned							98.60%
Fair Value							$ 247,263,245
% of Members Capital			100.00%				100.10%
Terra Property Trust | Terra JV
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Equity Method Investment, Ownership Percentage			87.40%
Terra Property Trust | UNITED STATES
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	[1]		$ 412,675,853				$ 379,160,415
Terra Property Trust | UNITED STATES | Non-controlled | Mezzanine Loan
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value			36,672,950	[1]			42,673,996
Terra Property Trust | UNITED STATES | Non-controlled | First Mortgage
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	[1]		222,475,331				178,989,120
Collateralized Agreements							81,100,000
Terra Property Trust | UNITED STATES | CA | Hotel | LD Milipitas Mezz, LLC | Non-controlled | Mezzanine Loan
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value			$ 4,297,730	[1],[2]			$ 3,204,261	[3]
Interest Rate			13.00%	[2]			13.00%	[3]
Terra Property Trust | UNITED STATES | CA | Hotel | LD Milipitas Mezz, LLC | Participation Interests | Non-controlled | Mezzanine Loan
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Ownership Interest		25.00%
Total Commitment		$ 4,300,000
Terra Property Trust | UNITED STATES | CA | Office Building | Non-controlled | First Mortgage
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Real Estate Acquired Through Foreclosure							$ 54,000,000.0
Terra Property Trust | UNITED STATES | CA | Office Building | Non-controlled | Real Estate
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financing Receivable, before Allowance for Credit Loss							54,000,000.0
Terra Property Trust | UNITED STATES | CA | Office Building | Participation Interests | Non-controlled | Mezzanine Loan
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Ownership Interest		25.00%
Total Commitment		$ 4,300,000
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share, Unfunded Commitments							1,100,000
Terra Property Trust | UNITED STATES | CA | Office Building | Windy Hill Pv Five Cm LLC | Non-controlled | First Mortgage
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value	[1]		$ 13,825,988	[4]			$ 9,741,954
Interest Rate			8.10%	[4]			8.10%
Terra Property Trust | UNITED STATES | PA | Land | Non-controlled | Real Estate
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Impairment charge					$ 1,600,000	$ 1,600,000
Terra Property Trust | UNITED STATES | TEXAS | Hotel | Austin H. I. Owner LLC | Non-controlled | Mezzanine Loan
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Fair Value			$ 3,645,676	[1]			$ 3,534,499	[5],[6]
Interest Rate			12.50%				12.50%	[5],[6]
Terra Fund Five | Terra JV
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Equity Method Investment, Ownership Percentage			87.60%
Terra fund Seven | Terra JV
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Equity Method Investment, Ownership Percentage			12.40%

[1] Because there is no readily available market for these loans, these loans were valued using significant unobservable inputs under Level 3 of the fair value hierarchy and were approved in good faith by Terra REIT Advisors, LLC (“Terra REIT Advisors”), Terra Property Trust’s manager, pursuant to Terra Property Trust’s valuation policy.

[2] On June 27, 2018, Terra Property Trust entered into a participation agreement with Terra Income Fund 6, Inc. to purchase a 25% interest, or $4.3 million, in a mezzanine loan. As of June 30, 2020, the commitment was fully funded.

[3] On June 27, 2018, Terra Property Trust entered into a participation agreement with Terra Income Fund 6, Inc. to purchase a 25% interest, or $4.3 million, in a mezzanine loan. As of December 31, 2019, the unfunded commitment was $1.1 million.

[4] In March 2020, Terra Property Trust restructured the loan into A-note and B-note. In connection with the restructuring, Terra Property Trust sold the A-note to a third-party. However, the sale did not qualify for sale accounting and therefore, the gross amount of the loan remains in the consolidated balance sheets.

[5] Terra Property Trust sold a portion of its interests in these loans via participation agreements to Terra Secured Income Fund 5 International, an affiliated fund advised by Terra REIT Advisors.

[6] The loan participations from Terra Property Trust do not qualify for sale accounting and therefore, the gross amount of these loans remain in the consolidated statements of financial condition.

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Business

6 Months Ended

Jun. 30, 2020

Limited Liability Companies LLCs [Abstract]

Business

Note 1. Business

        Terra Secured Income Fund 5, LLC (the “Company”), is a real estate credit focused company that originates, structures, funds and manages high yielding commercial real estate investments, including mezzanine loans, first mortgage loans, subordinated mortgage loans and preferred equity investments throughout the United States. The Company’s loans finance the acquisition, construction, development or redevelopment of quality commercial real estate in the United States. The Company focuses on the origination of middle market loans in the approximately $10 million to $50 million range, to finance properties in primary and secondary markets. The Company believes loans of this size are subject to less competition, offer higher risk adjusted returns than larger loans with similar risk metrics and facilitate portfolio diversification. The Company was formed as a Delaware limited liability company on April 24, 2013 and commenced operations on August 8, 2013. The Company makes substantially all of its investments and conducts substantially all of its real estate lending business through Terra Property Trust, which has elected to be taxed as a real estate investment trust (“REIT”) for U.S. federal income tax purposes commencing with its taxable year ended December 31, 2016. The Company’s objectives are to (i) preserve its members’ capital contributions, (ii) realize income from its investments and (iii) make monthly distributions to its members from cash generated from investments. There can be no assurances that the Company will be successful in meeting its objectives.

        In December 2015, the members approved the merger of Terra Secured Income Fund, LLC (“Terra Fund 1”), Terra Secured Income Fund 2, LLC (“Terra Fund 2”), Terra Secured Income Fund 3, LLC (“Terra Fund 3”) and Terra Secured Income Fund 4, LLC (“Terra Fund 4”) with and into subsidiaries of the Company (individually, each a “Terra Fund” and collectively, the “Terra Funds”) through a series of separate mergers effective January 1, 2016 (collectively, the “Merger”). Following the Merger, the Company contributed the consolidated portfolio of net assets of the five Terra Funds to Terra Property Trust, a newly-formed and wholly-owned subsidiary of the Company that elected to be taxed as a REIT, in exchange for the shares of common stock of Terra Property Trust. Upon completion of the Merger, the Company became the parent company of Terra Funds 1 through 4 and the direct and indirect sole common stockholder of, and began conducting substantially all of its real estate lending business through, Terra Property Trust.

        On March 2, 2020, Terra Fund 1, Terra Fund 2 and Terra Fund 3 merged with and into Terra Fund 4, with Terra Fund 4 continuing as the surviving company (the “Terra Fund Merger”), and the Company consolidated its holdings of shares of common stock of Terra Property Trust in Terra Fund 4. Subsequent to the Terra Fund Merger, the legal name of Terra Fund 4 was changed to Terra JV. On March 2, 2020, Terra Property Trust engaged in a series of transactions pursuant to which Terra Property Trust issued an aggregate of 4,574,470.35 shares of its common stock in exchange for the settlement of an aggregate of $49.8 million of participation interests in loans that Terra Property Trust owned, cash of $25.5 million and other working capital. As of June 30, 2020, Terra JV held 87.4% of the issued and outstanding shares of Terra Property Trust’s common stock with the remainder held by TIF3 REIT, and the Company and Terra Fund 7 owned an 87.6% and 12.4% percentage interest, respectively, in Terra JV (Note 4). The Company does not consolidate Terra JV because the Company and Terra Fund 7 share joint approval rights with respect to certain major decisions that are taken by Terra JV and Terra Property Trust (Note 4).

