What type of real estate assets do we invest in and which markets do we focus on?

Single Family Home Development: For our for-sale, new construction, single-family home investments we are focused in Culver City, CA exclusively. This sub-market of Los Angeles is a “small city in a large city.” Culver City is a separate city centrally located in L.A. with it’s own planning department, building & safety, police & fire department and award winning school district. Culver City is home to some of the largest employers in the entertainment industry including Sony, Amazon, Apple+, Warner Media, HBO and has developed a downtown that is full of amazing restaurants and bars.

Multi-Family Value-Add Apartments: When it comes to value-add apartment investments, we have worked in almost every major market west of Denver, CO. Typically, we are chasing higher yield in secondary markets with strong employer base and demand for work-force-housing. Our projects are value-add acquisitions where the apartments units and facility needs to be renovated and modernized with upgraded amenities to justify increasing rents/revenue.

Our financial proforma models for underwriting deals stress each opportunity with a variety of variables that could affect the deal. Unless certain thresholds in our financial modeling are made, we do not buy the deal. Every deal we put together, we personally invest our money ensuring everyone’s interests are fully aligned.

What is a real estate syndication and how does it work?

The main goal of a real estate syndication is to gather a group of investors together to purchase a property. Typically, the partnership is formed with a Specific-Purpose, Limited Liability Corporation (LLC) and the investors are Limited Partners (aka LPs/Members/Equity Partners) and the General Partner (aka GP/Lead Investor/Sponsor) is the Manager of the LLC. The partnership is outlined in an Operating Agreement (OA) which describes roles, rights and terms of the investment. Investing in a real estate syndication with an LLC is a Private Equity investment that typically offers LPs Preferred Returns before any profits are split among the ownership.

What is a Specific-Purpose LLC?

An LLC for real estate is a legal entity that allows investors to purchase and own real estate in such a way that protects them from personal liability. The LLC owns the property, and each investor owns a portion of the LLC. This means that the investor buys and sells real estate and conducts other business in the name of the LLC rather than as an individual. If any outside entities or individuals make a claim, the individuals behind the entity can avoid personal liability. Also, property owners are allowed to establish individual LLCs for each separate property, meaning that they can avoid cross-liability between properties.

What are the different types of Equity we work with?

Joint Venture Equity
A joint venture (JV) is a business arrangement (partnership) in which two or more companies work together on a specific real estate project. The parties involved in the JV pool their resources, including capital, intellectual property, and expertise to develop a real estate project. The partners in the JV share the risk and rewards of the project based on the terms in the agreement.

Co-GP Equity
Co-GP equity in a real estate investment refers to the ownership stake that a co-general Partner (Co-GP) holds in a real estate investment fund or property. In real estate investment, a General Partner (GP) is responsible for managing the day-to-day operations of the investment, while Limited Partners (LPs) provide capital to the fund. In a co-GP arrangement, two or more individuals or entities serve as the GPs and share the responsibilities and decision-making authority. Co-GP equity is a common structure in real estate investment, as it allows multiple parties to share the responsibilities and rewards of managing the investment. It also provides a mechanism for risk sharing, as each co-GP is responsible for a portion of the investment's success or failure.

Preferred Equity
Preferred equity in a real estate investment refers to a type of equity ownership in a property or real estate fund that gives the holder certain preferences over other equity holders. Preferred equity holders typically receive a higher rate of return on their investment compared to common equity holders and have a higher priority in receiving distributions from the property or fund. In the event of a liquidation or sale of the property, preferred equity holders also typically receive their investment back before common equity holders.

What is a Preferred Return?

The Preferred Return, sometimes called the hurdle rate, is basically a minimum annual return that the limited partners are entitled to before the general partners may begin receiving a portion of the profits. Typically, a Preferred Return ranges from 8% to 12% depending on the profile of the investment, risks and the overall business plan for the property. New construction development deals will have a higher pref than value-add apartments.

What is an Accredited Investor?

To qualify as an accredited investor, a person must have an annual income exceeding $200,000 ($300,000 for joint income) for the last two years with the expectation of earning the same or a higher income in the current year.

A person is also considered an accredited investor if they have a net worth exceeding $1 million, either individually or jointly with their spouse excluding the value of their primary residence.

Who are our investors?

Our investors are our Accredited Family and Friends Network who want access to our deal flow of high-quality, well located assets but don’t want to deal with all the headaches of managing real estate investments. As passive investors, our network is looking for diversification that can have high returns without being exposed to personal liability or credit risk. Our goals are focused on building long-term wealth and creating passive income to our network that is streamlined and sustainable for the long haul.

What is the minimum investment in our syndications?

Our minimum investment in each offering is typically $25,000.

Can I participate if I’m not an Accredited Investor?

Yes, we do allow “sophisticated investors” who do not qualify under the accredited definition if there is clear understanding by the sophisticated investor about the investment, terms and risks involved.

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