There is a waterfall payout which puts the investors as the priority to pay first. There will be a preferred return and a split of income/equity once the preferred return has been met. The percentages will depend on the deal- but typcially the preferred return is in the 5%-7% range

The biggest risk is losing the asset itself (ie the destruction of the entire building) which is extremely rare. Most major risks can be managed (eg unit fire prevention). Risks not in our control are natural disasters (eg exterior fires, earthquakes, flooding etc.). Many common risks can be mitigated through proper management.

The investor doesn't need to have any knowledge of real estate investing. The fund manager will run and manage the whole operation. However, there will be meetings that allow the investor the opportunity to personally learn investing in real estate.

Absolutely not! While real estate is a longer term investment play. Exits from an investment can be as short as 5 years. Also real estate investments can be transferred to inheretance. Consulting a licensed estate planner is recommended to set up the proper vehicle for any given investor.

3 Examples

6 units (1 bdrms) Acquired 1999

268% Appreciation 10.3% Annual Return

16 Units (Studio/1bdrm) Acquired 2002

154% Appreciation 6.7% Annual Return

15 Units (1 and 2 Bdrm) Acquired 2009

114% Appreciation 7.1% Annual Return

Drivers of Value

- Time

- Frequent Turnover

- Unit Renovations

- Managing Operating expenses

It will be a partnership structure where the Fund Manager will be the General Partner and the investors will be Limited Partners. The General Partner is responsible for all the operations of the Fund. The Limited Partners will have no operational obligations.