Unlock Your Path to Financial Freedom

• 5-10 year hold to provide ample time to execute a capital improvement plan
• A portion of investor principal could be returned between years 3-5 from a capital
• Continue to cash flow for 7-10 years as we search for an opportunistic sale

A passive investor is someone who invests in a property but is not actively involved in its day-to-day operations.

The current requirements to qualify are annual income of $200,000 or $300,000 for joint income for the last two years with expectation of earning the same or higher or a net worth exceeding $1 million either individually or jointly with a spouse (excluding personal residence).

A sophisticated investor is someone deemed to have sufficient investing experience and knowledge to weigh the risks and merits of an investment opportunity. If you do not qualify as an accredited investor, you can become sophisticated through building a relationship with the sponsor. To start the investment process with us, schedule a 20 minute free call or fill out our new investor questionnaire

You may be able to resell your portion of the investment in a private transaction subject to restrictions that are specific to each investment and under the Securities Act of 1933. Every deal has a specific operating agreement that will spell out this language. Since the resale restrictions can be very limiting, you should not invest with the expectation of reselling your investment.

A “market downturn” is a situation in which market conditions are not conducive to a profitable sale of the property.  Typically, we will not sell in a down market.  Instead, the goal would be to continue to cash flow and hold until the market is healthier to achieve a better price at sale.  Class B/C value-add properties (our investment target) tend to be resistant in downturns because folks need a place to stay, rents are more in line with the market, and the service economy demographic that stay in class B/C properties, are typically still employed in downturns versus the higher paid class A renters whose jobs are more at risk.

The returns forecasted to you are after fees.  The most common fee is an acquisition fee based on purchase price and is paid upon closing.  This covers the general partner’s costs to find the deal and get it under contract.  The other most common fee is the asset management fee, which is compensation for holding the property manager accountable, ensuring execution of the business plan, bookkeeping, and distribution of checks and K-1s.  The asset management fee is aligned with the investor’s interest as it is based on the property’s revenues.  The industry average for these fees are 1-3% for each.

There are many tax advantages to investing in commercial real estate that minimize your tax liability such as depreciation. Unlike your ordinary income, real estate income is subject to depreciation, which allows you to write off a certain amount of your income. For example, if a property generates $100,000 after debt service, and has a depreciation of $60,000, the taxable income is only $40,000. However, we have experienced investments that have depreciations that covered the entire income produced by the property and allowed for a ‘paper loss’ that could be passed on to other investment income.