The Single Property Structure:
Each property will be purchased with a single purpose entity, (i.e. REI Partners I, LLC; the type of investment entity will be referred to as “limited liability partnerships” for tax purposes), and interests will be offered exclusively through word of mouth. The property to be purchased will be identified in advance. Properties will be purchased with modest leverage approx. 65% LTV, and all Net Operating Income, less prudent reserves, will be distributed to investors on a monthly basis.
The Sponsor Organization “REI Equity Management, LLC” a Connecticut LLC, will be the managing partner in each of the limited liability partnerships to be formed. REI Equity Management, LLC. will only draw 2% of the distributed cash flow in fees, until and unless the investors have achieved the promised average annual preferred return. Currently 8%.
Each partnership will do business primarily with REI Advisors Group affiliated entities, all at standard market rates and all fully disclosed. These will include, but will not be limited to, real estate brokerage, mortgage brokerage and property management. Initially, the primary benefit and compensation to the REI Organization will be realized through these affiliate entities performing services for the partnerships, so there will be no front-end load to the investors.
Equity interests in this and subsequent limited liability partnerships will be offered to “Non-accredited” and “accredited” investors, as such term is defined in Regulation D promulgated under the Securities Act of 1933.
Total Transparency System
In the current market turmoil, it is sometimes difficult to know who can be trusted with your investment dollars. REI has already started making investments in advanced information technology to enable Fund accountants, auditor’s and investors 24/7 online access to Each Property’s accounting records. Every investor in one or more of REI’s limited liability partnerships will be given remote access to our real estate management and accounting software (i.e. www.propertyware.com ), where you will be able to log on from your home computer and generate any number of financial reports and see all transactions for each property.
In the words of Ronald Reagan this will allow all of REI’s investors to “trust but verify”