        The Company’s investment activities are externally managed by Terra Fund Advisors, LLC (“Terra Fund Advisors”). The Company does not currently have any employees and does not expect to have any employees. Services necessary for the Company’s business are provided by individuals who are employees of the Manager or its affiliates or by individuals who were contracted by the Company or by the Manager or its affiliates to work on behalf of the Company pursuant to the terms of the operating agreement, as amended.

        The Company’s amended and restated operating agreement provides that the Company’s existence will continue until December 31, 2023, unless sooner terminated. However, the Company expects that prior to such date it will consummate a liquidity transaction, which may include an orderly liquidation of its assets or an alternative liquidity event such as a sale of the Company or an initial public offering and listing of Terra Property Trust’s shares of common stock on a national securities exchange. The Manager would pursue an alternative liquidity event only if it believes such a transaction would be in the best interests of the Company’s members.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Significant Accounting Policies

Note 2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

        The interim financial statements have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP”). The financial statements as of December 31, 2019 and for the three and six months ended June 30, 2019 and the period from January 1, 2020 to March 1, 2020 included all of the Company’s accounts and those of its consolidated subsidiaries. All intercompany balances and transactions had been eliminated. As discussed in Note 1, on March 2, 2020, the Company’s subsidiaries completed the Terra Fund Merger. As a result of the Terra Fund Merger, the Company no longer consolidates the subsidiaries. The financial statements as of June 30, 2020 and for the period from March 2, 2020 to June 30, 2020 and the three months ended June 30, 2020 includes all of the Company’s accounts only.

        The accompanying interim financial statements of the Company and related financial information have been prepared pursuant to the requirements for reporting on Form 10-Q and Articles 6 or 10 of Regulation S-X. The Company is an investment company, as defined under U.S. GAAP, and applies accounting and reporting guidance in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services - Investment Companies.

Use of Estimates

        The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. During the first half of 2020, there was a global outbreak of a novel coronavirus (“COVID-19”), which has spread to over 200 countries and territories, including the United States, and has spread to every state in the United States. The World Health Organization has designated COVID-19 as a pandemic, and numerous countries, including the United States, have declared national emergencies with respect to COVID-19. The global impact of the outbreak has been rapidly evolving, and as cases of COVID-19 have continued to be identified in additional countries, many countries have reacted by instituting quarantines and restrictions on travel, closing financial markets and/or restricting trading and operations of non-essential offices and retail centers. Such actions are creating disruption in global supply chains, and adversely impacting many industries. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19 on economic and market conditions. The Company believes the estimates and assumptions underlying its financial statements are reasonable and supportable based on the information available as of June 30, 2020, however uncertainty over the ultimate impact COVID-19 will have on the global economy generally, and the Company’s business in particular, makes any estimates and assumptions as of June 30, 2020 inherently less certain than they would be absent the current and potential impacts of COVID-19. Actual results may ultimately differ from those estimates.

Equity Investment in Terra JV or Terra Property Trust

        Equity investment in Terra JV or Terra Property Trust represents the Company’s equity interest in Terra JV or Terra Property Trust as applicable, which was initially recorded at cost. Subsequent to the asset contribution, the equity investment is reported, at each reporting date, at fair value on the statements of financial condition. Change in fair value is reported in net change in unrealized appreciation or depreciation on investment on the statements of operations.

Revenue Recognition

        Dividend Income: Dividend income associated with the Company’s ownership of Terra JV or Terra Property Trust is recognized on the record date as declared by Terra JV or Terra Property Trust. Any excess of distributions over Terra JV or Terra Property Trust’s cumulative net income are recorded as return of capital.

        Other Operating Income: All other income is recognized when earned.

Cash and Cash Equivalents

The Company considers all highly liquid investments, with original maturities of ninety days or less when purchased, as cash equivalents. Cash and cash equivalents are exposed to concentrations of credit risk. The Company maintains all of its cash at financial institutions which, at times, may exceed the amount insured by the Federal Deposit Insurance Corporation.

Income Taxes

        No provision for U.S. federal and state income taxes has been made in the accompanying financial statements, as individual members are responsible for their proportionate share of the Company’s taxable income. The Company, however, may be liable for New York City Unincorporated Business Tax (the “NYC UBT”) and similar taxes of various other municipalities. New York City imposes the NYC UBT at a statutory rate of 4% on net income generated from ordinary business activities carried on in New York City. For the three and six months ended June 30, 2020 and 2019, none of the Company’s income was subject to the NYC UBT.

        Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statements and tax basis assets and liabilities using enacted tax rates in effect for the year in which differences are expected to reverse. Such deferred tax assets and liabilities were not material.

        The Company did not have any uncertain tax positions that met the recognition or measurement criteria of ASC 740-10-25, Income Taxes, nor did the Company have any unrecognized tax benefits as of the periods presented herein. The Company recognizes interest and penalties, if any, related to unrecognized tax liabilities as income tax expense in its statements of operations. For the three and six months ended June 30, 2020 and 2019, the Company did not incur any interest or penalties. Although the Company files federal and state tax returns, its primary tax jurisdiction is federal. The Company’s 2015-2019 federal tax years remain subject to examination by the Internal Revenue Service.

Recent Accounting Pronouncement

        In February 2016, the FASB issued Accounting Standards Update 2018-13, Fair Value Measurement (Topic 820): Disclosure framework — Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The objective of ASU 2018-13 is to improve the effectiveness of disclosures in the notes to financial statements by facilitating clear communication of information required by U.S. GAAP. The amendments in ASU 2018-13 added, removed and modified certain fair value measurement disclosure requirements. ASU 2018-13 is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The Company adopted ASU 2018-13 on January 1, 2020. The adoption of ASU 2018-13 did not have a material impact on its financial statements and disclosures.

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Investment and Fair Value

6 Months Ended

Jun. 30, 2020

Investments [Abstract]

Investments And Fair Value Measurements [Text Block]

Note 3. Investment and Fair Value

Equity Investment in Terra JV or Terra Property Trust

The Company invested substantially all of its equity capital in the purchase of shares of common stock of Terra Property Trust. On March 2, 2020, Terra Property Trust engaged in a series of transactions pursuant to which Terra Property Trust issued an aggregate of 4,574,470.35 shares of its common stock in exchange for the settlement of an aggregate of $49.8 million of participation interests in loans that Terra Property Trust owned, cash of $25.5 million and other working capital. As of June 30, 2020, Terra JV held 87.4% of the issued and outstanding shares of Terra Property Trust’s common stock with the remainder held by TIF3 REIT, and the Company and Terra Fund 7 owned an 87.6% and 12.4% percentage interest, respectively, in Terra JV, and Terra JV became the Company’s only investment (Note 4).

