Special Semiannual Financial Report under Regulation A Form 1 SA

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 1-SA

SEMIANNUAL REPORT

Pursuant to Regulation A of the Securities Act of 1933

For the semiannual period ended June 30, 2024

Roots Real Estate Investment Community I, LLC

(Exact name of issuer as specified in its charter)

Georgia		86-2608144
(State or other jurisdiction of organization)		(IRS Employer Identification No.)

1344 La France Street NE, Atlanta, GA		30307
(Address of principal executive offices)		(ZIP Code)

(404)-732-5910

(Issuer's telephone number, including area code)

Units

(Title of each class of securities issued pursuant to Regulation A)

TABLE OF CONTENTS

	Page
Item 1.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2
Item 2.	Other Information	4
Item 3.	Financial Statements	F-1
	PART III
Item 4.	Exhibits	5
	SIGNATURES	6

Item 1. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements and related notes appearing at the end of this Semiannual Report on Form 1-SA (the "Semiannual Report"). This discussion and analysis contain forward-looking statements reflecting our current expectations that involve risks and uncertainties. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, including those discussed in the section entitled "Risk Factors" as disclosed in our Offering Circular, as amended or supplemented from time to time, which may be accessed here and may be updated from time to time by our future filings under Regulation A. The accompanying consolidated balance sheets and the related consolidated statements of operations, members' equity and cash flows as of June 30, 2024 and for the six months ended June 30, 2024 and June 30, 2023 are unaudited and have not been reviewed by external auditors.

Overview

Roots Real Estate Investment Community I, LLC (the "Company", "we", "our", or "us"), was formed on December 8, 2020 as a Georgia limited liability company and has elected to be taxed as a real estate investment trust ("REIT") for U.S. federal income tax purposes. The Company was formed to originate, invest in and manage a diversified portfolio primarily consisting of investments in single family and multifamily residential real estate properties and development projects. Initially, the Company has targeted real estate in the Atlanta-Sandy Springs-Alpharetta Metropolitan Statistical Area (the "Atlanta MSA") in the state of Georgia that has value-add potential. However, the Manager (defined below) is not limited to searching only in the Atlanta MSA, and the Company may also invest in other major MSAs across the United States. Substantially all the Company's business is managed by Roots REIT Management, LLC, a Georgia limited liability company (the "Manager") which is a wholly owned subsidiary of the sponsor, Seed InvestCo, LLC, a Georgia limited liability company (the "Sponsor").

We are offering and will continue to offer up to $75,000,000 of our units of membership interest ("Units" or "Member Units") pursuant to Regulation A as promulgated under the Securities Act of 1933, as amended, as discussed in our Offering Circular dated March 27, 2024, as supplemented, and as the same may be amended and/or supplemented from time to time (the "Offering Circular"). As of June 30, 2024, we had raised total gross offering proceeds of $35,291,816 (including $6,527,328 in a private placement prior to the offering circular dated July 12, 2022, being declared "qualified" of which $182,995 was from our Sponsor). As of September 19, 2024, the Company has raised a total of $41,386,505 in capital, of which $182,995 is from our Sponsor.

Our Investments

On March 31, 2024, the Company acquired 26 properties for an aggregate purchase price of $6,096,000.

On June 30, 2024, the Company acquired 21 properties for an aggregate purchase price of $5,611,000

Liquidity and Capital Resources

Proceeds from Units sold in the Offering have been, and will continue to be, primarily used for property acquisitions and capital expenditures.

We employ leverage to enhance total returns to our Members through a combination of senior financing and other financing transactions. We seek to secure conservatively structured leverage that is long term and non-recourse to the extent obtainable on a cost-effective basis.

The success of our business is significantly related to general economic conditions and, accordingly, our business could be harmed by an economic slowdown and downturn in real estate asset values, property sales and rental activities including interest rate risk, credit risk, market risk and inflation risk. Interest rate risk is the result of movements in the underlying variable component of the mortgage financing rates. Credit risk is the risk of default on the Company's real estate assets that results from an underlying resident's inability or unwillingness to make contractually required payments. Market risk reflects changes in the valuation of real estate assets held by the Company. Inflation risk is the risk that rising prices could increase the Company's operating expenses and impact residents.

These economic conditions could result in a general decline in acquisition, and rental activity, as well as a general decline in the value of real estate and in rents. In addition, these conditions could lead to a decline in property sales prices as well as a decline in funds invested in existing real estate assets. During an economic downturn, it may also take longer for us to dispose of real estate investments, or the selling prices may be lower than originally anticipated. As a result, the carrying value of our real estate investments may become impaired and we could record losses with respect to such impairment or we could experience reduced profitability. Further, our exposure to adverse general economic conditions is heightened by our use of leverage.

All of the conditions described above could materially and adversely impact our business performance and profitability, which could result in our failure to make distributions to our investors and decrease the value of an investment in us. In addition, in an extreme deterioration of economic conditions, we could have insufficient liquidity to meet our debt service obligations when they come due in future years. If we fail to meet our payment or other obligations under our loan agreements, the lenders under such agreements will be entitled to proceed against the collateral securing such debts.

