A property’s revenue is derived from rents paid for the use of leased properties. A strong property management team will focus on attracting only the most suitable occupants to the properties and bind them to carefully structured lease agreements, contracted for long periods of time with staggered renewal dates. These practices in turn generate consistent cash flows for our Investor Partners.
By making improvements, the property values are increased through the repositioning process. By increasing rents or occupancy rates, higher levels of stable monthly distributions are generated. When properties are refinanced or sold, the proceeds can be used to acquire additional properties to further increase value and wealth preservation.
Steady Cash Flow
One of the greatest advantages of real estate investments is they generate steady, strong, partly tax-sheltered cash flow and provide distributions to the Investor Partners. With the other advantages real estate has to offer, few other forms of investments can be bought with the same kind of steady cash flow return combined with the appreciation of the investment over time.
Distributions to Investor Partners are treated more favorably than other investments from a tax perspective because a significant portion of distributions are not considered income. This is due to the flow through of expenses and depreciation. Furthermore, the capital appreciation is deferred from taxation until the assets are sold.
A property’s combination of stable revenue (from rents), capital gains (resulting from increased property values), and tax savings (thanks to the investment’s special flow-through structure) can provide very healthy overall returns.
Backed by Tangible Assets
Unlike many stock and bond investments, an Investor Partner’s ownership is secured by insured, tangible assets as collateral. They are not subject to the wide fluctuations of the stock market and can provide a steady return on investment, including income and appreciation even when the real estate market is flat or in a downturn.
Engineered for Success
A property’s economies of scale benefit the investors as much as the investments. The legal and tax advice of professionals are built into the group investment from its inception and protect the group continually. This is one of the most difficult factors for individual investors to replicate because the costs of retaining professional talent are beyond their resources. Moreover, investors benefit from a combination of specialized financing techniques, management’s business acumen, and operational expertise.
Controls and Safeguards
SIG’s Real Estate Investments are governed by stringent investment safeguards. A Private Placement Memorandum sets out the group investment’s distribution policy, prohibits investment in certain assets or activities, defines borrowing limitations and limits recourse of its lenders and major service providers to the assets of the group investment—thereby protecting the investors from liability. Additionally, financial statements are audited frequently to ensure accuracy in financial reporting. This assures that Investor Partners receive unbiased information and thus, an added layer of security.
It is well known that an investment’s staying power is the single most important factor to building wealth. Yet the need for operating cash is often overlooked when inexperienced investors buy real estate. Group investments assure that sufficient capital is available to give the investment the ability to withstand economic downturns or temporary shortfalls.
Ownership of real estate by way of a private group investment does more than bring stability to an investor’s portfolio. It also relieves stress! Because the returns are based on the properties’ actual revenues, rather than the ups and downs of the speculative markets, members in a private syndication don’t have to check their computer or the daily paper to see how their investments are doing.
Self Directed IRA -Registered Retirement Savings Plan Eligibility
Private syndications are 100% eligible as US content for registered portfolios that allow you to put the stabilizing, revenue-generating, and appreciating benefits of real estate ownership to work for you through a SELF-DIRECTED IRA. A self-directed IRA is no different from any other IRA. “Self-directed” means that you choose the investments thereby providing you with the benefit of more choices and more flexibility for your retirement savings. Investing in real estate through a self-directed IRA can be the key to perpetuating wealth across generations.
Please request more information via our contact page to be mailed a free self-directed IRA informational kit or to speak with an advisor.