The following tables present a summary of the Company’s investment at June 30, 2020 and December 31, 2019:

	June 30, 2020
Investment	Cost		Fair Value		% of Members’ Capital
87.6% interest in Terra JV, LLC	$	238,509,445	$	238,509,869	99.9	%

	December 31, 2019
Investment	Cost		Fair Value		% of Members’ Capital
14,912,990 common shares of Terra Property Trust, Inc.	$	243,924,852	$	247,263,245	100.1	%

For the three months ended June 30, 2020 and 2019, the Company received approximately $3.4 million and $7.6 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $2.7 million and $7.6 million were returns of capital, respectively. For the six months ended June 30, 2020 and 2019, the Company received approximately $11.2 million and $15.2 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $9.3 million and $11.3 million were returns of capital, respectively.

        As of June 30, 2020 and December 31, 2019, the Company indirectly beneficially owned 76.5% (Note 4) and directly owned 98.6% of the outstanding shares of common stock of Terra Property Trust, respectively. The following tables present the summarized financial information of Terra Property Trust:

	June 30, 2020		December 31, 2019
Carrying value of loans held for investment	$	414,448,282	$	378,612,768
Real estate owned, net	75,694,708		77,596,475
Cash, cash equivalent and restricted cash	102,945,300		50,549,700
Other assets	21,143,973		20,584,135
Total assets	614,232,263		527,343,078
Mortgage loan payable, repurchase agreement payable, revolving credit facility payable and obligations under participation agreements	(252,571,125)		(227,548,397)
Accounts payable, accrued expenses and other liabilities	(41,304,905)		(40,826,139)
Lease intangible liabilities	(11,127,360)		(11,424,809)
Total liabilities	(305,003,390)		(279,799,345)
Stockholder’s equity	$	309,228,873	$	247,543,733

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Revenues	$	12,064,629	$	13,332,694	$	24,142,200	$	26,070,628
Expenses	(10,562,322)		(13,486,179)		(21,750,371)		(22,301,238)
Net loss on extinguishment of obligations under participation agreements	—		—		(319,453)		—
Realized gains on marketable securities	1,076,213		—		1,085,107		—
Unrealized gains on marketable securities	67,522		—		67,522		—
Net income (loss)	$	2,646,042	$	(153,485)	$	3,225,005	$	3,769,390

Fair Value Measurements

        The Company adopted the provisions of ASC 820, Fair Value Measurement (“ASC 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 established a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment, the characteristics specific to the investment, and the state of the marketplace (including the existence and transparency of transactions between market participants). Investments with readily available, actively quoted prices or for which fair value can be measured from actively quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree

of judgment used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Investments measured and reported at fair value are classified and disclosed into one of the following categories based on the inputs as follows:

        Level 1 — Quoted prices (unadjusted) in active markets for identical assets and liabilities that the Company has the ability to access.

        Level 2 — Pricing inputs are other than quoted prices in active markets, including, but not limited to, quoted prices for similar assets and liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs.

        Level 3 — Significant unobservable inputs are based on the best information available in the circumstances, to the extent observable inputs are not available, including the Company’s own assumptions used in determining the fair value of investments. Fair value for these investments are determined using valuation methodologies that consider a range of factors, including but not limited to the price at which the investment was acquired, the nature of the investment, local market conditions, trading values on public exchanges for comparable securities, current and projected operating performance, and financing transactions subsequent to the acquisition of the investment. The inputs into the determination of fair value require significant management judgment.

  In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment.

Assets and Liabilities Reported at Fair Value

        The following table summarizes the Company’s equity investment at fair value on a recurring basis as of June 30, 2020 and December 31, 2019:

	June 30, 2020
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Investment:
Equity investment in Terra JV	$	—	$	—	$	238,509,869	$	238,509,869

	December 31, 2019
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Investment:
Equity investment in Terra Property Trust	$	—	$	—	$	247,263,245	$	247,263,245

        Changes in Level 3 investment for the six months ended June 30, 2020 and 2019 were as follows:

	Equity Investment in Terra JV		Equity Investment in Terra Property Trust
	Period from March 2, 2020 to June 30, 2020		Period from January 1, 2020 to March 1, 2020		Six Months Ended June 30, 2019
Beginning balance	$	—	$	247,263,245	$	263,092,586
Transfer of ownership interest in Terra Property Trust to Terra JV	244,006,890		(244,006,890)		—
Return of capital	(5,497,444)		(3,783,607)		(11,260,039)
Net change in unrealized appreciation on investment	423		527,252		3,198,259
Ending balance	$	238,509,869	$	—	$	255,030,806
Net change in unrealized appreciation on investment for the period relating to those Level 3 assets that were still held by the Company	$	423	$	527,252	$	3,198,259

        Transfers between levels, if any, are recognized at the beginning of the period in which transfers occur. For the six months ended June 30, 2020 and 2019, there were no transfers.

The Company estimated that its other financial assets and liabilities had fair values that approximated their carrying values at June 30, 2020 and December 31, 2019 due to their short-term nature.

Valuation Process for Fair Value Measurement

        Market quotations are not readily available for the Company’s investment in Terra Property Trust or Terra JV, which is included in Level 3 of the fair value hierarchy. The fair value of the Company’s sole investment takes into consideration the fair value of Terra Property Trust’s assets and liabilities which are valued utilizing a yield approach, i.e. a discounted cash flow methodology. In following this methodology, loans are evaluated individually, and management takes into account, in determining the risk-adjusted discount rate for each of Terra Property Trust’s loans, relevant factors, including available current market data on applicable yields of comparable debt/preferred equity instruments; market credit spreads and yield curves; the investment’s yield; covenants of the investment, including prepayment provisions; the portfolio company’s ability to make payments, its net operating income, debt-service coverage ratio; construction progress reports and construction budget analysis; the nature, quality, and realizable value of any collateral (and loan-to-value ratio); and the forces that influence the local markets in which the asset (the collateral) is purchased and sold, such as capitalization rates, occupancy rates, rental rates, replacement costs and the anticipated duration of each real estate-related loan.

The Manager designates a valuation committee to oversee the entire valuation process of Terra Property Trust’s Level 3 investments. The valuation committee is comprised of members of the Manager’s senior management, deal and portfolio management teams, who meet on a quarterly basis, or more frequently as needed, to review Terra Property Trust investments being valued as well as the inputs used in the proprietary valuation model. Valuations determined by the valuation committee are supported by pertinent data and, in addition to a proprietary valuation model, are based on market data, third-party valuation data and discount rates or other methods the valuation committee deems to be appropriate.

The following tables summarize the valuation techniques and significant unobservable inputs used by the Company to value the Level 3 investments as of June 30, 2020 and December 31, 2019. The tables are not intended to be all-inclusive, but instead identify the significant unobservable inputs relevant to the determination of fair values.

	Fair Value		Primary Valuation Technique	Unobservable Inputs	June 30, 2020
Asset Category					Minimum		Maximum		Weighted Average
Assets:
Equity investment in Terra JV	$	238,509,869	Discounted cash flow (1)	Discount rate (1)	2.51	%	19.05	%	16.82	%

	Fair Value		Primary Valuation Technique	Unobservable Inputs	December 31, 2019
Asset Category					Minimum		Maximum		Weighted Average
Assets:
Equity investment in Terra Property Trust	$	247,263,245	Discounted cash flow (1)	Discount rate (1)	4.11	%	14.95	%	12.36	%

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(1)Discounted cash flows and discount rates applied to Terra Property Trust’s assets and liabilities.

