All Forum Posts by: Tyler Smith

Hi All, 

We have a small/growing portfolio (10ish units, some flips) and I recently had to take over insurance responsibility.

We had started coverage with NREIG on a couple properties - reading a lot of mixed reviews on BP and elsewhere about those guys. Contacted a local agent who recommended Cincinnati Financial for coverage. Looks like rates will be a bit higher vs. NREIG but have heard good things about the company in general. 

Know insurance recommendations are tough (everyone has a horror story about everyone) but wondering if anyone has any advice in this area before I continue to expand with NREIG. 

Thanks! 

Hi All, 

Currently raising money for a residential real estate fund (flips and rentals) and a potential investor asked about investing via funds held in a trust.  I don't think there should be an issue with this but don't have a lot of experience in the area.  I would imagine we'd just need to get the trust officer to sign off on the subscription docs and move the money. 

Has anyone dealt with this kind of situation before?

Thanks!

Hi All, 

I recently started a real estate investment company (50/50 ownership between me and my business partner) and am getting ready to launch the first fund.  

A few of my investors have inquired about investing via self-direct IRA, so we will likely make that an option. Upon hearing about this, my dad (who was going to invest anyways) thought this sounded like an interesting option. However, it looks like this would be in conflict with the "disqualified persons" rules (since I own 50% of the holding company).

I was wondering if there are any workarounds for this specific case. My dad has other financial resources to invest but using IRA funds would be the most logical and convenient. Since he will be treated like any other investor in the fund, and is simply looking at this as a good investment opportunity, it seems as if this rule is somewhat overly restrictive.

I will definitely engage my accountant on this but thought it would be worth checking if the BP community had any insights. 

Thanks!  
 

Hi All,

My partner and I are looking to launch a private real estate fund (raising money from 10-15 individual investors).  Our plan is to use the pooled funds to invest in a combination of flips and longer-term MF rental properties.  We have engaged an attorney but I am looking to learn as much as possible before we get into the weeds with him. 

There are a million things I'm still trying to figure out but, at the highest level, I'm trying to get my head around the most logical structure for the fund.  Namely, open-end vs. closed-end.

Our vision is to build a portfolio of longer-term rental properties to provide stable cash flow and supplement those with shorter-term flips.  We'd like the flexibility to hold onto attractive rentals for the long term, while also having the ability to continuously reinvest the proceeds from flips.  We'd also like the ability to replace investors (should one want to cash out) to avoid forced asset sales.

I understand the closed-end structure is far more common for real estate funds but various characteristics (e.g., set termination date, defined investment period, inability to change/add investors, inability to re-invest precedes from flips, etc.) seem to conflict with our goals.

Open-end funds seem to address many of these concerns but it seems like there is a much greater level of complexity that comes with that structure. 

Curious if anyone has experience in this area or has dealt with a similar situation. 

Thanks!