Distributions

On March 31, 2024, the Manager declared a quarterly cash distribution of $1.50 per Unit for Members of record as of the close of business on February 28, 2024. On June 30, 2024, the Manager declared a quarterly cash distribution of $1.50 per Unit for Members of record as of the close of business on May 31, 2024. We expect that distributions declared by our Manager will be made on a quarterly basis, or less frequently as determined by our Manager. Any future distributions by the Company will be at the discretion of our Manager, and will be based on, among other factors, our present and reasonably projected future cash flow.

Redemption Plan

We have adopted a redemption plan whereby, on a quarterly basis, a Member may obtain liquidity as described in detail in our Offering Circular, which may be accessed here. Our Manager may, in its sole discretion, amend, suspend, or terminate the redemption plan at any time without notice for any reason, including to protect our operations and our non-redeemed Members, to prevent an undue burden on our liquidity, to preserve our status as a REIT, following any material decrease in our NAV, or for any other reason.

Sources of Operating Revenues and Cash Flows

Refer to our Consolidated Statements of Cash Flows in our consolidated financial statements.

We expect to primarily generate operating revenues and cash flows from the operations of our real estate investments. See Note 2, Summary of Significant Accounting Policies, in our consolidated financial statements for further detail.

Cash Flows from Operating Activities

For the six months ended June 30, 2024 and 2023, net cash provided by operating activities was $975,690 and $294,027 respectively. For the six months ended June 30, 2024 and 2023, net cash flow from operating activities increased primarily due to increases in depreciation, due from related party, net, accounts payable and accrued expenses and deposits from residents.

Cash Flows from Investing Activities

For the six months ended June 30, 2024 and 2023, net cash used in investing activities was $11,131,217 and $7,009,977 respectively. For the six months ended June 30, 2024 and 2023, net cash used in investing activities increased due to the acquisition of forty-seven properties purchased during the period through additions to note receivable - related party.

Cash Flows from Financing Activities

For the six months ended June 30, 2024 and 2023, net cash provided by financing activities was $9,891,505, and $7,333,600, respectively. For the six months ended June 30, 2024 and 2023, net cash provided by financing activities increased due to proceeds from mortgage loans payable and proceeds from issuance of member units, offset by payments on mortgage loans payable.

Results of Operations

Refer to our Consolidated Statements of Operations in our consolidated financial statements.

For the six months ended June 30, 2024, we had net income attributable to Roots Real Estate Investment Community I, LLC in the amount of $6,270. This was driven by rental income from acquired properties and interest income from a related party offset by operating expenses, depreciation and interest expense.

Based on a comparison of the six months ended June 30, 2024 versus 2023, total revenues increased by $682,089 and operating expenses increased by $491,339. Nonoperating expenses increased by $373,573, which was primarily attributable to an increase in depreciation and interest expense partially offset by interest income related party.

We expect that rental income, operating and maintenance, property management fees, real estate taxes and insurance, general and administration, depreciation and interest expense will increase as we continue to acquire additional properties.

Outlook and Recent Trends

During the six months ended June 30, 2024, financial markets and interest rates fluctuated with the expectation of rate cuts before year end. The residential real estate market began to pick up and we anticipate this may continue as rates come down, but this will be offset as median home prices have peaked in the short term. Management believes that our unique, disciplined acquisition process will allow us to continue to access properties in our market at below market pricing and allow us to continue to execute on our value-add strategy of building a real estate investment opportunity that delivers to our investors and our Residents.

Critical Accounting Policies

See Note 2, Summary of Significant Accounting Policies, in our consolidated financial statements for further detail.

Off-Balance Sheet Arrangements

As of June 30, 2024 and December 31, 2023, we had no off-balance sheet arrangements.

Related Party Arrangements

For further information regarding Related Party Arrangements, please see Note 5 in the accompanying consolidated financial statements below.

Recent Developments

Between July 1, 2024 and September 19, 2024, the Company issued approximately 3,917 Units at a Unit price of $131.00 and approximately 47,653 Units at a Unit price of $133.00 respectively, for $6,851,048 in offering proceeds. As of September 19, 2024, the aggregate Units outstanding were approximately 339,530 Units for total offering proceeds of $41,386,505 (including approximately 64,234 Units totaling $6,526,828 received in a private placement prior to the initial offering being declared effective).

Item 2. Other Information

None.

