Create Passive Income
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Sit back, relax, and receive quarterly cash flow payments from your passive investments.
Our Buying Criteria
Nationwide growth markets
C to B class multi-family properties
Prefer B class in A market and C+ class in B market opportunities
Will review distressed C class deals in markets with populations over
Minimum 25+ units
$1 – $10 Million USD purchase price
Minimum 7% CAP rate
Prefer stabilized properties with minimum 85% occupancy
Will consider lower occupancy if property is well located and has value-add upside
Potential high yield income streams
20% below replacement cost
Cash equity – “all cash” or “Cash to existing debt”
Value-add opportunities sought
All investment returns vary based on the individual property.
Minimum $25,000 investment (some opportunities higher)
5-7 year hold period
WHAT IS AN ACCREDITED AND SOPHISTICATED/NON-ACCREDITED INVESTOR
“An accredited investor, in the context of a natural person, includes anyone who:
earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and reasonably expects the same for the current year, OR
has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence).
There are other categories of accredited investors, including the following, which may be relevant to you:
any trust, with total assets in excess of $5 million, not formed specifically to purchase the subject securities, whose purchase is directed by a sophisticated person, or
any entity in which all of the equity owners are accredited investors.
In this context, a sophisticated person means the person must have, or the company or private fund offering the securities reasonably believes that this person has, sufficient knowledge and experience in financial and business matters to evaluate the merits and risks of the prospective investment.”
Can I invest even if I am not accredited?
If you are non-accredited and would like to learn more about our investment projects, please fill out our investor application and we will contact you when we have non-accredited opportunities.
How do I get started?
You can get started as an investor with Ginkgo Holdings by completing an online investor application here.
What kind of properties do you invest in?
We currently solely invest in multi-family apartment buildings, one of the most recession proof segments of the Real Estate Market, particularly with the United States population continuing to grow. Even with the continued advancements in online marketing (particularly Amazon) and “work from home” which threatens the retail and office markets, people will always need to live somewhere. Within this segment, we focus on B+ to C+ class multi-family properties and prefer B class in A markets and C+ class in B markets. We believe this positions us in the segment of the market that is shielded most from the ups and downs in the economic cycles. We will also review distressed A class deals in markets with 1MM+ populations.
How does Ginkgo Holdings find apartment deals?
We have relationships with the vast majority of all commercial brokers in the Central and Eastern US, who bring us deals often before they go on the open market. We also occasionally engage in direct marketing campaigns and are constantly building relationships with banks to get access to their REO inventory. Once presented with an opportunity our team then underwrites every single property to the highest standards and eliminates those that do not qualify at our rigorous standards. As an example last year our team underwrote 726 properties and with only a little over 20 qualifying for our stringent standards.
How are Ginkgo Holdings apartment deals structured?
You will be limitied liability owner of the property which comes with all the benefits like depreciation and cash flow, meaning the property is owned by a “Property LLC” for which that property is the only asset (reduces liability). You in turn will be a direct shareholder in this Property LLC so in essence you are part owner of the company that owns the property. This allows for a direct flow-through of cash flow, depreciation, and allows you upon sale of the asset to realize long term capital gains … PLUS, you literally get to tell your friends you “own” an apartment complex, because you do.
How much are the properties leveraged?
This is an exciting point. Over a 5-year period it is our goal to have our properties not be more than 50-60% leveraged. While we start out with a 75%-80% leverage based on purchase price, we decrease that ratio rapidly by actively paying down the loan and by forcing appreciation of the property through value add improvements, superior management, and rent increases, leading to a 5-year loan to value ratio of no more than 60%. This conservative approach provides additional buffer from the ups and downs of the real estate market.
Can I invest with my retirement plan?
Yes, investing in Multi-family in a structure like ours is perfect for retirement plan investing because your involvement is by definition passive. All you need to do, if you haven’t already, is set up a SELF-DIRECTED IRA with an independent custodian, like Diredted IRA, Specialized IRA Services, or Vantage IRA, and once that is done you can invest using your IRA/401K/ROTH-IRA… or several other self-directed retirement account forms.
What will my return on investment be?
All our investment and Private Placement Memorandums are based on individual properties, and every property is different and will therefore offer different returns.
Our returns typically consist of two parts:
Preferred Return from Cash Flow:Each investment is selected such that it pays an minimum average annual preferred return of at least 6% (depending on the individual property deal this could be higher than that) which is paid out quarterly via direct deposit into your bank account or by check. In other words, the investors get paid first before the sponsors get paid anything. This protects you as an investor and makes sure we only pick projects that have strong cash flow outlooks.
Profit Share/Back End Profit: Upon a Sale or Refinancing of the property it is our goal to return 100% of the initial invested amount to each investor, and then do a profit split between sponsors and investors.
Can I invest if I am new to real estate investing?
Yes! We’re here to guide you and can provide educational resources that will help you confidently make smarter investing choices.
What is the difference between this and a REIT?
When you invest in a real estate syndication, you are investing directly in a specific property. Together with the other limited partner investors and general partners, you will own the entity (usually an LLC) that holds the asset. Thus, you have direct ownership.
When you invest in an apartment REIT, that REIT will likely own and manage a lot of apartment buildings in multiple markets across the country. With a real estate syndication, you are investing in a single property in a single market.
With a REIT, you can invest a very small amount of money, just like a stock. Syndications typically have higher minimum investments, often $50,000 or higher.
When you invest directly in a property through a real estate syndication, you get the benefit of a variety of tax deductions, including depreciation. In some case those tax benefits can be quite substantial. The depreciation benefits often surpass the cash flow, so you’re showing a loss on paper while you’re actually getting positive cash flow. Further, you can use those paper losses to offset your other income, like income from your job.
When you invest in a REIT, because you’re investing in the company and not directly in the real estate, you do get the benefits of depreciation, but those are factored in before you get your dividends, so you don’t get any tax breaks on top of that, and you can’t use that depreciation to offset any of your other income. Andany dividends are taxed as ordinary income, which can contribute to a bigger, rather than smaller, tax bill.
When should I expect my first distribution?
Are You Ready To Invest Smarter And Make Your Investments Work Harder For You?
Schedule a call to discover how we can help you enjoy passive real estate income without the stress and hassles of ownership!