Risks and Uncertainties

        The Company’s investment in Terra Property Trust or Terra JV is highly illiquid and there is no assurance that the Company will achieve its investment objectives, including targeted returns. Terra Property Trust’s loans are highly illiquid. Due to the illiquidity of the loans, valuation of the loans may be difficult, as there generally will be no established markets for these loans. As the Company’s investment is carried at fair value with fair value changes recognized in the statements of operations, any changes in fair value would directly affect the Company’s members’ capital.

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Related Party Transactions

6 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

Related Party Transactions Disclosure [Text Block]

Note 4. Related Party Transactions

Operating Agreement

        The Company has an operating agreement, as amended, with Terra Fund Advisors. The operating agreement, as amended, is scheduled to terminate on December 31, 2023 unless the Company is dissolved earlier. Starting January 1, 2016, the Company conducts all of its real estate lending business through Terra Property Trust. As such, Terra Property Trust is responsible for management compensation paid and operating expenses reimbursed to its manager pursuant to a management agreement with the manager.

Dividend Income

        As discussed in Note 3, for the three months ended June 30, 2020 and 2019, the Company received approximately $3.4 million and $7.6 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $2.7 million and $7.6 million were returns of capital, respectively. For the six months ended June 30, 2020 and 2019, the Company received approximately $11.2 million and $15.2 million of distributions from Terra JV and/or Terra Property Trust as applicable, respectively, of which $9.3 million and $11.3 million were returns of capital, respectively.

TPT2 Merger

        On February 28, 2020, Terra Property Trust entered into certain Agreement and Plan of Merger (the “Merger Agreement”), by and among Terra Property Trust, Terra Property Trust 2, Inc. (“TPT2”) and Terra Fund 7, the sole stockholder of TPT2, pursuant to which TPT2 merged with and into Terra Property Trust, with Terra Property Trust continuing as the surviving corporation (the “TPT2 Merger”), effective March 1, 2020. In connection with the TPT2 Merger, each share of common stock, par value $0.01 per share, of TPT2 issued and outstanding immediately prior to the effective time of the TPT2 Merger was converted into the right to receive from Terra Property Trust a number of shares of common stock, par value $0.01 per share, of Terra Property Trust equal to an exchange ratio, which was 1.2031. The exchange ratio was based on the relative fair value of Terra Property Trust and TPT2 as of December 31, 2019 as adjusted to reflect changes in net working capital of each of Terra Property Trust and TPT2 during the period from January 1, 2020 through March 1, 2020, the effective time for the TPT2 Merger. For purposes of determining the respective fair values of Terra Property Trust and TPT2, the value of the loans (or participation interests therein) held by each of Terra Property Trust and TPT2 was the value of such loans (or participation interests) as set forth in the audited financial statements of Terra Property Trust as of and for the year ended December 31, 2019. As a result, Terra Fund 7 received 2,116,785.76 shares of common stock of Terra Property Trust as consideration in the TPT2 Merger and subsequently contributed these shares to Terra JV. The shares of Terra Property Trust common stock issued in connection with the TPT2 Merger were issued in a private placement in reliance on Section 4(a)(2) under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations promulgated thereunder

Issuance of Common Stock to TIF3 REIT

        In addition, on March 2, 2020, Terra Property Trust entered into two separate contribution agreements, one by and among Terra Property Trust, TIF3 REIT and Terra Income Fund International, and another by and among Terra Property Trust, TIF3 REIT and Terra Secured Income Fund 5 International, pursuant to which Terra Property Trust issued 2,457,684.59 shares of common stock of Terra Property Trust to TIF3 REIT in exchange for the settlement of $32.1 million of participation interests in loans also held by Terra Property Trust, $8.6 million in cash and other working capital (“Issuance of Common Stock to TIF3 REIT”).The shares of common stock were issued in a private placement in reliance on Section 4(a)(2) under the Securities Act and the rules and regulations promulgated thereunder. On April 29, 2020, Terra Property Trust repurchased, at a purchase price $17.02 per share, 212,691 shares of common stock that Terra Property Trust had previously sold to TIF3 REIT on September 30, 2019.

Terra JV, LLC

        Prior to the completion of the TPT2 Merger and the Issuance of Common Stock to TIF3 REIT transactions described above, the Company owned approximately 98.6% of the issued and outstanding shares of Terra Property Trust’s common stock indirectly through its wholly owned subsidiary, Terra JV, of which the Company was the sole managing member, and the remaining issued and outstanding shares of Terra Property Trust’s common stock were owned by TIF3 REIT.

        As described above, Terra Property Trust acquired TPT2 in the TPT2 Merger and, in connection with such transaction, Terra Fund 7 contributed the shares of Terra Property Trust’s common stock received as consideration in the TPT2 Merger to Terra JV and became a co-managing member of Terra JV pursuant to the amended and restated operating agreement of Terra JV, dated March 2, 2020 (the “JV Agreement”). The JV Agreement and related stockholders agreement between Terra JV and Terra Property Trust, dated March 2, 2020, provide for the joint approval of the Company and Terra Fund 7 with respect to certain major decisions that are taken by Terra JV and Terra Property Trust.

        On March 2, 2020, Terra Property Trust, the Company, Terra JV and Terra REIT Advisors also entered into the Amended and Restated Voting Agreement (the “Voting Agreement”), pursuant to which the Company assigned its rights and obligations under the Voting Agreement to Terra JV. Consistent with the original voting agreement dated February 8, 2018, for the period that Terra REIT Advisors remains the external manager of Terra Property Trust, Terra REIT Advisors will have the right to nominate two individuals to serve as directors of Terra Property Trust, until Terra JV no longer holds at least 10% of the outstanding shares of Terra Property Trust’s common stock, Terra JV will have the right to nominate one individual to serve as a director of Terra Property Trust.

        As of June 30, 2020, Terra JV owns approximately 87.4% of the issued and outstanding shares of Terra Property Trust common stock with the remainder held by TIF3 REIT, and the Company and Terra Fund 7 own an 87.6% and 12.4% interest, respectively, in Terra JV. As a result, as of June 30, 2020, the Company indirectly beneficially owned 76.5% of Terra Property Trust's outstanding common stock through Terra JV.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

Note 5. Commitments and Contingencies

The Company enters into contracts that contain a variety of indemnification provisions. The Company’s maximum exposure under these arrangements is unknown; however, the Company has not had prior claims or losses pursuant to these contracts. The Manager has reviewed the Company’s existing contracts and expects the risk of loss to the Company to be remote.

The Company is not currently subject to any material legal proceedings and, to the Company’s knowledge, no material legal proceedings are threatened against the Company. From time to time, the Company may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of the Company’s rights under contracts with its portfolio companies. While the outcome of any legal proceedings cannot be predicted with certainty, the Company does not expect that any such proceedings will have a material adverse effect upon its financial condition or results of operations.