Item 3. Financial Statements

CONDENSED FINANCIAL STATEMENTS

	Page
Consolidated Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023 (Audited)	F-2
Consolidated Statements of Operations (Unaudited) for the Six Months Ended June 30, 2024 and 2023	F-3
Consolidated Statements of Members' Equity (Unaudited) for the Six Months Ended June 30, 2024 and 2023	F-4
Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2024 and 2023	F-5
Notes to the Consolidated Financial Statements (Unaudited) June 30, 2024	F-6

ROOTS REAL ESTATE INVESTMENT COMMUNITY I, LLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

		(Unaudited)			(Audited)
		June 30, 2024			December 31, 2023
Assets:
Real estate:
Land		$	9,952,248			$	7,401,919
Building and improvements			26,333,681				17,995,601
Total real estate			36,285,929				25,397,520
Less: accumulated depreciation			(815,617	)			(454,616	)
Real estate, net			35,470,312				24,942,904
Cash and cash equivalents			421,265				780,323
Restricted cash			149,629				54,593
Resident receivables			5,580				52,882
Due from related party, net			155,405				401,538
Note receivable - related party			6,906,015				7,465,015
Prepaid expenses and other assets			223,169				121,503
Total assets		$	43,331,375			$	33,818,758
Liabilities:
Mortgage loans payable, net of unamortized deferred financing costs of $297,166 and $140,226 as of June 30, 2024 and December 31, 2023, respectively		$	12,451,651			$	13,485,954
Accounts payable and accrued expenses			340,129				61,550
Distributions payable			427,083				295,531
Deposits			169,187				86,298
Deferred income			27,421				14,215
Total liabilities			13,415,471				13,943,548
Commitments and contingencies (see note 6)
Members' equity:
Members' equity (294,058 and 203,042 member units issued and outstanding as of June 30, 2024 and December 31, 2023, respectively)			35,291,816				23,428,523
Distributions in excess of cumulative net income			(5,375,912	)			(3,553,313	)
Total members' equity			29,915,904				19,875,210
Total liabilities and members' equity		$	43,331,375			$	33,818,758

See notes to consolidated financial statements.

ROOTS REAL ESTATE INVESTMENT COMMUNITY I, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

		For the Six Months Ended June 30,
		2024			2023
Revenues:
Rental income		$	1,313,048			$	635,815
Other income			16,646			$	11,790
Total revenues			1,329,694				647,605
Expenses:
Operating and maintenance			300,175				128,695
Property management fees - related party			94,084				65,233
Property management fees			56,737				-
Real estate taxes and insurance			229,359				41,190
General and administrative			155,519				109,417
Total operating expenses			835,874				344,535
Net operating income			493,820				303,070
Nonoperating income (expenses):
Interest income - related party			319,337				153,427
Gain on sale of real estate			-				91,627
Depreciation expense			(361,001	)			(130,582	)
Interest expense			(445,886	)			(228,449	)
Total nonoperating expense, net			(487,550	)			(113,977	)
Net income		$	6,270			$	189,093

See notes to consolidated financial statements.

ROOTS REAL ESTATE INVESTMENT COMMUNITY I, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF MEMBERS' EQUITY (UNAUDITED)

For the Six Months Ended June 30, 2024

		Member Units			Members' Equity			Members' Commitments			Distributions in Excess of Cumulative Net Income			Total Members' Equity
Balance at January 1, 2024			203,042			$	23,428,523			$	-			$	(3,553,313	)		$	19,875,210
Proceeds from issuance of member units			96,785				12,769,236				-				-				12,769,236
Redemptions of member units			(5,769	)			(905,943	)			-				-				(905,943	)
Capital reductions			-				-				-				(1,049,808	)			(1,049,808	)
Distributions			-				-				-				(779,061	)			(779,061	)
Net income			-				-				-				6,270				6,270
Balance at June 30, 2024			294,058			$	35,291,816			$	-			$	(5,375,912	)		$	29,915,904

For the Six Months Ended June 30, 2023

		Member Units			Members' Equity			Members' Commitments			Distributions in Excess of Cumulative Net Income			Total Members' Equity
Balance at January 1, 2023			82,169			$	8,546,232			$	-			$	(993,008	)		$	7,553,224
Proceeds from issuance of member units			41,371				5,229,551				-				-				5,229,551
Members' commitments			2,745				330,894				(330,894	)			-				-
Redemptions of member units			(818	)			(85,734	)			-				-				(85,734	)
Capital reductions			-				-				-				(1,094,533	)			(1,094,533	)
Distributions			-				-				-				(377,077	)			(377,077	)
Net income			-				-				-				189,093				189,093
Balance at June 30, 2023			125,467			$	14,020,943			$	(330,894	)		$	(2,275,525	)		$	11,414,524

