Frequently Asked Questions
Why Invest in Real Estate?
Better Returns Than The Stock Market
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The average stock market return over the last 15 years was just over 7%. However, the actual return was just 2.5% once fees, taxes, and inflation were included.
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Real estate syndications routinely yield average annual returns of 10-15% (after fees). The returns are taxed at a much lower rate (if at all), making a great hedge against inflation.
What are the Advantages of Investing in Real Estate?
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Tax Advantages – Real estate offers tax advantages over other investments (e.g., stocks, bonds, and precious metals). Our passive investors can benefit from legal tax avoidance and deferment methods encouraged by the U.S. tax code, including depreciation, 1031 Exchanges, and tax-free cash-out refinances.
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Cash Flow and Appreciation – Most of our projects are value-add opportunities that allow us to increase our potential for successful exits. While we hold properties, we intend to maximize revenue and minimize expenses to produce the most significant ROI for our passive investors.
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Diversification and Risk Aversion – Over the last few decades, commercial real estate has proven less volatile than the stock market. With increasing inflation, we trust that commercial real estate is a hedge against the unknown.
What is a Real Estate Syndication?
A real estate syndication is where a group of people pool their resources to purchase real estate – often a large property like a shopping center – which would otherwise be difficult or impossible to achieve.
Who is Involved in a Syndication?
A real estate syndication typically involves the “general partners” who organize the syndication, find the property, secure financing and manage the property. The general partners are sometimes called “sponsors” or “operators.”
The people who provide the cash investment are often called “passive investors” or “limited partners.” In return for their investment, the limited partners receive an equity share in the syndication along with cash flow.
Who Can Invest
Hogan Douglas investments are appropriate for accredited or non-accredited passive investors.​
For an individual to qualify as an accredited investor, they must accomplish at least one of the following:
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Earn an individual income of more than $200,000 per year, or a joint income of $300,000, in each of the last two years and expect to maintain the same level of income reasonably.
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Have a net worth exceeding $1 million, either individually or jointly with their spouse.
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Be a general partner, executive officer, director, or a related combination thereof for the issuer of a security being offered.
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An entity is considered an accredited investor if it is a private business development company or an organization with assets exceeding $5 million.
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An employee benefit plan or a trust can qualify as an accredited investor if total assets are more than $5 million.
Do the Principals Invest Their Own Money into the Deal?
Yes, Hogan Douglas strives to build wealth alongside its passive investors. As a sponsor, Hogan Douglas will invest in every deal.
How Much Do I Need to Invest?
We typically calculate the minimum investment requirement on a deal-by-deal basis. However, we often accept investments for as little as $50,000.
How Do I Get Paid?
You will receive distributions monthly or quarterly via checks or ACH payments directly to your bank account.
When Do I Get Paid?
Most of our investment opportunities are projected to cash flow within the first quarter once the acquisition stage is complete.
What Type of Investment Returns Should I Expect to Receive?
The returns can vary depending on the project you are investing in. Hogan Douglas typically provides passive investors with a preferred return in the range of 6-10% for a stabilized, income-producing property. This gives investors a likely outcome of outperforming the market with a more significant upside when selling the property.
What Proof of Ownership Do I Receive after I Invest?
Every passive investor completes a legally binding subscription document countersigned by the principals of Hogan Douglas. You will also receive a K-1 statement during tax season every year, and you also are provided access to our online portal for tracking your investments and distributions.
What Are the Risks?
Direct or indirect real estate property purchases involve significant risk, including loss of value. In deciding whether to invest in a Hogan Douglas investment opportunity, prospective investors should read the entire Operating Agreement and associated Risk Disclosures. Before making any investment decision, potential investors should consult an investment advisor, accountant, and attorney.