A 2023 Update on My Passive Real Estate Investment Returns

CEO Khai Intela
In my investing career, I have made numerous real estate investments of varying sizes, types, and with a wide range of returns. This article provides an update on my passive real estate investments, both completed...

In my investing career, I have made numerous real estate investments of varying sizes, types, and with a wide range of returns. This article provides an update on my passive real estate investments, both completed and ongoing, and highlights the returns and time invested for 2023.

Why So Many Real Estate Investments?

You may wonder why I have made so many real estate investments. Firstly, I wanted to gain firsthand experience by investing small sums of money. There's no better way to learn how these investments work than by becoming an investor yourself with a small portion of your portfolio.

Additionally, as an SEO specialist and copywriter, I have had advertising or referral relationships with many of the platforms I've invested with. If I am recommending these platforms to others, I should be comfortable investing with them myself.

Diversification is another reason. In the world of crowdfunded real estate, there is no longstanding giant like Vanguard in the stock market. The industry is relatively new, and diversifying across different platforms can help spread the risk.

Lastly, my comfort level with real estate investing has grown over time. I started small and gradually increased my investments as I became more familiar with the different options and platforms available.

Ongoing Deals

Fundrise

One of my ongoing investments is with Fundrise, where I have been invested since January 2018. Fundrise offers eREITs, a collection of various real estate investments. I have chosen to take my distributions in cash, which are paid quarterly. Fundrise also updates the Net Asset Value (NAV) of their holdings, allowing investors to track their investment's growth over time.

fundrise_allocation Image: Allocation of my investment with Fundrise.

My investment with Fundrise has achieved an internal rate of return (IRR) of nearly 11% over five years, which is at the top end of what was projected for this diversified multifamily portfolio.

RealtyMogul

Since April 2018, I have been invested in RealtyMogul's MogulREIT II. This investment aims to provide capital appreciation and regular income. I receive quarterly distributions, and the Net Asset Value (NAV) is regularly updated.

realty_mogul Image: An overview of my investment with RealtyMogul.

The NAV of RealtyMogul's MogulREIT II took a hit during the COVID-19 pandemic but has since recovered. The annualized return is currently around 8.7%, and I have decided to withdraw my investment in 2023.

AcreTrader

Agriculture has always been close to my heart, which is why I invested in AcreTrader. I own a small portion of a row crop farm in Arkansas, and I've been receiving annual distributions based on rental income. AcreTrader aims to hold the property for 5 to 10 years, with the intent to sell at an advantageous time.

acretrader_farm Image: A glimpse of the row crop farm I invested in via AcreTrader.

AcreTrader has had several investments go full circle, performing significantly better than projected. While I cannot estimate my total return until the property is sold, updates on the productivity of the acreage have been positive.

DiversyFund

DiversyFund offers the Diversyfund Growth REIT, in which I invested in July 2019 with just $500. This fund aims to match their historic performance of an IRR in the 16% to 18% range over a five-year hold period. Currently, there is no liquidity option during the five-year hold period.

diversyfund_growth_reit Image: My investment with DiversyFund's Growth REIT.

While I cannot estimate my total return without an updated NAV, I received my first cash distribution of more than 18% of my initial investment, and previous dividends have been reinvested.

Medium-Sized Deals

Crowdstreet

I have made two investments with Crowdstreet, a platform with a wide range of deal options. They offer real estate funds, individual syndicated equity deals, and more. Crowdstreet is one of the most active platforms in terms of deal flow.

crowdstreet_deals Image: Overview of Crowdstreet's deal offerings.

As of early 2023, Crowdstreet investors have funded 580 deals. My investments with Crowdstreet are in ground-up builds in Texas, both with projected IRRs above 20%. These investments are expected to be fully realized in 2023 to 2024.

Big Deals

Origin Investments

Origin Investments is a trusted platform that has had three funds go full circle with an average IRR of 27.3% over 25 realized deals. I have been invested in the IncomePlus Fund since September 2020, which aims to provide tax-neutral distributions and additional capital appreciation.

origin_investments Image: My investment with Origin Investments.

Origin Investments updates the NAV per share monthly, giving me a good idea of my total return to date.

SFR3 via Republic Real Estate

SFR3 is a fund that purchases and renovates distressed homes for rental workforce housing. This investment provides a passive way to profit from single-family home purchases without getting directly involved in the day-to-day management.

republic_re_boeing Image: Example of a property remodeled and sold through Republic Real Estate.

I made this investment via Republic Real Estate, and it has provided returns in the upper teens. The reported return does not include an increase in market value, which is only updated during cash-out refinances.

Completed Deals

Alpha Investing

I made my first investment with Alpha Investing in July 2019. This low five-figure investment involved an apartment complex in Arizona. The property was sold in December 2020, providing outstanding returns.

Republic Real Estate Deal #1 and #2

Republic Real Estate offered two investments that have gone full circle. The first was an equity deal for a luxury Miami condominium, which I sold for a nearly 9% return. The second was a loan for a fix-and-flip project in Los Angeles, providing a return of 27.5% in just 7 months.

EquityMultiple

EquityMultiple was one of my first investments in passive real estate, made in January 2018. This value-add apartment complex project in Connecticut experienced delays due to COVID-19. While I made money, the returns were not as significant as anticipated.

PeerStreet

I also invested with PeerStreet in January 2018, making a short-term debt deal for a project in Palm City, Florida. This investment provided monthly interest payments and returned my capital with a final interest payment.

DLP Capital Partners via CityVest

I invested in the DLP Lending Fund via a CityVest access fund in April 2019. This investment provided quarterly dividends until it was liquidated in November 2022.

RealtyShares

RealtyShares was another investment I made in January 2018, involving a short-term debt deal for a quadplex in Albuquerque, New Mexico. While RealtyShares no longer exists, my investment went full circle, providing a return of nearly 3%.

Vanguard REIT Index Fund (VGSLX)

My first passive real estate investment was in the Vanguard REIT index fund, which I held from July 2013 until August 2021. The total return over eight years was approximately 107.62%, with returns in the high single digits.

My Take on Passive Real Estate Investments

Passive real estate investments have played a significant role in my portfolio, providing diversification and attractive returns. I started small with eREITs and gradually expanded my investments as I gained knowledge and confidence.

I believe educating oneself about the different platforms and options is crucial. While passive real estate investments are not without risk, they have the potential to generate substantial wealth. My goal is to continue growing my investments in this space to approximately 20% of my portfolio.

Remember, always do your due diligence and consider consulting with professionals regarding any investment decisions. Real estate investments are optional, and there are no one-size-fits-all approaches. Find what works best for you and your financial goals.

Note: This article is based on the personal experiences and opinions of the author. Past performance is not indicative of future results.

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