See notes to consolidated financial statements

ROOTS REAL ESTATE INVESTMENT COMMUNITY I, LLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

		For the Six Months Ended June 30,
		2024			2023
Cash flows from operating activities:
Net income		$	6,270			$	189,093
Gain on sale of real estate			-				(91,627	)
Depreciation expense			361,001				130,582
Amortization of deferred financing costs			16,811				38,387
Changes in assets and liabilities:
Resident receivables			47,302				-
Due from related party, net			246,133				21,716
Prepaid expenses and other assets			(101,666	)			(44,905	)
Accounts payable and accrued expenses			278,579				(4,210	)
Deposits			108,054				52,715
Deferred income			13,206				2,276
Net cash provided by operating activities			975,690				294,027
Cash flows from investing activities:
Proceds from sale of real estate			-				320,868
Additions to real estate			(231,217	)			(187,330	)
Additions to note receivable - related party			(10,900,000	)			(7,143,515	)
Net cash used in investing activities			(11,131,217	)			(7,009,977	)
Cash flows from financing activities:
Proceeds from mortgage loans payable			4,167,400				2,706,150
Payments on mortgage loans payable			(5,374,300	)			(132,000	)
Payment of financing costs			(173,751	)			(36,430	)
Proceeds from issuance of member units			12,229,957				4,905,666
Redemptions of member units			(905,943	)			(85,734	)
Distributions			(51,858	)			(24,052	)
Net cash provided by financing activities			9,891,505				7,333,600
Net increase (decrease) in cash, cash equivalents and restricted cash			(264,022	)			617,650
Cash, cash equivalents and restricted cash, beginning of period		$	834,916			$	467,220
Cash, cash equivalents and restricted cash, end of period		$	570,894			$	1,084,870
Supplemental cash flow information:
Cash paid for interest		$	429,074			$	190,062
Supplemental disclosure of noncash operating, investing and financing activities:
Acquisitions of real estate		$	(10,657,192	)		$	(5,334,698	)
Reductions of note receivable - related party		$	11,459,000			$	4,130,816
Assumption of deferred financing costs		$	-			$	(49,835	)
Assumption of mortgage loans payable		$	329,537			$	2,348,250
Deposits used for issuance of member units		$	(25,165	)		$	(79,215	)
Distributions payable used for issuance of member units		$	(183,410	)		$	(108,656	)
Increase in distributions payable		$	427,803			$	229,806
Decrease in other liabilities used for issuance of member units		$	-			$	(1,240	)
Issuance of member units from distributions reinvested		$	539,279			$	667,276
Members' commitments		$	-			$	(330,894	)
Increase in capital reductions		$	(1,828,869	)		$	(1,471,610	)

See notes to consolidated financial statements

Roots Real Estate Investment Community I, LLC and Subsidiaries

Notes to the Consolidated Financial Statements (Unaudited)

June 30, 2024

1. Formation and Organization

Roots Real Estate Investment Community I, LLC (the "Company") was formed on December 8, 2020, as a Georgia Limited Liability Company and has elected to be taxed as a real estate investment trust ("REIT") for U.S. federal income tax purposes. The Company's purpose is to create a real estate investment portfolio, leveraging professional real estate expertise with technology, scale, and local market insights to generate attractive returns for its Members and unique opportunities and value to the communities that it serves. The Company began substantive operations in May 2021.

Substantially all the Company's business is managed by Roots REIT Management, LLC (the "Manager"), a Georgia limited liability company. The Manager uses its resources to find and acquire residential real estate in the Atlanta-Sandy Springs-Alpharetta Metropolitan Statistical Area (the "Atlanta MSA"), that has value-add potential; however, the Manager is not limited to searching only in the Atlanta MSA.

On May 27, 2022, the Company filed an offering statement on Form 1-A with the SEC with respect to an offering (the "Offering") of up to $75,000,000 of the Company's units of membership interest ("Units" or "Member Units"), for an initial price of $110.00 per Unit.

A maximum of $75,000,000 in the Company's Units may be sold to the public in this Offering. The Manager has the authority to issue an unlimited number of Units. Seed InvestCo, LLC (the "Sponsor"), the owner of the Manager, received 500 Units for $1,000 in exchange for organization and formation costs incurred on behalf of the Company. Prior to the Offering receiving qualification by the SEC, the Company sold approximately 63,735 Units at prices ranging from $100.00 to $110.00 per Unit for a total of $6,525,654. The Offering received qualification on June 21, 2022. Between June 22, 2022 and December 31, 2022, the Company sold approximately 20,279 Units at prices ranging from $100.00 to 115.00 per Unit, for a total of $2,289,000. Between January 1, 2023 and December 31, 2023, the Company sold approximately 124,787 Units at prices ranging from $108.00 to $126.00 per Unit, for a total of $15,366,166. Between January 1, 2024 and June 30, 2024, the Company sold approximately 96,785 Units at prices ranging from $126.00 to $131.00 per Unit, for a total of $12,769,236. In aggregate, the Sponsor purchased approximately 2,723 Units at prices ranging from $100.00 to $131.00 per Unit, for a total of $198,230.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements of the Company are prepared on the accrual basis of accounting in accordance with U.S. Generally Accepted Accounting Principles ("GAAP").

The consolidated financial statements of the Company include the accounts of the Company, Joe Jerkins LLC, Dobis Delaware LLC, Natti's Properties LLC, XYZ Westchase Townhomes LLC, Roots TRX Tranche1 SFR LLC, Roots TRX Tranche 2 SFR LLC, and Roots TRX Tranche 3 SFR LLC, its wholly-owned subsidiaries. All significant intercompany accounts and transactions among the Company and its subsidiaries have been eliminated in consolidation.

Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions are based on management's best judgment. Actual results could materially differ from those estimates.

