When investing as a passive partner in a real estate project, cash distributions are computed and made using a ‘waterfall,’ most of which are constructed according to somewhat uniform criteria, and some are more creative. Real estate syndications use these “waterfalls” to set up and pay principals and investors. Once a developer sets up a […]
EVERYTHING YOU SHOULD KNOW ABOUT REAL ESTATE WATERFALLS Read More »
In private investing, waterfalls, clawbacks, and catch-ups are phrases used to explain how distributions flow from the investment to the partners, what happens if things don’t go as expected, and the manager’s performance fee concept. Knowing how an investment’s waterfall works is critical because an unfavorable one might tip risk in the investor’s favor. The
FACTS ABOUT PRIVATE EQUITY WATERFALLS, CLAWBACKS, AND CATCH-UP CLAUSES Read More »
Understanding of Equity Waterfalls When investors go from residential to commercial real estate, they are confronted with a whole new and sometimes perplexing lexicon. The majority of this new terminology pertains to commercial lending. The notion of equity waterfalls, in particular, confuses many novice investors. Despite the complexity of these currency distribution schemes, their core
WHAT IS EQUITY WATERFALLS? Read More »