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Members' Capital

6 Months Ended

Jun. 30, 2020

Limited Liability Company (LLC) Members' Equity [Abstract]

Members' Capital

Note 6. Members’ Capital

        As of both June 30, 2020 and December 31, 2019, the Company had 6,637.7 units outstanding. The net asset value per unit was $35,962 and $37,222 as of June 30, 2020 and December 31, 2019, respectively.

Capital Contributions

        As of January 31, 2015, the offering period ended, and the Company stopped accepting capital contributions. In connection with the Merger, the Company offered existing members of the Terra Funds the opportunity to invest in the Company through purchase of additional units (the “Rights Offering”). The Rights Offering was completed on May 17, 2016.

Capital Distributions

        At the discretion of the Manager, the Company may make distributions from net cash flow from operations, net disposition proceeds, or other cash available for distribution. Distributions are made to holders of Continuing Income Units (regular units of limited liability company interest in the Company) in proportion to their unit holdings until they receive a return of their initial Deemed Capital Contribution, as defined in the operating agreement, plus a preferred return ranging from 8.5% to 9.0% depending on the historical preferred return applicable to their Terra Fund units, after which time distributions are made 15% to

the Manager which the Company refers to as the carried interest distribution, and 85% to the holders of Continuing Income Units. The preferred return applicable to the Continuing Income Units sold in the offering concurrent with the Merger is 8.5%.

        For the three months ended June 30, 2020 and 2019, the Company made total distributions to non-manager members of $3.0 million and $7.5 million, respectively. For the six months ended June 30, 2020 and 2019, the Company made total distributions to non-manager members of $10.5 million and $14.9 million, respectively. For the three and six months ended June 30, 2020 and 2019, the Company did not make any carried interest distributions to the Manager.

Capital Redemptions

        At the discretion of the Manager, a reserve of 5% of cash from operations may be established in order to repurchase units from non-managing members. The Manager is under no obligation to redeem non-managing members’ units. As of June 30, 2020 and December 31, 2019, no such reserve was established. For the three and six months ended June 30, 2020 and 2019, the Company did not redeem any membership units.

Allocation of Income (Loss)

        Profits and losses are allocated to the members in proportion to the units held in a given calendar year.

Member Units

        Each membership interest through the original offering was offered for a price of $50,000 per unit. The membership interests in Terra Funds 1 through 4 were exchanged for units of the Company at a price of $43,410 per unit, which was the exchange value per unit of the Company on December 31, 2015, and the units in the Rights Offering were offered at a price of $47,000 per unit. For the six months ended June 30, 2020 and 2019, the Company did not issue or redeem any membership units.

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Financial Highlights

6 Months Ended

Jun. 30, 2020

Investment Company, Financial Highlights [Abstract]

Financial Highlights

Note 7. Financial Highlights

        The financial highlights represent the per unit operating performance, return and ratios for the non-managing members’ class, taken as a whole, for the six months ended June 30, 2020 and 2019. These financial highlights consist of the operating performance, the internal rate of return (“IRR”) since inception of the Company, and the expense and net investment income ratios which are annualized except for the on-recurring expenses.

        The IRR, net of all fees and carried interest (if any), is computed based on actual dates of the cash inflows (capital contributions), outflows (capital distributions), and the ending capital at the end of the respective period (residual value) of the non-managing members’ capital account.

        The following summarizes the Company’s financial highlights for the six months ended June 30, 2020 and 2019:

	Six Months Ended June 30,
	2020			2019
Per unit operating performance:
Net asset value per unit, beginning of period	$	37,222		$	39,630
Increase in members’ capital from operations (1):
Net investment income	242			549
Net change in unrealized appreciation on investment	80			481
Total increase in members’ capital from operations	322			1,030
Distributions to member (2):
Capital distributions	(1,582)			(2,249)
Net decrease in members’ capital resulting from distributions	(1,582)			(2,249)
Net asset value per unit, end of period	$	35,962		$	38,411
Ratios to average net assets:
Expenses	0.28		%	0.21		%
Net investment income	1.33		%	2.76		%
IRR, beginning of period	6.40		%	6.56		%
IRR, end of period	6.07		%	6.46		%

_______________

(1)The per unit data was derived by using the weighted average units outstanding during the applicable periods, which were 6,638 units and 6,639 units for the six months ended June 30, 2020 and 2019, respectively.

(2)The per unit data for distributions reflects the actual amount of distributions paid per unit during the periods.

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Subsequent Events

6 Months Ended

Jun. 30, 2020

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Note 8. Subsequent Events

Management has evaluated subsequent events through the date the financial statements were available to be issued. Management has determined that there are no material events that would require adjustment to, or disclosure in, the Company’s financial statements.

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

        The interim financial statements have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP”). The financial statements as of December 31, 2019 and for the three and six months ended June 30, 2019 and the period from January 1, 2020 to March 1, 2020 included all of the Company’s accounts and those of its consolidated subsidiaries. All intercompany balances and transactions had been eliminated. As discussed in Note 1, on March 2, 2020, the Company’s subsidiaries completed the Terra Fund Merger. As a result of the Terra Fund Merger, the Company no longer consolidates the subsidiaries. The financial statements as of June 30, 2020 and for the period from March 2, 2020 to June 30, 2020 and the three months ended June 30, 2020 includes all of the Company’s accounts only.

        The accompanying interim financial statements of the Company and related financial information have been prepared pursuant to the requirements for reporting on Form 10-Q and Articles 6 or 10 of Regulation S-X. The Company is an investment company, as defined under U.S. GAAP, and applies accounting and reporting guidance in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services - Investment Companies.

Use of Estimates

Use of Estimates

        The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. During the first half of 2020, there was a global outbreak of a novel coronavirus (“COVID-19”), which has spread to over 200 countries and territories, including the United States, and has spread to every state in the United States. The World Health Organization has designated COVID-19 as a pandemic, and numerous countries, including the United States, have declared national emergencies with respect to COVID-19. The global impact of the outbreak has been rapidly evolving, and as cases of COVID-19 have continued to be identified in additional countries, many countries have reacted by instituting quarantines and restrictions on travel, closing financial markets and/or restricting trading and operations of non-essential offices and retail centers. Such actions are creating disruption in global supply chains, and adversely impacting many industries. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19 on economic and market conditions. The Company believes the estimates and assumptions underlying its financial statements are reasonable and supportable based on the information available as of June 30, 2020, however uncertainty over the ultimate impact COVID-19 will have on the global economy generally, and the Company’s business in particular, makes any estimates and assumptions as of June 30, 2020 inherently less certain than they would be absent the current and potential impacts of COVID-19. Actual results may ultimately differ from those estimates.

Equity Investment

Equity Investment in Terra JV or Terra Property Trust        Equity investment in Terra JV or Terra Property Trust represents the Company’s equity interest in Terra JV or Terra Property Trust as applicable, which was initially recorded at cost. Subsequent to the asset contribution, the equity investment is reported, at each reporting date, at fair value on the statements of financial condition. Change in fair value is reported in net change in unrealized appreciation or depreciation on investment on the statements of operations.

Revenue Recognition

Revenue Recognition

        Dividend Income: Dividend income associated with the Company’s ownership of Terra JV or Terra Property Trust is recognized on the record date as declared by Terra JV or Terra Property Trust. Any excess of distributions over Terra JV or Terra Property Trust’s cumulative net income are recorded as return of capital.