Real Estate Acquisitions

The Company acquires real estate assets from its Manager or Sponsor, both of which are related parties of the Company. As a result of the related party nature of the transactions, the Company is required to record the real estate assets acquired at the related party's historical cost, or carryover basis. The difference between the purchase price to acquire the real estate assets and the carryover basis in the real estate assets results in a reduction of the Company's capital (see Note 3). The Company recognizes an asset acquired from the Manager or Sponsor and begins recording activity related to the asset as of the execution of the deed transfer.

Depreciation

Depreciation of buildings and building improvements is computed on the straight-line method over an estimated useful life of 27.5 years. Improvements are capitalized, while expenditures for maintenance and repairs are charged to expense as incurred. Depreciation expense amounted to $361,001 and $130,582 for the six months ended June 30, 2024 and 2023, respectively, and is included in depreciation expense in the accompanying consolidated financial statements.

Impairment of Real Estate

The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of real estate may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of real estate may not be recoverable, management assesses whether the carrying value of the asset will be recovered through the future undiscounted operating cash flows expected from the use of and eventual disposition of the asset. If, based on the analysis, the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment charge to the extent the carrying value exceeds the estimated fair value of the asset. For the six months ended June 30, 2024 and 2023, the Company did not record any impairment charges related to its real estate assets.

Revenue Recognition and Expenses

The majority of the Company's revenue is earned through the lease of rental space at its underlying residential properties. These revenues are accounted for as leases under Accounting Standards Codification Topic 842, Leases ("ASC 842").

Interest income is recognized on the accrual basis and recorded in the period in which it is earned.

Expenses are recognized when incurred.

Cash, Cash Equivalents and Restricted Cash

		June 30, 2024			December 31, 2023
Cash and cash equivalents		$	421,265			$	780,323
Restricted cash			149,629				54,593
Total cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows		$	570,894			$	834,916

The Company classifies short-term, highly liquid investments with original maturities of approximately 90 days or less and money market accounts as cash equivalents. The Company invests its cash primarily in deposits and money market funds with commercial banks. At times, cash balances may exceed federally insured amounts. Management believes it mitigates credit risk by depositing cash in and investing through major financial institutions.

Restricted cash consists of amounts held in escrow accounts.

Resident Receivables

Resident receivables are comprised of rents and other fees due from residents. The Company assesses the collectability of resident receivables on an ongoing basis and makes valuation adjustments as needed based upon its estimate of the likelihood of collectability of amounts due from residents. Recoveries of resident receivables previously written off are recorded as recoveries when received. The allowance for credit losses was $0 as of June 30, 2024 and December 31, 2023.

Deferred Financing Costs and Amortization

Deferred financing costs represent costs incurred to obtain financing. They are recorded at cost and amortized using a method which approximates the effective interest method over the life of the related loan. Deferred financing costs are presented as a direct deduction from the carrying amount of the mortgage loans payable in the accompanying consolidated financial statements. For the six months ended June 30, 2024 and 2023, the Company incurred financing costs of $173,751 and $36,430, respectively. In addition, for the six months ended June 30, 2024 and 2023, amortization of deferred financing costs totaled $16,811 and $38,387, respectively, which is included in interest expense in the accompanying consolidated financial statements.

Unit Redemptions

The Company offers partial liquidity for its Members on a quarterly basis in the form of a partial redemption by the Company of a Member's Units. Each quarter, no more than 5% of the issued and outstanding Units may be redeemed (the "Aggregate Redemption Cap"), and no more than $100,000 of an individual Member's Units may be redeemed in any one quarter. In the event that a redemption request is made by multiple Members, so that the total redemptions requested would be greater than the applicable Aggregate Redemption Cap, the requested redemptions will be maxed at the Aggregate Redemption Cap and will be split among each requesting Member pro rata based on such Member's redemption request compared to the aggregate redemptions requested for that quarter. The window to request a redemption will begin on the fifteenth (15th) calendar day prior to the end of the applicable quarter and will end on the last day of such quarter. The redemption price per Unit will be the established value per Unit for the quarter then ending. The redemption price per Unit will be decreased by 6% if a Member requests a redemption (and participates in such redemption) within the first year of such Member's ownership of Units. The Manager reserves the right, in its sole and absolute discretion, to suspend the Company's offer for redemption at any time, without notice, for any reason or no reason.

For the six months ended June 30, 2024, the Company redeemed approximately 5,769 Units at prices ranging from $100 to $131 per Unit, for a total of $905,943. For the six months ended June 30, 2023, the Company redeemed approximately 818 Units at prices ranging from $100 to $120 per Unit, for a total of $85,734.

Because the net asset value ("NAV") per unit is calculated at the end of each quarter, the redemption price for Units held at least ninety (90) days may change between the date the redemption request is received and the date on which redemption proceeds are paid. As a result, the redemption price that a Member will receive may be different from the redemption price on the day the redemption request is made.

