FREQUENTLY ASKED QUESTIONS
Why real estate?
No other investment activity in history has created more wealth and security than real estate. That's because it's a relatively stable asset in a fixed location that can be leveraged to produce income in various ways. Investing in stocks is risky, returns are unpredictable, and despite huge gains, it can all be lost overnight. With real estate, you always have collateral that protects your investment. This gives you several exit options in the event that things don't go as expected. Stocks offer no such security. Unfortunately, most people can't take advantage of the benefits of real estate investing because they don't know where to start, and they don't know anyone to help. Luckily, now you do. ;)
What is the minimum investment to participate in the fund?
Texas residents can participate with just $5,000.
How is my investment secured?
As a participant in the fund, your investment is secured with a proportionate ownership interest in the fund. The fund then secures its investments with a lien on the underlying property that gets recorded in the county records. There is also at least 20% of additional equity in the property to control for any sudden changes in market value or project costs, and to provide for multiple exit strategies. We also hold a performance deed to each property in escrow as an added measure of security.
What kind of due diligence is performed on the underlying projects?
First, we analyze each project to ensure that it makes sense from a profit standpoint ("would we do this project ourselves?"). This regularly includes supporting documentation including appraisals, sales comps, and repair estimates. We then conduct a title search to ensure that our lien position is solid and that there are no other judgments or liens. We also make sure that there is enough equity in the project to provide a healthy margin to account for market and price point changes. We also devise multiple exit strategies that can be executed in the event of non-performance.
What is my involvement?
You make a one-time investment to the fund and sign some paperwork securing your interest in the fund. That's it. From there, you'll receive monthly account statements and be invited to quarterly investor meetings. There are no contractors to manage, no toilets to fix, and no tenants to chase. We take care of everything to make this investment as passive as possible.
Can I invest using my 401K or IRA?
Absolutely. If you have not already self-directed your accounts, we can connect you with experts who can get you set up. This allows you to select your own investments like real estate, rather than just relying on a faceless fund manager who makes money even if you don't.
Are these projects owned by Urban Lazarus?
Most of the time, no. We assist projects owned and managed by others by participating as an equity partner in the deal. We fund a portion of the project costs in exchange for project equity. We get a note, a lien, and then we monitor these deals on behalf of the fund and our investors. Occasionally, we will be the project owner as opportunities arise (because we are first and foremost real estate investors), but whether it be our project or one of our partners, all investments are structured and managed with the same utmost transparency, diligence, and scrutiny.