Imagine losing hundreds of thousands of dollars on a promise to “invest like the 1%.” That’s the harsh reality for many who trusted Yieldstreet, a fintech platform that pitched exclusive real estate deals to everyday investors. Their dreams of wealth-building have turned into staggering financial setbacks.
According to CNBC, Yieldstreet, founded in 2015, has left investors like Justin Klish reeling from massive losses in real estate projects, hit hard by rising interest rates and tough market conditions, with multiple defaults and total wipeouts.
Back in February 2022, Klish, a 46-year-old from Miami working in financial services, stumbled upon a Yieldstreet ad. Lured by the prospect of elite-level returns, he poured $400,000 into two projects: a luxury apartment in Nashville tied to a prominent family office and a renovation in Chelsea, New York. Both dangled annual returns near 20%.
Yieldstreet, launched by Michael Weisz and Milind Mehere, aimed to open up alternative investments like real estate to retail players. With a minimum buy-in of $10,000 per deal, it attracted those hungry for wealth-building beyond stocks and bonds. But cracks emerged fast.
By early 2022, the Federal Reserve kicked off aggressive rate hikes, slashing multifamily property values by 19%. Yieldstreet’s projects struggled with revenue shortfalls, vacancies, and stalled rent growth. Investors like Klish started noticing delays in updates by early 2023, hinting at trouble.
CNBC reviewed investor letters showing over $370 million funneled into 30 real estate deals from 2021 to 2024. Of these, four are total losses, 23 linger on a “watchlist” for possible recovery, and three active deals have halted payouts. This isn’t just a hiccup—it’s a systemic stumble.
In May 2025, Yieldstreet declared the Nashville project a complete loss, erasing $300,000 of Klish’s stake. Another letter warned that the Chelsea project needs fresh capital to avoid collapse. Defaults also hit projects in Atlanta and New York’s Upper West Side, with the latter sold for a mere $1 after recovery efforts failed.
Other investors share Klish’s pain. Mark Underhill, a 57-year-old software engineer, lost $200,000 of his $600,000 investment across 22 funds, many on watchlists with no payouts. Louis Litz, a 61-year-old from Pennsylvania, saw three of his deals default out of a $480,000 stake, lamenting, “I’m 61, so there’s no way I can really recover.”
Klish, frustrated, filed an SEC complaint in July 2025, claiming Yieldstreet misled investors. He’s still awaiting a response. “There isn’t a day that goes by without me saying, ‘I can’t believe what happened,’” he told CNBC.
Yieldstreet’s woes aren’t new. In 2020, it faced losses on commercial ship loans, sued a Dubai firm for fraud over $89 million in member loans, and saw a brief partnership with BlackRock dissolve amid market turmoil. By 2023, the SEC fined Yieldstreet $1.9 million for mishandling a marine loan deal despite known risks.
Real estate, making up 26% of Yieldstreet’s portfolio by 2023, became its largest asset class. Yet returns plummeted from 9.4% annually in 2023 to just 2% recently. Transparency took a hit, too, with quarterly portfolio updates halted after early 2023.
Last year, Yieldstreet shuttered a real estate trust of six projects, its value halved, locking up client funds for at least two years. Rescue attempts, like a $3.1 million member loan for the Nashville property, failed within months. The property was sold in May 2025, resulting in a full loss.
In May 2025, Yieldstreet replaced CEO Michael Weisz with Mitch Caplan, a former E-Trade executive. By July, a $77 million capital raise was announced, led by a firm where Caplan serves as president. No reason for the leadership switch was disclosed. This month, Yieldstreet became a broker-dealer, planning to offer funds from giants like Goldman Sachs, targeting 70% of funds from established firms. But can this pivot rebuild trust? Investors remain skeptical after years of “confidential” updates and restricted information sharing.
For wealth-builders, Yieldstreet’s saga is a cautionary tale against chasing high returns without scrutinizing risks. Diversify, research, and question platforms promising elite access—true financial liberty comes from discipline, not hype. Start by vetting any alternative investment with the same rigor you’d apply to a stock or bond.