In addition, the Manager may, in its sole discretion, amend, suspend, or terminate the redemption plan at any time without notice, including to protect the operations and the non-redeemed Members, to prevent an undue burden on liquidity, to preserve the status as a REIT, following any material decrease in the NAV, or for any other reason. However, in the event that the Manager amends, suspends or terminates the redemption plan, an offering circular supplement and/or Form 1-U, as appropriate, will be filed, to disclose such amendment. The Manager may also, in its sole discretion, decline any particular redemption request if it believes such action is necessary to preserve the status as a REIT.

Distributions

The Company expects to declare distributions on a quarterly basis, or less frequently as determined by the Manager. Any distributions will be made at the discretion of the Manager, and will be based on, among other factors, the Company's present and reasonable projected future cash flow. The Manager has declared quarterly distributions of $1.50 per Unit for Members of record as of the close of business on March 31, 2024 and June 30, 2024. As of June 30, 2024 and December 31, 2023, distributions in the amount of $427,083 and $295,531, respectively, were declared, of which $427,083 and $295,531 were accrued and included in distributions payable in the accompanying consolidated financial statements, respectively.

Income Taxes

The Company has made an election to be taxed as a REIT under the Internal Revenue Code of 1986, as amended, and operates as such. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the Company's annual REIT taxable income to its Members (which is computed without regard to the dividends paid deduction or net capital gains and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, the Company generally will not be subject to U.S. federal income tax on income that it distributes to its Members, provided that it distributes 100% of its REIT taxable income. Even if the Company qualifies for taxation as a REIT, it may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed income.

Risks and Uncertainties

In the normal course of business, the Company encounters economic risk, including interest rate risk, credit risk, market risk and inflation risk. Interest rate risk is the result of movements in the underlying variable component of the mortgage financing rates. Credit risk is the risk of default on the Company's real estate assets that results from an underlying resident's inability or unwillingness to make contractually required payments. Market risk reflects changes in the valuation of real estate assets held by the Company. Inflation risk is the risk that rising prices could increase the Company's operating expenses and impact residents.

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), together with subsequent amendments, updates and extensions of the effective date (collectively "ASC 326"), which requires entities to measure all expected credit losses for financial instruments measured at amortized cost at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. One of the amendments to ASC 326 clarified that receivables arising from operating leases are not within the scope of ASC 326 and should continue to be accounted for in accordance with ASC 842. ASC 326 was effective for the Company as of January 1, 2023. The adoption of ASC 326 did not have a material impact on the Company's financial statements.

3. Real Estate

During the six months ended June 30, 2024, the Company acquired 47 properties located in the Atlanta MSA for an aggregate purchase price of $11,707,000. During the six months ended June 30, 2023 the Company acquired 23 properties located in the Atlanta MSA for an aggregate purchase price of $6,478,326 and sold one property for $320,668. The table below shows aggregate asset acquisition detail as of June 30, 2024 and June 30, 2023:

		June 30, 2024			June 30, 2023
Land		$	2,550,329			$	1,231,389
Building and improvements			8,106,863				4,152,404
Capital reductions			1,049,808				1,094,533
		$	11,707,000			$	6,478,326

4. Mortgage Loans Payable

During December 2021, the Company obtained a mortgage loan, secured by real estate assets, totaling $1,350,000. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $1,350,000. The loan matures on December 29, 2031 and bears interest at a rate of 3.51% for the first 84 months and thereafter at a variable rate based on SOFR plus 3.25% through the maturity date. Interest only payments are due on a monthly basis through the maturity date.

During April 2022, the Company obtained a mortgage loan, secured by real estate assets, for $1,451,329. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $1,451,329. The loan matures on May 9, 2027 and bears interest at 6.40%. Interest only payments are due on a monthly basis through the maturity date.

On January 5, 2023, the Company obtained a mortgage loan, secured by real estate assets, for $1,222,200. The loan matured on July 4, 2023. In July 2023, the loan was extended to January 4, 2024. In January 2024, the Company extended an existing mortgage loan of $1,222,200 until January 4, 2025. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $1,222,200 and bears interest at 8.00%. Payment of principal and interest is due at the loan maturity date.

On March 8, 2023, the Company extended an existing mortgage loan of $912,101 until March 8, 2024 and extinguished part of the mortgage loan by paying down the principal by $132,000. The loan matured on March 8, 2024. In March 2024, the Company extended the existing mortgage loan of $780,101 until September 8, 2024. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $780,101 and bears interest at 8.00%. Payment of principal and interest is due at the loan maturity date.

On March 31, 2023, the Company assumed a loan, secured by real estate assets, for $2,348,250. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $2,348,250. The loan matures on October 21, 2028 and bears interest at a fixed rate of 4.33%. Interest only payments are due on a monthly basis through the maturity date.

On April 14, 2023, the Company obtained a mortgage loan, secured by real estate assets, for $1,483,950. The loan matured on July 14, 2023. On July 14, 2023, the loan was extended to October 14, 2023. On October 14, 2023, the loan was extended to January 14, 2024, and $308,750 of the balance was paid off. On January 31, 2024, the Company extinguished the mortgage loan by paying down the loan principal of $1,175,200. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $0 and $1,175,200, respectively.

