Real Estate Funds are another method by which investors may pool their money to acquire real estate assets. These funds generally raise smaller amounts of money than a REIT (usually up to $25 million) and will typically acquire fewer properties than a REIT. They may also look to achieve more growth opportunity and as a result may be considered a more risky investment.
Most Real Estate Funds are considered exempt offerings under Rule 506 of Regulation D. This regulation exempts the offering from registration with the SEC and requires that investors meet certain income or net worth limits. Investors must be "accredited", which means they must have a net worth over $1 million, excluding equity in their primary residence, OR have individual annual income of $200,000 or more ($300,000 if filing jointly) in each of the two most recent years and a reasonable expectation of the same level in the current year. Different requirements apply for businesses, trusts or other entities.
Real Estate Funds will typically outline their acquisition, management and liquidation strategies in the Private Placement Memorandum (PPM). This document is intended to help investors better understand the objectives and risks associated with the investment. Investors should understand the risks associated with each investment prior to making an investment in a Real Estate Fund. These risks include, but are not limited to lack of liquidity, fees, ceasing of cash flow, market risk and the loss of principal. Representatives of Bridge Equities, Inc. can help potential investors understand these offerings and the benefits and risks associated with each particular investment.
The contents of this site constitute neither an offer to sell nor a solicitation of an offer to buy any security which can only be made by prospectus. Investing in real estate and 1031 exchange replacement properties may not be suitable for all investors and may involve significant risks. These risks include, but are not limited to, lack of liquidity, limited transferability, conflicts of interest and real estate fluctuations based upon a number of factors, which may include changes in interest rates, laws, operating expenses, insurance costs and tenant turnover. Investors should also understand all fees associated with a particular investment and how those fees could affect the overall performance of the investment. Neither Bridge Equities, Mike Bendix, nor DFPG provide tax or legal advice, as such advice can only be provided by a qualified tax or legal professional, who all investors should consult prior to making any investment decision.