        Other Operating Income: All other income is recognized when earned.

Cash and Cash Equivalents

Cash and Cash Equivalents The Company considers all highly liquid investments, with original maturities of ninety days or less when purchased, as cash equivalents. Cash and cash equivalents are exposed to concentrations of credit risk. The Company maintains all of its cash at financial institutions which, at times, may exceed the amount insured by the Federal Deposit Insurance Corporation.

Income Taxes

Income Taxes

        No provision for U.S. federal and state income taxes has been made in the accompanying financial statements, as individual members are responsible for their proportionate share of the Company’s taxable income. The Company, however, may be liable for New York City Unincorporated Business Tax (the “NYC UBT”) and similar taxes of various other municipalities. New York City imposes the NYC UBT at a statutory rate of 4% on net income generated from ordinary business activities carried on in New York City. For the three and six months ended June 30, 2020 and 2019, none of the Company’s income was subject to the NYC UBT.

        Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statements and tax basis assets and liabilities using enacted tax rates in effect for the year in which differences are expected to reverse. Such deferred tax assets and liabilities were not material.

        The Company did not have any uncertain tax positions that met the recognition or measurement criteria of ASC 740-10-25, Income Taxes, nor did the Company have any unrecognized tax benefits as of the periods presented herein. The Company recognizes interest and penalties, if any, related to unrecognized tax liabilities as income tax expense in its statements of operations. For the three and six months ended June 30, 2020 and 2019, the Company did not incur any interest or penalties. Although the Company files federal and state tax returns, its primary tax jurisdiction is federal. The Company’s 2015-2019 federal tax years remain subject to examination by the Internal Revenue Service.

Fair Value Measurement

The Company adopted the provisions of ASC 820, Fair Value Measurement (“ASC 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 established a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment, the characteristics specific to the investment, and the state of the marketplace (including the existence and transparency of transactions between market participants). Investments with readily available, actively quoted prices or for which fair value can be measured from actively quoted prices in an orderly market will generally have a higher degree of market price observability and a lesser degree

of judgment used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Investments measured and reported at fair value are classified and disclosed into one of the following categories based on the inputs as follows:

        Level 1 — Quoted prices (unadjusted) in active markets for identical assets and liabilities that the Company has the ability to access.

        Level 2 — Pricing inputs are other than quoted prices in active markets, including, but not limited to, quoted prices for similar assets and liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs.

        Level 3 — Significant unobservable inputs are based on the best information available in the circumstances, to the extent observable inputs are not available, including the Company’s own assumptions used in determining the fair value of investments. Fair value for these investments are determined using valuation methodologies that consider a range of factors, including but not limited to the price at which the investment was acquired, the nature of the investment, local market conditions, trading values on public exchanges for comparable securities, current and projected operating performance, and financing transactions subsequent to the acquisition of the investment. The inputs into the determination of fair value require significant management judgment.

  In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an investment’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment.

New Accounting Pronouncements

Recent Accounting Pronouncement

        In February 2016, the FASB issued Accounting Standards Update 2018-13, Fair Value Measurement (Topic 820): Disclosure framework — Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The objective of ASU 2018-13 is to improve the effectiveness of disclosures in the notes to financial statements by facilitating clear communication of information required by U.S. GAAP. The amendments in ASU 2018-13 added, removed and modified certain fair value measurement disclosure requirements. ASU 2018-13 is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date. The Company adopted ASU 2018-13 on January 1, 2020. The adoption of ASU 2018-13 did not have a material impact on its financial statements and disclosures.

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Investment and Fair Value (Tables) - Terra Property Trust

6 Months Ended

Jun. 30, 2020

Investments

Summary Investment Holdings

The following tables present a summary of the Company’s investment at June 30, 2020 and December 31, 2019:

	June 30, 2020
Investment	Cost		Fair Value		% of Members’ Capital
87.6% interest in Terra JV, LLC	$	238,509,445	$	238,509,869	99.9	%

	December 31, 2019
Investment	Cost		Fair Value		% of Members’ Capital
14,912,990 common shares of Terra Property Trust, Inc.	$	243,924,852	$	247,263,245	100.1	%

Summary of financial information

The following tables present the summarized financial information of Terra Property Trust:

	June 30, 2020		December 31, 2019
Carrying value of loans held for investment	$	414,448,282	$	378,612,768
Real estate owned, net	75,694,708		77,596,475
Cash, cash equivalent and restricted cash	102,945,300		50,549,700
Other assets	21,143,973		20,584,135
Total assets	614,232,263		527,343,078
Mortgage loan payable, repurchase agreement payable, revolving credit facility payable and obligations under participation agreements	(252,571,125)		(227,548,397)
Accounts payable, accrued expenses and other liabilities	(41,304,905)		(40,826,139)
Lease intangible liabilities	(11,127,360)		(11,424,809)
Total liabilities	(305,003,390)		(279,799,345)
Stockholder’s equity	$	309,228,873	$	247,543,733

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Revenues	$	12,064,629	$	13,332,694	$	24,142,200	$	26,070,628
Expenses	(10,562,322)		(13,486,179)		(21,750,371)		(22,301,238)
Net loss on extinguishment of obligations under participation agreements	—		—		(319,453)		—
Realized gains on marketable securities	1,076,213		—		1,085,107		—
Unrealized gains on marketable securities	67,522		—		67,522		—
Net income (loss)	$	2,646,042	$	(153,485)	$	3,225,005	$	3,769,390

Summary of Company's equity investment at fair value on a recurring basis

The following table summarizes the Company’s equity investment at fair value on a recurring basis as of June 30, 2020 and December 31, 2019:

	June 30, 2020
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Investment:
Equity investment in Terra JV	$	—	$	—	$	238,509,869	$	238,509,869

	December 31, 2019
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Investment:
Equity investment in Terra Property Trust	$	—	$	—	$	247,263,245	$	247,263,245

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

Changes in Level 3 investment for the six months ended June 30, 2020 and 2019 were as follows:

	Equity Investment in Terra JV		Equity Investment in Terra Property Trust
	Period from March 2, 2020 to June 30, 2020		Period from January 1, 2020 to March 1, 2020		Six Months Ended June 30, 2019
Beginning balance	$	—	$	247,263,245	$	263,092,586
Transfer of ownership interest in Terra Property Trust to Terra JV	244,006,890		(244,006,890)		—
Return of capital	(5,497,444)		(3,783,607)		(11,260,039)
Net change in unrealized appreciation on investment	423		527,252		3,198,259
Ending balance	$	238,509,869	$	—	$	255,030,806
Net change in unrealized appreciation on investment for the period relating to those Level 3 assets that were still held by the Company	$	423	$	527,252	$	3,198,259

Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques

The following tables summarize the valuation techniques and significant unobservable inputs used by the Company to value the Level 3 investments as of June 30, 2020 and December 31, 2019. The tables are not intended to be all-inclusive, but instead identify the significant unobservable inputs relevant to the determination of fair values.