On July 17, 2023, the Company obtained a mortgage loan, secured by real estate assets, for $1,699,100. The loan matured on January 17, 2024. On January 18, 2024, the Company extended the existing mortgage loan of $1,669,100 until March 18, 2024. On March 18, 2024, the Company extended the mortgage loan until May 17, 2024. On June 14, 2024, the outstanding amount of $1,699,100 was paid off. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $0 and $1,699,100, respectively.

On November 13, 2023, the Company obtained a mortgage loan, secured by real estate assets, for $2,500,000. The loan matured on February 13, 2024. On February 13, 2024, the Company extended the existing mortgage loan of $2,500,000 until May 20, 2024. On June 14, 2024, the outstanding amount of $2,500,000 was paid off. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $0 and $2,500,000, respectively.

On December 31, 2023, the Company assumed a loan, secured by real estate assets, for $1,100,000. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $1,100,000. The loan matures on July 1, 2025 and bears interest at a fixed rate of 5.50%. Interest only payments are due on a monthly basis through the maturity date.

On June 13, 2024, the Company obtained three mortgage loans, secured by real estate assets, for $4,167,400. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $4,167,400 and $0, respectively. The loan matures on July 1, 2054 and bears interest at a rate of 7.00% for the first 120 months and thereafter at a variable rate based on SOFR plus 5.00% through the maturity date. Interest only payments are due on a monthly basis through the maturity date.

On June 30, 2024, the Company assumed a loan, secured by real estate assets, for $329,537. As of June 30, 2024 and December 31, 2023, the outstanding principal balance was $329,537 and $0, respectively. The loan matures on January 1, 2052 and bears interest at 3.875%. Interest only payments are due on a monthly basis through the maturity date.

For the six months ended June 30, 2024 and 2023, the Company incurred interest expense related to its mortgage loans payable of $429,075 and $190,062, respectively, which is included in interest expense in the accompany consolidated financial statements.

As of June 30, 2024 and December 31, 2023, the amounts outstanding under the mortgage loans payable and unamortized deferred financing costs were as follows, respectively:

		June 30, 2024			December 31, 2023
Mortgage loans payable		$	12,748,817			$	13,626,180
Less: unamortized deferred financing costs			(297,166	)			(140,226	)
Mortgage loans payable, net		$	12,451,651			$	13,485,954

As of June 30, 2024, future scheduled principal payments on mortgage loans payable are as follows:

As of June 30, 2024		Principal Due
July 1, 2024 to December 31, 2024		$	780,101
2025			2,322,200
2026			-
2027			1,451,329
2028			2,348,250
2029			-
Thereafter			5,846,937
Total		$	12,748,817

The Company intends to extend or refinance all mortgage loans due within the next year. The Company has a history of being able to do so and does not have any concerns with extending or refinancing mortgage loans as they come due.

5. Related Party Arrangements

Roots REIT Management, LLC and Seed InvestCo, LLC

Subject to certain restrictions and limitations, the Manager is responsible for managing the Company's affairs on a day-to-day basis. The Manager and Sponsor are responsible for identifying and making acquisitions and investments on behalf of the Company. As of June 30, 2024 and December 31, 2023, the Company had advanced $6,906,015 and $7,465,015, respectively, to the Sponsor for certain acquisitions identified. Advances bore interest at 6% through September 30, 2023 and bear interest at 7% beginning October 1, 2023. Interest is calculated on each individual advance as of the date of such advance. For the six months ended June 30, 2024 and 2023, the Company earned interest income related to advances to the Sponsor totaling $319,337 and $153,427, respectively. As of June 30, 2024 and December 31, 2023, $157,142 and $167,983, respectively, was accrued and included in due from related party, net in the accompanying consolidated financial statements.

The Manager may retain one or more of its affiliates to perform services for the Company's real estate investments, including property management, leasing, and construction management services.

The Manager is entitled to a 10% property management fee, which is calculated as 10% of all rents collected each month. The fee is paid monthly. During the six months ended June 30, 2024 and 2023, the Company incurred property management fees totaling $94,084 and $65,233, respectively.

The Manager is entitled to a repairs and maintenance fee. The fee is based on an agreed upon monthly amount per property assigned at the date the property is deeded to the Company. The fee covers the costs of normal maintenance and unexpected repairs. Any costs for covered maintenance and repairs in excess of the fee are paid for by the Manager. For the six months ended June 30, 2024 and 2023, the Company incurred repairs and maintenance fees totaling $115,146 and $56,822 respectively.

The Manager is entitled to a one-time acquisition fee for each property acquired by the Company. The fee is equal to 3% of the initial purchase price paid by the Manager. During the six months ended June 30, 2024 and 2023, the Manager elected to waive all acquisition fees.

The Manager is entitled to a one-time disposition fee for each property. The fee is equal to 3% of the final disposition value. For the six months ended June 30, 2024, the Company did not dispose of any properties. For the six months ended June 30, 2023, the Manager elected to waive all disposition fees.

