Investments include a mix of high-quality brick and mortar locations such as medical offices and retail properties. Forget the crystal balls; we aim for robust portfolios built on solid historical foundations with an eye towards the future.
PIT isn’t a Silicon Valley startup trying to make a quick buck. We’re real estate people with over 85 combined years of real estate experience between us. It’s just what we do. We’ve got real skin in the game–we invest 20% of all funds raised up to $10 million. When you win, we win. And we like winning.
The days of barriers to real estate investing are gone. Let us be your partner as you take the first step to building your portfolio. Try us out and see how easy investing in real estate can be.
There’s a lot of information out there about different approaches to successful real estate investing. We believe that success is a direct result of a disciplined approach backed by experience navigating today’s real estate markets. Property Income Trust relies on diversity within our investments to achieve exceptional results and stay relatively insulated from specific risks. Medical office and prime retail locations form the backbone of our strategy, creating long term gains that will help you on your path towards financial security.
Property Income Trust is aiming to make real estate investing affordable and accessible for everyone. We know that making an investment in real estate in a big step in securing wealth and security for your future and we want to work with you every step of the way. Our founders have worked with some of the wealthiest families in the country; it’s time for you to join them and make your investment work for you. You want somebody who knows real estate inside and out and sees you as a partner, not just an account number. We’re Property Income Trust, and we’re honored to work with you.
We are a newly organized Delaware limited liability company which will invest in and manage a diversified portfolio of commercial real estate assets. The use of the terms “Property Income Trust”, the “Company”, “we”, “us” or “our” in this Offering Circular refer to Property Income Trust LLC unless the context indicates otherwise.
We are externally managed by our Manager, PIT Manager LLC. Our Manager will make all of our investment decisions unilaterally (see the “Management” section starting on page for details).
Mascia Development LLC, a New York Limited Liability Company, is our “Sponsor” and an affiliate of our Manager (see the “Overview Of Our Sponsor” starting on page for details).
Subject to the Company’s performance and having sufficient cash flow, the Manager intends to pay distributions to all Investors on a monthly basis in arrears commencing in the first full month after the month in which we make our first real estate-related investment.
Our goal is to provide a professionally managed, diversified portfolio of high-quality commercial real estate assets to investors who generally have had limited access to such investments in the past. Allocating some portion of your portfolio to a direct investment in high-quality commercial real estate assets may provide you with:
On top of the aforementioned reasons to invest in commercial real estate there are also some strong benefits to investing specifically in medical office properties. Some of the benefits are described now. Thanks to the aging baby boomers, there is a long-term demographic trend toward an aging population and higher medical spending per capita, all favoring the healthcare industry growth. The Affordable Care Act is further expected to increase medical spending among consumers nationwide not just the aging population. Medical professionals as office users are historically less likely to change locations than other office users, because of the substantial capital investments required in facilities and equipment, which makes them stable attractive long-term tenants. Higher predictability of returns due to long-term nature of leases and tenant responsibility for most operating costs and opportunity for growth in cash flow and valuation due to contractual rent increases.
Again, retail properties benefit from all of the commercial real estate investment benefits described above, but retail properties specifically have some additional benefits described here. We believe the fear among other real estate investors that internet retailers such as Amazon.com and the like, will “kill brick-and-mortar retailers” is overblown/oversold.
Our investment strategy is based on a “contrarian” or “value” investment thesis, meaning we typically invest counter to the common market sentiment to achieve maximum value.
This is not meant to be an exhaustive list of differences between a REIT and our Series A Investor Shares, but merely a highlight of the main differences. For further details, please consult your investment and tax advisor.
Investors in a real estate LLC usually hope that the pass-through entity will have sufficient depreciation, interest expense, and other deductions to shelter the cash flow from the property and keep a majority of the distribution tax deferred until sale. These shelters might permit the Investors to receive a return similar to a tax-exempt bond – except that real estate returns have historically been substantially higher compared to tax-exempt bonds because of the additional risk associated with real estate. REITS are not fully able to take advantage of these benefits to the extent that LLCs are. There can be no guarantee this will continue or that we will be able to take full advantage of this but it is true as of the date of this Offering Circular and we plan to attempt to continue achieving similar results.
A further difference between our Series A Investor Shares and a public REIT is the daily liquidity available with a publicly listed REIT. Although we have adopted a redemption policy (see the “Redemption Policy” section starting on page for further detail) that attempts to allow investors to redeem Series A Investor Shares on an annual basis, we do not have nearly the same liquidity as a fully public company. We also hope to have our Series A Investor Shares listed on the OTCQX market after the Company has issued $50,000,000 of Series A Investor Shares (see the “Transfers” section starting on page ), but there is no guarantee we will be successful in doing so. Therefore, for investors with a short-term investment horizon, a listed REIT is likely a better alternative than investing in our illiquid Series A Investor Shares. Valuations of a listed REIT are also more transparent and established than the valuation of our Series A Investor Shares. However, we believe our Series A Investor Shares will have lower correlation to the general stock market than listed REITs.
As of the date of this Offering Circular, the overall listed-REIT sector has recently been trading near all-time highs, with the Investor Series A Investor Shares version of the Vanguard REIT Index Fund (ticker: VGSIX, a mutual fund comprised of 153 public REIT stocks and requiring a $3,000 minimum investment) is yielding generally less than 3.0% after expenses, over the last few years. We believe such pricing suggests that a substantial portion of the price of listed REITs is attributable to a built-in liquidity premium, as recent unlevered capitalization rates on real estate transactions in the private sector have averaged 5.35% – 7.15%, according to a recent “Real Estate Investor Survey” report published by PWC from Q4 2015. Additionally, public REITs are subject to more demanding public disclosure and corporate governance requirements than we will be subject to. While we are subject to the scaled reporting requirements of Regulation A, such periodic reports are substantially less than what would be required for a public REIT.
The primary difference is that we neither charge nor do we intend to pay any broker-dealer distribution fees, which represents a savings to Investors of approximately 70% to 90% in upfront expenses as compared to a traditional non-exchange traded REIT.
We are one of only a few real estate investment companies available to both accredited and non-accredited investors offered directly over the internet. Currently, online investment platforms typically offer individual property investments as private placements to accredited investors only.
Yes. Our Manager and/or its affiliates shall make a combined equity investment in an expected amount of 20% of the total Series A Investor Shares outstanding, up to a maximum of $10,000,000 at the initial $25 per Share price. The money will be invested over time to match the 20% of total Series A Investor Shares outstanding until a maximum $10,000,000 has been invested. This investment will represent a significant portion of the net worth of the CEO and COO of our Sponsor, helping to ensure alignment of interests between management and Investors.
An investment in our Series A Investor Shares may be beneficial for you if you seek to diversify your investment portfolio with some commercial real estate, seek to receive current income, seek to preserve capital and are able to hold your investment for a long term time period consistent with our liquidity strategy. On the other hand, we caution persons who require immediate liquidity or guaranteed income, or who seek a short-term investment, to consider that an investment in our Series A Investor Shares will not meet those needs.
The historical data support one conclusion with unusual force: To invest with success, you must be a long-term investor.
It takes 20 years to build a reputation and five minutes to ruin it.
Observation over many years has taught us that the chief losses to investors come from the purchase of low-quality securities at times of favorable business conditions.
Investment success accrues not so much to the brilliant as to the disciplined.
To buy when others are despondently selling and sell when others are greedily buying requires the greatest fortitude and pays the greatest reward.
Your ultimate success or failure will depend on your ability to ignore the worries of the world long enough to allow your investments to succeed.
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