	Fair Value		Primary Valuation Technique	Unobservable Inputs	June 30, 2020
Asset Category					Minimum		Maximum		Weighted Average
Assets:
Equity investment in Terra JV	$	238,509,869	Discounted cash flow (1)	Discount rate (1)	2.51	%	19.05	%	16.82	%

	Fair Value		Primary Valuation Technique	Unobservable Inputs	December 31, 2019
Asset Category					Minimum		Maximum		Weighted Average
Assets:
Equity investment in Terra Property Trust	$	247,263,245	Discounted cash flow (1)	Discount rate (1)	4.11	%	14.95	%	12.36	%

_______________

(1)Discounted cash flows and discount rates applied to Terra Property Trust’s assets and liabilities.

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Financial Highlights (Tables)

6 Months Ended

Jun. 30, 2020

Investment Company, Financial Highlights [Abstract]

Financial Highlights

The following summarizes the Company’s financial highlights for the six months ended June 30, 2020 and 2019:

	Six Months Ended June 30,
	2020			2019
Per unit operating performance:
Net asset value per unit, beginning of period	$	37,222		$	39,630
Increase in members’ capital from operations (1):
Net investment income	242			549
Net change in unrealized appreciation on investment	80			481
Total increase in members’ capital from operations	322			1,030
Distributions to member (2):
Capital distributions	(1,582)			(2,249)
Net decrease in members’ capital resulting from distributions	(1,582)			(2,249)
Net asset value per unit, end of period	$	35,962		$	38,411
Ratios to average net assets:
Expenses	0.28		%	0.21		%
Net investment income	1.33		%	2.76		%
IRR, beginning of period	6.40		%	6.56		%
IRR, end of period	6.07		%	6.46		%

_______________

(1)The per unit data was derived by using the weighted average units outstanding during the applicable periods, which were 6,638 units and 6,639 units for the six months ended June 30, 2020 and 2019, respectively.

(2)The per unit data for distributions reflects the actual amount of distributions paid per unit during the periods.

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Business (Details)	6 Months Ended
	Jun. 30, 2020 USD ($) Number_of_Funds	Mar. 02, 2020 USD ($) shares
Subsidiary of Limited Liability Company or Limited Partnership
Operations Commenced Date	Aug. 08, 2013
Formation State	Delaware
Formation Date	Apr. 24, 2013
LLC Exit Date	Dec. 31, 2023
Terra JV | Terra Fund Five
Subsidiary of Limited Liability Company or Limited Partnership
Equity Method Investment, Ownership Percentage	87.60%
Terra JV | Terra fund Seven
Subsidiary of Limited Liability Company or Limited Partnership
Equity Method Investment, Ownership Percentage	12.40%
Minimum
Subsidiary of Limited Liability Company or Limited Partnership
Investment Owned, Balance, Principal Amount	$ 10,000,000
Maximum
Subsidiary of Limited Liability Company or Limited Partnership
Investment Owned, Balance, Principal Amount	$ 50,000,000
Terra Property Trust
Subsidiary of Limited Liability Company or Limited Partnership
Common Stock, Shares, Issued | shares		4,574,470.35
Common Stock, Value, Issued		$ 49,800,000
Cash		$ 25,500,000
Number Of Investment Funds | Number_of_Funds	5
Percent Of Common Stock Indrect Owned	76.50%
Terra Property Trust | Terra JV
Subsidiary of Limited Liability Company or Limited Partnership
Equity Method Investment, Ownership Percentage	87.40%
Terra Property Trust | Controlled
Subsidiary of Limited Liability Company or Limited Partnership
Percent Of Common Stock Indrect Owned	76.50%

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Summary of Significant Accounting Policies (Details)	6 Months Ended
	Jun. 30, 2020
Accounting Policies [Abstract]
UBT at statutory rate	4.00%

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Investment and Fair Value (Narratives) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Mar. 02, 2020	Dec. 31, 2019
Fair Value, Separate Account Investment [Line Items]
Return of capital on investment	$ 2,700,000	$ 7,600,000	$ 9,281,051	$ 11,260,039
Proceeds from Equity Method Investment, Distribution	3,400,000	$ 7,600,000	$ 11,200,000	$ 15,200,000
Terra JV | Terra fund Seven
Fair Value, Separate Account Investment [Line Items]
Equity Method Investment, Ownership Percentage			12.40%
Terra JV | Terra Fund Five
Fair Value, Separate Account Investment [Line Items]
Equity Method Investment, Ownership Percentage			87.60%
Terra Property Trust
Fair Value, Separate Account Investment [Line Items]
Below Market Lease, Net	$ 11,127,360		$ 11,127,360			$ 11,424,809
Common Stock, Shares, Issued					4,574,470.35
Common Stock, Value, Issued					$ 49,800,000
Cash					$ 25,500,000
Percent of Common Stock Direct Owned						98.60%
Percent Of Common Stock Indrect Owned	76.50%		76.50%
Terra Property Trust | Terra JV
Fair Value, Separate Account Investment [Line Items]
Equity Method Investment, Ownership Percentage			87.40%

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Investment and Fair Value (Summary of the Investments) (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Terra Property Trust
Investments
Amortized Cost	$ 0	$ 243,924,852
Fair Value	0	$ 247,263,245
% of Members Capital		100.10%
Terra JV
Investments
Amortized Cost	238,509,445	$ 0
Fair Value	$ 238,509,869	$ 0
% of Members Capital	99.90%

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Investment and Fair Value (Summary of Financial Information of Terra Property Trust) (Details) - Terra Property Trust - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Fair Value, Separate Account Investment [Line Items]
Carrying value of investments	$ 414,448,282	$ 378,612,768
Real estate owned, net	75,694,708	77,596,475
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	102,945,300	50,549,700
Other assets	21,143,973	20,584,135
Total assets	614,232,263	527,343,078
Mortgage loan payable and obligations under participation agreements	(252,571,125)	(227,548,397)
Accounts payable, accrued expenses and other liabilities	(41,304,905)	(40,826,139)
Lease intangible liabilities	(11,127,360)	(11,424,809)
Total liabilities	(305,003,390)	(279,799,345)
Stockholder’s equity	$ 309,228,873	$ 247,543,733

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Investment and Fair Value (Summary of Financial Information 2) (Details) - Terra Property Trust - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Investments
Revenues	$ 12,064,629	$ 13,332,694	$ 24,142,200	$ 26,070,628
Expenses	(10,562,322)	(13,486,179)	(21,750,371)	(22,301,238)
Net loss on extinguishment of obligations under participation agreements	0	0	(319,453)	0
Unrealized gains on marketable securities	1,076,213	0	1,085,107	0
Unrealized gains on marketable securities	67,522	0	67,522	0
Net income (loss)	$ 2,646,042	$ (153,485)	$ 3,225,005	$ 3,769,390

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Investment and Fair Value (Equity Investment at Fair Value on a recurring basis) (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Terra Property Trust
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 0	$ 247,263,245
Terra Property Trust | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value		0
Terra Property Trust | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value		0
Terra Property Trust | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value		247,263,245
Terra JV
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	238,509,869	$ 0
Terra JV | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0
Terra JV | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	0
Terra JV | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 238,509,869

