Alternative Investments

Alternative Investments by Design

Real Estate Funds

Smaller pool of investments targeted towards a specific asset type, location, or strategy.
Focus: Overall return

Energy

Investments in oil, natural gas, green energy, and surrounding industries.
Focus: Cash flow

REITs

Larger pool of investments with a broad focus, generally around an asset type.
Focus: Stable cash flow

Fixed Income

Investments aimed at providing a set income over a specific period of time.
Focus: Fixed cash flow

Private Equity

Investment in private businesses generally focused around a specific industry.
Focus: Overall return

Tax Strategies

Investments aimed at lowering tax liability.
Focus: Tax benefits

Benefits of Alternative Investments

STABILITY* AND DIVERSIFICATION

To mitigate market risk investors are turning to alternative investments in tangible assets such as real estate, energy, equipment leasing, private equity, and fixed income, amongst others. These alternative asset classes may offer stability* in an uncertain market to an otherwise traditional portfolio because they are not correlated to more volatile stocks and bonds and their values don’t tend to move in tandem with the market. In addition, there’s enough variety within alternatives to create a combination of investments into multiple asset classes that may provide you further diversification and stability in any market cycle. In fact, there is potential opportunity for you to profit in declining markets as you invest in assets with low or negative correlations to the market.

CASH FLOW AND APPRECIATION

Perhaps the greatest reason investors are looking to alternative solutions is because they want long-term stable cash flow and a strong potential for appreciation. As actual physical assets, such as an apartment building in Charlotte, a parking lot in Chicago, or an oil rig in Texas, each alternative investment is structured with a unique purpose and function and can offer you different benefits. For instance, some alternative offerings are designed with cash flow as the primary goal, while others are structured for long-term capital appreciation. However, the majority are intended to balance both income and growth. With the wide variety of asset classes and structures found in alternatives to choose from, it is possible to build a custom portfolio of alternative investments designed to meet your financial, retirement, and estate planning goals.

OPPORTUNITY

When you invest in alternatives you invest as part of a group and gain partial ownership of actual physical assets. This pooled investment structure allows the average investor access to bigger and potentially higher quality assets previously available only to the wealthy and institutional investor. For example, an individual accredited investor with $100,000 could possibly afford to buy one condo on their own, or by investing in alternatives could have the opportunity to buy into a national portfolio of apartments from professional sponsors with long-term experience in their industry.

TAX BENEFITS

Alternative investments may provide you substantial tax benefits in several ways. For those in a 1031 tax deferred exchange, alternatives such as TIC’s and DST’s can provide suitable replacement property to defer real estate capital gains tax. For those who are looking to lower their current tax bill, there are alternatives designed with immediate tax write-offs being the primary goal of the offering and others with tax-benefits as a by-product of the asset class they are in. And for those looking to shelter as much current income as possible, there are programs intended to shift current income to long-term capital gains1.

Risks of Alternative Investments

Like any investment, alternative investments have unique risks that should be carefully researched before investing. Thoroughly read the prospectus before investing. Alternative investments are not liquid and if there is a secondary market established for the product, they will most likely be at a significant discount. Most programs use moderate to high amounts of leverage which could compound loses if loses occur. Investors in the programs have no control over the sponsor. Alternative investments in real estate are subject to the risks of owning, operating and disposing of real estate and will be adversely effected by loss of occupancy, extensive capital improvement needs, inability to refinance, or poor market conditions. Alternative Investments may charge high upfront and/or ongoing fees requiring capital appreciation for a return of original investment. Investors could potentially lose some or all of their initial investment and should consult with their chosen professionals before investing.

Photograph Disclaimer: The property photographs shown are for illustrative purposes only and may or may not represent past or current properties in any of our offerings.