The Manager is entitled to a leasing fee. The fee is based on $500 for a new lease and $250 for a lease renewal. For the six months ended June 30, 2024 and 2023, the Company incurred leasing fees totaling $11,000 and $4,250 respectively, which are included in operating and maintenance expense in the accompanying consolidated financial statements.

As of June 30, 2024 and 2023, $1,737 and $6,620 respectively, remained due to the Manager from the Company related to property acquisitions and other reimbursable expenditures. These amounts are included in due from related party, net in the accompanying consolidated financial statements.

6. Commitments and Contingencies

In the normal course of business, the Company may be subject to various litigation and in some instances the amount sought may be substantial. Although the outcome of such claims, litigation, and disputes cannot be predicted with certainty, in the opinion of management based on facts known at this time, the resolution of such matters are not anticipated to have a material adverse effect on the financial position or results of operations of the Company.

7. Subsequent Events

The Company evaluated subsequent events through September 19, 2024 which is the date the consolidated financial statements were available to be issued. Management has concluded that there were no significant events requiring recognition and/or disclosure in the consolidated financial statements other than those disclosed herein and below.

On July 2, 2024, the Company acquired a loan secured by real estate assets for an aggregate amount of $1,877,400.

On July 2, 2024, the Company acquired a loan secured by real estate assets for an aggregate amount of $1,461,000.

On July 22, 2024, the Company acquired a loan for $2,500,000.

On July 24, 2024, the Company purchased two properties for $6,736,750 in cash.

On July 29, 2024, the Company purchased two properties for $2,753,308 by securing a loan of $1,927,314 and paying cash of $825,994.

On July 29, 2024, the Company purchased one property for $1,625,286 in cash.

Between July 1, 2024 and September 19, 2024, the Company issued approximately 3,917 Units at a Unit price of $131.00 and approximately 47,653 Units at a Unit price of $133.00, for $6,851,048 in offering proceeds. As of September 19, 2024, the aggregate Units outstanding were approximately 339,530 Units for total offering proceeds of $41,386,505.

PART III - Item 4. Exhibits

Index to Exhibits

Exhibit No		Description
2.1*		Certificate of Organization (Incorporated by reference to Exhibit 2.1 to the Company's confidential draft Offering Circular on Form 1-A, filed on February 24, 2022)
2.2*		Certificate of Amendment (Incorporated by reference to Exhibit 2.2 to the Company's confidential draft Offering Circular on Form 1-A, filed on February 24, 2022)
2.3*		Amended and Restated Operating Agreement (Incorporated by reference to Exhibit 2.3 to the Company's Offering Circular on Form 1-A POS, filed on March 12, 2024)
4*		Form of Subscription Agreement (Incorporated by reference to Exhibit 4 to the Company's Offering Circular on Form 1-A POS, filed on March 12, 2024)

*Previously filed.

SIGNATURES

Pursuant to the requirements of Regulation A, the issuer has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Roots Real Estate Investment Community I, LLC
	Roots REIT Management, LLC
	Manager
	/s/ Larry Dorfman
	Larry Dorfman
	Manager
	/s/ Daniel Dorfman
	Daniel Dorfman
	Manager
	Date: 09/27/2024

Pursuant to the requirements of Regulation A, this report has been signed below by the following persons on behalf of the issuer and in the capacities and on the dates indicated.

Signature		Title		Date
/s/ Daniel Dorfman		Principal Executive Officer of Manager
Daniel Dorfman		(Principal Executive Officer)		September 27, 2024
/s/ Larry Dorfman		Principal Financial Officer of Manager
Larry Dorfman		(Principal Financial Officer)		September 27, 2024
/s/ Mel Myrie		Principal Accounting Officer of Manager
Mel Myrie		(Principal Accounting Officer)		September 27, 2024

Safe Harbor Statement

This Semiannual Report on Form 1-SA contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, and descriptions of goals and objectives. You can identify these forward-looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "projects," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words, which generally are not historical in nature. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Some of the factors that may affect outcomes and results include, but are not limited to: (i) national, international, regional and local economic and political climates, (ii) changes in global financial markets and interest rates, (iii) increased or unanticipated competition for our properties, (iv) risks associated with acquisitions, dispositions and development of properties, (v) maintenance of real estate investment trust status, tax structuring, and changes in income tax laws and rates, (vi) availability of financing and capital, the levels of debt that the Company maintain and its credit rating, (vii) risks of pandemics such as COVID-19, including escalations of outbreaks and mitigation measures imposed in response thereto, (viii) environmental uncertainties, including risks of natural disasters, and (ix) those additional factors described under the section entitled "Risk Factors" in the Company's offering circular, dated March 11, 2024 and filed by us with the Securities and Exchange Commission (the "Commission") on March 12, 2024, as amended (the "Offering Circular"), as such factors may be updated from time to time in the Company's subsequent filings with the Commission, which are accessible on the Commission's website at www.sec.gov. In addition, past performance is not indicative of future results. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the Company's filings with the Commission. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

Public link

Please use the above public link if you want to share this noodl on another website.