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REAL ESTATE EDUCATION

For Investors Looking at Deals Online

ADVANCED REAL ESTATE CONCEPTS

Real Estate Waterfall Outliers

June 4, 2019

The Outliers of the Real Estate Waterfall World By Adam Gower Ph.D. When investing in a real estate project as a passive partner, cash distributions are calculated and made using what is called a ‘waterfall,’ most of which are structured according to reasonably uniform standards, and some of which are more creative.   According to…

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Sponsor Fees and the Motivating Factor in Real Estate Investing

April 28, 2019

Sponsor Fees and the Motivating Factor in Real Estate Investing By Adam Gower Ph.D. When looking at any real estate deal with a sponsor, understanding the principals’ motivation for why they are doing a particular transaction is a key consideration prudent investors should keep in mind. The best sponsors will be able to articulate clearly…

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Unwrapping Assumptions in Real Estate Analysis

April 19, 2019

Unwrapping Assumptions in Real Estate Analysis By Adam Gower Ph.D. The Promise of High Returns   It is easy for investors to be seduced by the promise of high returns on a real estate deal and while there is nothing wrong, of course, with wanting a high return it’s important for investors to understand what…

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Aspects for Evaluating a Sponsor

April 9, 2019

Aspects for Evaluating a Sponsor By Adam Gower Ph.D. Investing in an average real estate deal with a great sponsor instead of a great real estate deal with an average sponsor can be a wise investment decision. As the sponsor has such an impact on the trajectory of how the real estate is going to…

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3 Risks to Watch for in a Real Estate Recap

March 13, 2019

3 Risks to Watch for in a Real Estate Recap By Adam Gower Ph.D. A recapitalization of a project occurs when a sponsor refinances a project they already own, oftentimes bringing in new investors to provide additional equity. An obvious advantage to this scenario is the mitigation of risk that comes from the sponsor’s legacy…

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Understanding Real Estate Recapitalizations vs. Acquisitions

March 12, 2019

Understanding Recaps vs. Acquisitions in Real Estate By Adam Gower Ph.D. When a sponsor offers an opportunity to investors, the property they wish to finance will either have just been acquired (or is under contract) or was purchased by the sponsor at an earlier time using a different financial structure than the one being proposed.…

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What You Need to Know About Rent Control

March 5, 2019

The Unintended Consequences of Rent Control By Adam Gower Ph.D. Oregon just became the first state in the union to impose rent control statewide, yet an entirely predictable unintended consequence is that driving down single-family home values is also a likely result.   Communities across the United States are grappling with the question of how…

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House Price Dynamics

March 2, 2019

How to Recognize a Housing Bubble By Adam Gower Ph.D. Past performance is not a guarantee for future results. This boilerplate disclaimer is standard wording for just about any financial investment we might make, but when it comes to buying a home it is often disregarded. Home-buyers tend to be driven by the idea that…

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What is a REIT?

February 10, 2019

What is a REIT? By Adam Gower Ph.D. A common question that arises when investors first discover the option of investing in syndications via online crowdfunding websites is how they differ from Real Estate Investment Trusts, or REITs. One of the best comparisons to a REIT is a mutual fund; specifically, an equity mutual fund.…

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A Starter Guide on Preferred Equity

February 10, 2019

A Starter Guide on Preferred Equity By Adam Gower Ph.D. Preferred equity is one of those financial concepts that a lot of investors believe they understand, and yet each may have a different concept in mind which can lead to confusion and misunderstanding. This article provides guidance on the definition of preferred equity, and how…

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