|Proprietary Product - Ontario Retail/Residential Limited Partnership (ORRLP)||Propriety Product - Virtus Real Estate Investment Trust (REIT)||Centurion Apartment Real Estate Investment Trust (REIT)|
ORRLP brochure, click here.
Watch the video summarizing this investment offering, click here.
Virtus REIT brochure, click here.
|Centurion REIT brochure, click here.|
|This product is available to Accredited Investors only.||This product is available to Accredited and Eligible Investors.||This product is available to Accredited and Eligible Investors.|
|Issuer website.||Issuer website.||Issuer website.|
You can invest in real estate in a number of ways. Traditional real estate investing involves buying a property, renting it out and collecting rent, or increasing the value through renovations, and then selling for a tidy profit.
Today, you can invest in real estate (both residential and commercial) without becoming a “landlord” through:
Real Estate Investment Trusts (REITs): They are similar to mutual funds in that they pool investors’ funds and use it to purchase an underlying asset. REIT funds are used to purchase and hold properties that produce income.
REITs can be private or public. Publicly-traded REITs are traded like stocks on the stock exchange (e.g. Toronto Stock Exchange), while private REITs are exempt investments which are not available publicly and an investor must qualify as “accredited” or “eligible” to purchase them. Private REIT unit prices are less volatile than public REITs and usually have a minimum investment requirement.
REITs distribute at least 90% of their taxable income to shareholders annually. Depending on the REIT, distributions may include income (taxed at your marginal tax rate), the return of capital (lowers the adjusted cost base of each REIT share you own), and foreign non-business income (taxed at your marginal tax rate).
When you dispose of your shares, you may make a capital gain (taxed at half your marginal tax rate).
Real estate investment trusts
A real estate investment trust (REIT) invests in income-producing real estate properties, such as shopping malls or multi-unit residential buildings. An investment in a REIT can offer investors income through payouts it receives from the properties it has invested in.
Investors can buy securities in public or private REITs. Public REITs are listed on a stock exchange and private REITs are traded in the exempt market. Buying and selling public REIT securities through an exchange is relatively straightforward, and its value is easily assessed through publicly- available prices. Private REITs are not listed on an exchange, making their securities more difficult to value and trade. Investing in a private REIT is different from and generally riskier than investing in a public REIT. There are also certain eligibility requirements that investors must meet before they can buy securities in a private REIT.
A real estate limited partnership (LP) is commonly used to develop a real estate property or to manage completed real estate properties, such as a condominium building. As an investor, you can buy securities in real estate LPs. Real estate LPs are governed by the terms of a limited partnership agreement, which may be complex. The LP is controlled by a general partner who manages the development of a real estate property. For example, the general partner may use money from investors to buy undeveloped land with the expectation of developing it or selling it at a profit. This gives investors the potential for growth if and when the land or development project goes up in value.
Most real estate LPs are private. Their securities are not listed on an exchange, making them difficult to trade and value.
You can buy a property as an investment and generate income through rental payments from a tenant, assuming that you charge enough rent to cover all costs associated with ownership, including any mortgages, taxes, utilities and maintenance.
Source: Ontario Securities Commission https://www.getsmarteraboutmoney.ca/
Virtus Capital Management Inc., Dealing Representative’s must assess eligibility & product suitability. For definitions on Eligible and Accredited investor qualifications, please visit: https://www.osc.gov.on.ca/en/SecuritiesLaw_31-103.htm
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