Good morning BP! Happy Monday!!
I was wondering if anyone has had experience using REITs as a method to develop real estate.
I've been working on a project for tiny houses and have the opportunity to partner with a recently launched REIT. They have to hit a target dollar amount before they can lend but it certainly seems promising for the longer sustainability moving forward.
PM me if you'd like to know the specific REIT. they're predicting an 8% ROI and focus on projects that promise positive impact.
@Joe Callantine I have a friend who has partnered with a few different REITS for his projects. From what he has told me, the only issue he has had with them is that some have extensive due diligence processes which could potentially be frustrating of getting approval from them to fund. I guess it would be deal specific of when they are coming into a deal. However, could not think of a potentially better partner if they like your project since it is fellow real estate minded people.
Would love to find out more info as well. Seems very interesting.
Is the REIT taking an equity or debt position? REITs have been around for 50+ years, and especially publicly traded ones aren't known for being very flexible in how they operate. I've heard of non-traded REITs that have been more adventurous, but I've heard of many more that were just fee factories for sponsors.
The one I'm working with just launched and for now, they're taking a debt stance. They specifically told me my project will be the first they fund after they hit the goal. We've even started discussion on what the terms will look like.
It's fairly exciting of an opportunity to partner with them. Now, they just need to hit the goal.