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Investments and Fair Value (Changes in Level 3) (Details) - USD ($)	2 Months Ended	3 Months Ended		4 Months Ended	6 Months Ended
	Mar. 01, 2020	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2020	Jun. 30, 2019
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Transfer of ownership interest in Terra Property Trust to Terra JV					$ 244,006,890	$ 0
Net change in unrealized appreciation on investment		$ 2,813,973	$ 1,609,008		527,675	3,198,259
Terra JV | Level 3
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance				$ 0
Transfer of ownership interest in Terra Property Trust to Terra JV				244,006,890
Return of capital				(5,497,444)
Net change in unrealized appreciation on investment				423
Ending balance	$ 0	$ 238,509,869		238,509,869	238,509,869
Net change in unrealized appreciation on investment for the period relating to those Level 3 assets that were still held by the Company				423
Terra Property Trust | Level 3
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	247,263,245			$ 0	$ 247,263,245	263,092,586
Transfer of ownership interest in Terra Property Trust to Terra JV	(244,006,890)					0
Return of capital	(3,783,607)					(11,260,039)
Net change in unrealized appreciation on investment	527,252					3,198,259
Ending balance	0		$ 255,030,806			255,030,806
Net change in unrealized appreciation on investment for the period relating to those Level 3 assets that were still held by the Company	$ 527,252					$ 3,198,259

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Investment and Fair Value (Valuation techniques and significant unobservable inputs) (Details)	Jun. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Terra Property Trust
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	$ 0	$ 247,263,245
Terra JV
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	238,509,869	0
Level 3 | Terra Property Trust
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value		247,263,245
Level 3 | Terra Property Trust | Discounted Cash Flow
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value		$ 247,263,245
Level 3 | Terra Property Trust | Discount Rate | Discounted Cash Flow | Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Discount rate		0.0411
Level 3 | Terra Property Trust | Discount Rate | Discounted Cash Flow | Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Discount rate		0.1495
Level 3 | Terra Property Trust | Discount Rate | Discounted Cash Flow | Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Discount rate		0.1236
Level 3 | Terra JV
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	238,509,869
Level 3 | Terra JV | Discounted Cash Flow
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair Value	$ 238,509,869
Level 3 | Terra JV | Discount Rate | Discounted Cash Flow | Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Discount rate	0.0251
Level 3 | Terra JV | Discount Rate | Discounted Cash Flow | Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Discount rate	0.1905
Level 3 | Terra JV | Discount Rate | Discounted Cash Flow | Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Discount rate	0.1682

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Related Party Transactions - Operating agreement and dividend income (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Investments
LLC Exit Date			Dec. 31, 2023
Proceeds from Equity Method Investment, Distribution	$ 3,400,000	$ 7,600,000	$ 11,200,000	$ 15,200,000
Return of capital on investment	$ 2,700,000	$ 7,600,000	$ 9,281,051	$ 11,260,039
Terra Property Trust
Investments
Percent of Common Stock Direct Owned					98.60%

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Related Party Transactions - TPT2 Merger (Details) - $ / shares	Feb. 28, 2020	Dec. 31, 2019
Terra Property Trust
Investments
Common Stock, Par or Stated Value Per Share	$ 0.01
Terra fund Seven
Investments
Common Stock, Par or Stated Value Per Share	$ 0.01
Terra fund Seven | TPT2 Merger | Terra Property Trust
Investments
Business Acquisition, Share Price		$ 1.2031
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares	2,116,785.76

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Related Party Transactions - Issuance of Common Stocks to TIF3 REIT (Details) - USD ($)	Apr. 29, 2020	Mar. 02, 2020
Terra International Fund 3
Investments
Share Price	$ 17.02
Stock Repurchased During Period, Shares	212,691
Terra Property Trust
Investments
Common Stock, Value, Issued		$ 49,800,000
Cash		25,500,000
Terra Property Trust | Terra International Fund 3
Investments
Common Stock, Value, Issued		$ 32,100,000
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares		2,457,684.59
Cash Acquired in Excess of Payments to Acquire Business		$ 8,600,000

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Related Party Transactions - Terra JV, LLC (Details)	6 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Terra JV | Terra fund Seven
Investments
Equity Method Investment, Ownership Percentage	12.40%
Terra JV | Terra Fund Five
Investments
Equity Method Investment, Ownership Percentage	87.60%
Terra Property Trust
Investments
Percent of Common Stock Direct Owned		98.60%
Percent Of Common Stock Indrect Owned	76.50%
Terra Property Trust | Controlled
Investments
Percent of Common Stock Direct Owned		98.60%
Percent Of Common Stock Indrect Owned	76.50%
Terra Property Trust | Terra JV
Investments
Equity Method Investment, Ownership Percentage	87.40%

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Members' Capital - Narratives (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019	Dec. 31, 2018
Members Capital
Common Unit, Outstanding	6,637.7		6,637.7		6,637.7
Net asset value per unit	$ 35,962	$ 38,411	$ 35,962	$ 38,411	$ 37,222	$ 39,630
Capital distributions	$ 3,030,711	$ 7,468,095	$ 10,497,982	$ 14,936,189
Non-managing
Members Capital
Capital distributions	$ 3,030,711	$ 7,468,095	$ 10,497,982	$ 14,936,189
Continuing Income Units Holder
Members Capital
Percent of distribution made to members depends on the historical preferred return applicale to Terra Fund units			8.50%
Distribution Percent			85.00%
Shares Issued, Price Per Share	$ 43,410		$ 43,410
Continuing Income Units Holder | Minimum
Members Capital
Percent of distribution made to members depends on the historical preferred return applicale to Terra Fund units			8.50%
Continuing Income Units Holder | Maximum
Members Capital
Percent of distribution made to members depends on the historical preferred return applicale to Terra Fund units			9.00%
Manager
Members Capital
Distribution Percent			15.00%
Non-managing
Members Capital
Percent Of Cash Repurchase Capital Units	5.00%		5.00%
Non-managing | Continuing Income Units Holder
Members Capital
Distribution Made to Limited Partner, Unit Distribution			0	0
Managing | Termination Units Holder
Members Capital
Member units redemption			0	0
Rights Offering
Members Capital
Shares Issued, Price Per Share	$ 47,000		$ 47,000
Initial Offering
Members Capital
Shares Issued, Price Per Share	$ 50,000		$ 50,000

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Financial Highlights (Details) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Investment Company, Financial Highlights [Roll Forward]
Net asset value per unit			$ 37,222	$ 39,630
Increase in members’ capital from operations (1):
Net investment income	$ 78	$ (16)	242	549
Net change in unrealized appreciation on investment			80	481
Investment Company, Investment Income (Loss) from Operations, Per Share	502	227	322	1,030
Distributions to member (2):
Capital distributions			(1,582)	(2,249)
Net decrease in members’ capital resulting from distributions			(1,582)	(2,249)
Capital share transactions:
Net asset value per unit	$ 35,962	$ 38,411	$ 35,962	$ 38,411
Ratios to average net assets:
Expenses			0.28%	0.21%
Net investment income			1.33%	2.76%
Investment company internal rate of return			6.40%	6.56%
Investment company internal rate of return	6.07%	6.46%	6.07%	6.46%
Non-managing Member Class
Ratios to average net assets:
Weighted Average Membership Units Outstanding			6,638	6,639