What is a K-1?
Similar to a 1099, a K-1 form is an accounting of the tax income for the year. Each investor receives one per investment. K-1 forms are most commonly used in partnerships and in real estate ownership. You will receive your K-1 usually by the end of March.
What are some advantages of investing in multi-family property versus single family rental homes?
Apartments offer certain advantages over single family homes such as economies of scale and greater cash flow potential. Additionally, the more rental units you have in one location or under one roof, the less risk you have. Cash flow on an apartment building usually is greater than a single family home since you have more rent coming in.
How often should distributions be expected?
An investor can expect to receive monthly distributions from Beilke Investments. Investors should expect quarterly cash flow statements and updates on their project.
What could go wrong?
All investments have an element of risk. Some risks to consider: tenants move out, tenants don’t pay rent, interest rates increase, poor management, and external factors (environmental, economic, political) could impact the properties operating performance.
How will I be updated on the progress of my investment?
Investors can expect to receive monthly asset management updates via email. Investors will also receive a detailed investor report every quarter.
How do you finance the purchase of the complex?
Most acquisitions will be a combination of debt (mortgage) and cash.
What happens to my money when I fund an investment?
Funds can be wired directly into the subscription account of the fund, or sent by check.
Can I be guaranteed that I will get my initial investment back?
NO, any type of investing has an element of risk and there is a possibility that you may not receive your investment back. To mitigate risk with this type of investing, properties are selected in a real estate market that has the highest probability of generating strong cash flow, appreciation and returns to the investor.
What is the minimum investment?
$50,000 is the minimum to invest.
How many other investors are in the deal with me?
Each investment opportunity will have a different amount of investors in the deal. The fewer the better as most investors desire to have a higher proportion of cash flow and equity.
Can I invest through my LLC, LP, TRUST, or IRA?
Yes. Investors are able to invest through an LLC or trust. Investors are also able to invest through their traditional self-directed IRAs. Please contact a Beilke Investments team member if you need help selecting a custodian.
Will I be involved in the day-to-day management of the property?
NO, Beilke Investments will handle all day-to-day activity and you will not have any management responsibilities.
What are the fees?
Investors receive a 6% - 8% preferred return. Once investors preferred return is paid, Beilke Investments (General Partnership) receives 20% to 50% of the profits and investors (Limited Partner) receives 50% to 80% of profits. Additionally, Beilke Investments receives a monthly 1% - 3% asset management fee on invested capital, a 1% - 5% acquisition fee on purchase price and a 1% - 2% disposition fee will also be charged at sale of project. There is no fee to set up an account.
What is the structure of the deal?
Each property is placed into a single purpose partnership structure. A Limited Liability Company (LLC) is a common entity selection. The LLC will own the apartment complex.
Will I be asked to verify my status as an accredited investor?
Yes. Once you decide to invest in a property, you will be contacted by a CAMBE Capital with instructions on how to verify your accreditation. With an SEC Regulation D, 506 B subscription, Beilke Investments is not required to have your accreditation confirmed or verified. We are only obligated to supply you the investor a form that you the investor acknowledges that you are accredited.
What am I buying when I invest in your deals?
You are buying investment units in the LLC and the LLC owns the building.
Why do you have to follow the Securities and Exchange Commission (SEC) rules?
Any time money is pooled together from two or more investors with the expectation of making a profit and where the investors are not involved with management decisions, a security is created. Securities are regulated by the SEC.
How can I invest?
Offerings are available to accredited investors who register with Beilke Investments. Go to "Get Started" page to confirm your investment commitment.
Contact Beilke Investments for instructions on how to:
- Verify your accreditation
- Sign legal document (Private Placement Memorandum (PPM), Subscription Agreement, Operating Agreement)
- Fund your investment
What types of investors do you work with?
We help a group of accredited investors generate passive cash flow through real estate investing.
What is a PPM?
PPM stands for a private placement memorandum. It is a document that the investor
will review in great detail and outlines the specific investment opportunity. The PPM
presents the potential risks to the investor.
Am I able to cash my investment at any time?
No. By their nature, real estate investments have a longer term time horizon than that of liquid stocks or bonds. Beilke Investments projects typically schedule out for a 3, 5 or 7 year hold.
What are some of the tax issues that should be considered?
- You must consult with your own tax professional for specific tax advice.
- Some items to consider:
- Equity Partner will receive a Schedule K1 reporting the income or losses from the property.
- Equity Partner is allocated depreciation expense that is beneficial for tax purposes.
- Additional state tax returns could be required to file.