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Your Money, Your Rules: A Comprehensive Guide on Self-Directed IRAs for Passive Investors
In 2016, I made the switch to self-directing my retirement funds to make real estate investing easier. It took a lot of research to get my questions answered. This article is the one I wish I had read back then. When I made the switch, there weren’t any go-to resources that would answer my most…
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Ready to Submit Your First ‘Soft Reserve’?
You may have received an email from us with an offering announcement and had questions about the process for submitting your first soft reserve. After reading this article, you should have a better understanding of our internal processes including the three strikes and you’re out rule. What is a Soft Reserve? Our offerings are released…
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The Benefits of Bonus Depreciation for Passive Real Estate Investors
Are you an investor looking to maximize your potential returns? In the world of passive real estate investing, there is a game-changing benefit that can significantly boost your bottom line—bonus depreciation. This powerful tax strategy is not only a goldmine for investors but also a secret weapon for building long-term wealth. The Three Kinds of…
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Understanding Real Estate Revenue Terms
The accounting world, and specifically multifamily, self-storage, hotel, and car wash accounting, tend to use words or phrases that can be tricky to remember. This article focuses on defining common revenue-related accounting terms. If you know a term, skip to the next one. Gross Potential Rent (GPR) – The total amount of revenue a property…
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Tracking Your Unreturned Capital Contributions
If you have ever invested in one of our projects or another private equity real estate offering, then you have likely encountered the term “unreturned capital contribution.” This is another term that is sometimes understood but many investors do not have a full grasp as to why this term is so important for your overall…
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Equity Waterfall Structures and Hurdles
What are equity waterfalls? An equity waterfall is the breakdown in a private equity real estate transaction that outlines how the distributions will be handled between the operator and, you, as the passive investor. In private equity real estate transactions there are typically 3 different waterfalls to consider: Cash Flow Waterfall: how the cash flows…
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The Lazy 1031 – A Viable Alternative to a 1031 Exchange
Three years ago, I sold four of my single-family properties to take advantage of what I thought was the top of the Indianapolis real estate market. However, the sale would trigger a significant capital gains tax (fortunately I was making money on them), and I would also have to pay the depreciation recapture since I…
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IRR – The Internal Rate of Return Metric
What is the Internal Rate of Return and How is it Calculated? The internal rate of return (IRR) is the most used calculation in private equity real estate investments. The IRR is a discount rate that causes the net present value (NPV) of all the cash flows throughout the investment to become equal to…
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The Importance of Understanding the Capital Stack
What is a Capital Stack? A capital stack consists of the total capital invested in the project. For multifamily real estate, the capital stacks will be comprised of a combination of senior debt, mezzanine debt (optional), common equity, and preferred equity (optional). Having a clear understanding of the capital stack in each investment offering is…
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Capital Markets Explained
In life, there are things you simply cannot control. Uncontrollable factors create risk. If we could control everything, then we would never allow a negative. If we never encountered a negative, then we would never grow. Resistance equals strength. Strength is growth, and growth causes movement, and movement causes you to encounter even more uncontrollable…
