August 2023

HOW MANY PROPERTIES MUST I OWN TO ADEQUATELY DIVERSIFY?

Leave a Comment / Crowdfunding, Investment, Portfolio / / August 27, 2023 / , , , ,

Ranging between 120 and “hundreds.” This renders specific crowdfunding platforms unsuitable for non-speculative investments. Since this post was published in 2015, things have substantially improved for some investors. Many real estate crowdfunding platforms have expanded beyond single-property investments, allowing pooled investments in many properties. These enable an investor to swiftly amass portfolios of over 120 […]

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HOW INTERNAL RATE OF RETURN (IRR) CAN MISLEAD INVESTORS?

Leave a Comment / Investment, Returns / / August 27, 2023 / , ,

Private investment managers are now evaluated based on their internal rate of return (IRR), but all investors need to be mindful of the severe disadvantages of this metric. The annualized return statistic captures the compounding of money over time, while IRR does not. Many investors make the expensive error of comparing IRR to annualized returns

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HOW DOES COMMERCIAL REAL ESTATE VALUATION WORK?

Leave a Comment / Investment, Returns, Valuation / / August 27, 2023 / , ,

What Is the Process of Commercial Real Estate Valuation? Knowing how to accurately assess commercial real estate is perhaps the most crucial consideration when deciding whether to include it in your investment portfolio. The ability to effectively analyze acquisition assets and your own holdings is a talent that every serious commercial real estate investor must

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FORECAST FOR REAL ESTATE INVESTMENT TRUSTS (REITS)

Leave a Comment / Investment, REIT, Returns, Taxes / / August 27, 2023 / ,

The real estate business has been extraordinarily volatile over the last year, and this heightened volatility has had a direct impact on the real estate investment trusts (REITs) market. Most REIT and REIT-related firms have suffered dramatic price movements in positive and negative directions during the previous twelve months. It may be challenging to navigate

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DESPITE INFLATION, IS COMMERCIAL REAL ESTATE A GOOD INVESTMENT?

Leave a Comment / Inflation, Investment, Portfolio / / August 27, 2023 / , , ,

Successful real estate investors have long recognized the need to include commercial real estate in their portfolios. Even though residential real estate investments are a reliable source of passive income, several elements must have considered. For example, if you invest in residential properties by fixing them up and reselling them, you must buy in an

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CROWDFUNDING’S EFFECT ON REAL ESTATE WATERFALL STRUCTURES

Leave a Comment / Crowdfunding, Returns, The Real Estate Cycle, Waterfalls / / August 27, 2023 / , , , ,

Real estate developers use Waterfall calculations to compute payouts to investors over the life cycle of a project. Since the advent of real estate crowdfunding, there have been considerable alterations in how they are organized, with significant repercussions. As the proverbial tail wags the dog, one tendency involves investors dictating how sponsors underwrite and market

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THE CAPITAL STACK EXPLAINED

Leave a Comment / Capital Stack, Investment / / August 27, 2023 / ,

When describing the financial framework of a real estate transaction, the term “capital stack” is commonly used (frequently depicted as a bar graph or pyramid). The capital stack defines the many forms of capital invested in a real estate asset and their respective relationships. There are traditionally two primary categories of capital: Experience and Risk

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BEWARE OF SPONSOR PROMISES OF A “DEMOGRAPHIC TAILWIND”

Leave a Comment / How to evaluate your sponsor, Sponsor, What is Sponsor / / August 25, 2023 / , , ,

A dry real estate report conceals a bombshell: One of the most common methods investors choose the “best” investment is often incorrect. Paul Kaseburg, author of “Investing in Real Estate Private Equity,” has participated in over $1.7 billion of real estate transactions on both sides of the table. According to him, one of the most

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A STRATEGIC ADDITION TO A TRADITIONAL PORTFOLIO OF STOCKS AND BONDS

Leave a Comment / Investment, Portfolio, Strategy / / August 25, 2023 / , , , , ,

Did You Know That Real Estate Earns More Than Stocks and Bonds? With Less Volatility? A portfolio with some allocation to private real estate has historically demonstrated the ability to generate greater returns, with typically higher annual income and lower volatility, compared to a standard portfolio consisting of 60 percent large-cap stocks and 40 percent

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ALL ABOUT ACQUISITION DUE DILIGENCE

Leave a Comment / Development, Due diligence, Environmental, Opportunity zones / / August 25, 2023 / ,

Advanced Research for Purchase Acquisition Due Diligence Finding the ideal property to put an offer on is simply the first step in becoming a property owner. Before closing, a great deal occurs behind the scenes to verify that the property is a suitable addition to your portfolio. Before making an offer, you have run the

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