What were your 2019 returns?
We aren’t able to provide performance for the REIT since it’s a new product and we haven’t closed the fund yet. We are still in the fundraising phase of the fund. All assets in the fund are newly purchased or in the renovation phase, therefore we haven’t realized full returns on any of them. Current returns are only from cash flows from the existing REIT properties, which are reinvested for growth.
How does a fund work?
First, you raise money, then you purchase assets according to the fund’s investment criteria/strategy, then you sell and realize returns.
Right now, returns are based on cash flow from existing properties. Because the fund is new, we are still currently raising capital and are not done purchasing properties.
As we raise more, acquire more, renovate, and increase cash flow, the asset disposition process starts (toward the end of the fund’s term). This is when we will see returns realized according to the strategy.
Can I liquidate my investment?
Like all real estate investments, your investment in the DiversyFund Growth REIT should be viewed as a long-term (approximately 5 years) investment. To protect the growth of all our investors’ wealth there are no premature withdrawals.
How do I earn returns on my investment?
DiversyFund buys underperforming multifamily assets, renovates them and stabilizes the asset. Once the property is stabilized the cash flows are collected and disbursed to the Fund. The cash flow is then divided up amongst the investors on a per rata basis. At the end of a 5 year period, the properties are sold, disbursed to the fund and then divided up amongst the investors. Investors can choose to reinvest into DiversyFund’s next fund or take a full payout.
What is the Growth REIT’s investment strategy?
The current focus of the DiversyFund Growth REIT is on multifamily value-add properties. DiversyFund carefully qualifies each investment opportunity to ensure that specific criteria are met. By ensuring the market is right, as well as a number of other factors, our team of experts can hand-select the opportunities that show the best potential return on investment for you.
What happens during the Growth REIT’s 5-year term?
We aim to invest in projects that can be liquidated (i.e., sold) within approximately five years. We maintain several cash-flowing properties in the portfolio, generating revenue from rents. When market conditions are suitable to an advantageous liquidation event, we sell the assets at which point investors will receive their principal and returns back. We also provide a prorated adjustment on the return based on how long someone was in the Fund to compensate those who have been in the longest.
What is the term?
The DiversyFund Growth REIT is designed to be a long-term investment and is inherently illiquid in nature. It has a 5-year projected term.
What documents do I receive as an investor?
After completing your investments, you can track updates on your dashboard. Within the dashboard, you will be able to see your current investments, periodic asset updates, and tax documents.
As long as you are an investor, we intend to furnish you with a Form 1099.
What is the Growth REIT?
The DiversyFund Growth REIT is a diversified portfolio of value-add multifamily real estate properties that allow everyday investors to build wealth like the 1%. Our investors are co-owners and investment partners with us and own a percentage of the REIT’s commercial real estate portfolio.