Investment Structure

Blackacre offers investors two real estate investment options; A) a pooled-asset Real Estate Investment Fund (REIF) and B) an ever-expanding portfolio of Syndicated Limited Partnerships (SLP). These options are designed to cater to the diverse interests and risk appetites of our investors. It's crucial for prospective investors to thoroughly evaluate each option, as each presents its own distinct advantages and disadvantages outlined below:

A) Real Estate Investment Fund (REIF) Model

Blackacre assembles its REIFs on a wide range of proprietary criteria. Simply put, different individual properties are chosen based on factors like regional proximity to each other, asset class, economies of scale in management, and stability status. This ‘pooling’ of properties ensures effective risk mitigation across the collection. The REIF model allows investors to spread their risk across a carefully curated portfolio of properties, as opposed to having their entire investment in one property.

  • Logistically, REIF investors own a share (%) of a dedicated holding company. In turn, that holding company owns the actual properties placed in the REIF. Blackacre REIFs vary in size and usually have 3-7 properties, and as many as 20 or more investors/owners.

    • Diversification: Blackacre’s REIFs typically invest in a diversified portfolio of properties, hedging against the inherent risk of owning only a single investment property.

    • Professional Management: Our REIFs are managed by experienced professionals who handle property selection, acquisition, and management, to ensure the best possible stability of the properties.

    • Accessibility: Our REIFs offer access to real estate investments to smaller or newer investors without the need for significant capital or the hassle of direct property ownership.

    • Liquidity: If a Blackacre investor should need to make a redemption, which has never happened, investors can access their capital with a new investor buying their position, which can include the other partners.

    • Passive Income: Our REIFs can provide regular income distributions from cash flow generated by the properties in the portfolio.

    • Fees: Blackacre’s REIFs are managed on a fee basis. The fees we charge the partnership are based upon the value of the properties within the REIF at the time of acquisition, disposition, and during the life of the investment, these fees being an alternative to an equity split offered in the .

    • Limited Control: Investors in our REIFs have limited control over property selection and management decisions.

    • Blended Performance: While our professional management team works diligently to enhance the performance of our REIF investments, there is no guarantee of success. If one of the properties within the REIF underperforms it may work to offset the better performing properties within the same REIF.

  • Blackacre has one of the most competitive and interest-aligned fee structures:

    • 1% property acquisition, or fund creation;

    • 1% annual asset under management (AUM) fee;

    • 1% property disposition, or fund wind-down; and

    • 25% performance fee of added value at the disposition of any property, or fund wind-down.

    Other fees:

    • $1,500 legal fee for new investors

    • 5% early redemption fee

    • REIF investors must be Accredited Investors

    • Blackacre REIF minimum investments start at $50,000

    • New investors are billed a one-time legal fee of $1,500

B) Syndicated Limited Partnerships

Blackacre provides opportunities for property-specific syndication investments. These investments entail a limited partnership structure, typically in the form of a limited liability company (LLC), which holds ownership of a single property. Blackacre, acting through an affiliate, assumes the role of managing member of the LLC, also known as the General Partner (GP), while investors participate as non-managing members, known as Limited Partners (LP). As the managing member, and for its efforts in establishing the partnership, Blackacre receives its equity stake in the property upon acquisition. This syndication model enables investors to focus their investment on a single property with more potential upside than a fund model.

  • Syndication investors (LPs) own a share (%) of the actual LLC which owns the investment property. Blackacre earns a share of syndicated equity for forming the partnership, sourcing the property, and organizing the investors. Our syndications vary in size and usually have 1 property, and as many as 5 or more LPs.

    • Access to Larger Properties: Blackacre syndications connect investors to pool their resources with other investors to acquire larger and often times more lucrative properties that are usually out of reach individually.

    • Diversification: Investors can diversify their real estate holdings by participating in multiple syndication deals, spreading their risk across different properties and markets.

    • Professional Management: Blackacre syndications are managed by our in house experienced real estate professionals who handle property selection, acquisition, and management.

    • Passive Investment: Syndication allows investors to participate in real estate ownership without the responsibilities of active management, such as property maintenance and tenant management. Blackacre handles it all for its LP investors.

    • Potential for Higher Returns: By leveraging Blackacre’s expertise and experience, and investing in larger properties, investors have the potential to achieve higher returns compared to individual real estate investments.

    • Concentration: Concentration of an investor’s money in a single property carries higher risk because if the chosen asset performs poorly, the investor's entire portfolio may suffer. However, this also offers the potential for higher returns if the selected asset performs well.

    • Lack of Control: Investors in real estate syndications have limited control over property selection, management decisions, and exit strategies. However, investors relying on Blackacre's expertise and informed decisions shields them from dangerous risks.

    • Illiquidity: Blackacre’s syndications are typically illiquid, with limited opportunities for investors to sell their ownership interests before the end of the investment term. In rare situations, we do allow for an early redemption but there is a 5% redemption fee plus legal costs.

    • Market Risks: As with all real estate, Blackacre’s syndicated properties are subject to market fluctuations and economic conditions, which can impact property values and investment performance.

  • Blackacre has one of the most competitive and interest-aligned fee structures:

    • 1% property acquisition;

    • 1% annual asset under management (AUM) fee;

    • 1% property disposition; and

      [ Either ]

    • 25% performance fee of added value upon disposition of the property, or

    • 25% equity upon acquisition.

    Other fees:

    • $1,500 legal fee for new investors

    • 5% early redemption fee

    • REIF investors must be Accredited Investors

    • Blackacre REIF minimum investments start at $50,000

    • New investors are billed a one-time legal fee of $1,500