IS THIS A BLIND FUND?
The Fund is semi-blind in that the managers have already invested in fund assets. As additional capital is raised new assets will be added. All investors in the fund receive investment exposure across all assets.
CAN I INVEST THROUGH AN IRA OR RETIREMENT ACCOUNT?
Yes, investors can invest through a self-directed IRA. We can assist in the set-up with a custodian if necessary.
WHEN DO I BEGIN TO ACCRUE A RETURN?
Upon admittance into the Fund, an investor account begins to accrue a return 30 days after the effective date. The effective date is the date at which the manager transfers funds from the subscription account into the operating account in order to purchase one or more fund assets. We anticipate investors will begin to accrue a preferred return within 30-90 days of contributing capital to the fund.
WHEN WILL DISTRIBUTIONS LIKELY BEGIN?
The Fund’s goal is to begin distributions for investors within 1-2 quarters of each investor contributing capital to the fund. This is based on the timing of capital commitments and deal flow.
WHEN ARE DISTRIBUTIONS MADE?
The Fund intends to make distributions within 60 days after the close of each quarter.
WHAT KIND OF REPORTING WILL INVESTORs RECEIVE?
The managers furnish investors with a fund update quarterly. This includes an update on the performance of fund assets against projections and narratives around the market and the business plan for significant assets. Annually, investors will receive a K-1 for tax purposes.
ARE INVESTORS REQUIRED TO BE ACCREDITED?
Yes, the Fund is offering Units to investors under an exemption from securities registration afforded by Regulation D, Rule 506(c), which requires the Fund Manager to take “reasonable steps” to verify that each investor is “Accredited,” prior to allowing them admission to the company. For more information, visit https://www.sec.gov/fast-answers/answers-accredhtm.html.
WHAT IS THE DURATION OF THIS INVESTMENT?
An investment in the Fund is considered long-term in nature. Investors should be in a financial position that will enable an investor to hold its interest for the duration of the investment opportunity, which is projected to be 5-10 years. Investor are anticipated to begin receiving capital back in the first 3-5 years as portfolio assets either refinance or are sold.
IS AN INVESTMENT ELIGIBLE FOR A 1031 EXCHANGE?
WHY ARE SOME OF THE ANNUAL CASH FLOW PROJECTIONS LOWER THAN THE PREFERRED RETURN?
It is likely that during the first few years while value-add measures take place, the amount of cash flow available for distribution will be lower than the preferred return. Investors’ preferred return accrues annually, and any balance is carried over to the following year. Operational cash flow shall first be distributed to investors in proportion to their respective unpaid preferred return balance, until their unpaid preferred return balance is reduced to zero. Further proceeds from operational cash flow will then be distributed 70-80% to investors, and 20-30% to the fund manager. This structure highly incentivizes performance as the fund managers’ profits are primarily earned after investors receive their preferred return.
WHAT AM I ACTUALLY INVESTING IN?
Investors in the Fund are equity owners of multiple real estate assets. Investors own membership units in the Fund which is structured as a Delaware limited liability company. The Fund holds an ownership interest in real estate assets consistent with the Fund’s strategy.
WHAT IS AN OPERATING PARTNER?
Operating partners are real estate firms that specialize in acquiring and managing a specific type of real estate. The Fund partners with multiple operating partners in the real estate assets it owns. Our operating partners make the day-to-day decisions of managing the real estate and executing the business plan.
HOW DOES THE FUND SELECT OPERATING PARTNERS?
We source and underwrite our deals via established key relationships with institutional quality operating partners, many of which we have investment experience with. Our operating partners are the best of the best and many are amongst the top 50 largest owners in the United States in their respective asset classes. The fund managers’ extensive background and expertise providing a win-win for operating partners and investors allows us all to participate in many off-market private institutional grade investment offerings.
The fund manager has built extensive networks over the past decade to provide them with a competitive advantage in sourcing discounted properties. The fund manager has a highly selective asset selection criteria which results in the fund managers passing on more than 95% of the investment opportunities they see. Each and every deal placed in the Fund they would want to invest in directly or on its own, and all Fund properties will have value-add upside potential. Value add strategies will include the potential to increase ancillary income, improve operations, increase revenues, reduce expenses, and employ other various other measures to improve the properties.