Tulsa Real Estate Fund
Miami, FL · Member since 2018 · 41 posts · 13 votes
Hi, I’m new to the Bigger Pockets Forum so I apologize if I posted this incorrectly.
I was wondering if anyone heard about the Tulsa Real Estate Fund spearheaded by Jay Morrison.
He’s trying to raise $50 million in a syndication deal to develop properties in urban areas. The minimum investment is $500 and you do not have to be an accredited investment.
Here is the link http://www.tulsarealestatefund.com/
I would love any thoughts about this deal. Good opportunity, stay away. Invest small, any insight would be nice.
Thank you.
@Ian Ippolito - I wrote Tulsa Real Estate Fund. Yes, 5.5 is higher than normal, but the fund isn't taking any other fees other than that fee - no acquisition, no disposition, no asset management, no refinance - nothing.
@Calvin Lipscomb access to information is the difference. Established credibility and financial history is the difference. You can't honestly tell me that there is more transparency in a startup fund than a multi-billion dollar multi-national, publically traded company. Furthermore, GE is certainly a convenient selection to articulate your point. While GE is down 50% YoY, the S&P500 is up 12% which is a much better assessment of the market than GE. To select GE would be like me selecting Boeing, which is up 90% YoY. I do agree with you in that I am fortunate to have access to doing things others are not capable of, like taking risks and investing in funds like these. That's why I encouraged people with as little as $500 to invest it in the stock market or bonds instead. All the information they need can be found online.
If I was starting to invest and all I had was $500, I would put it in a low-cost total-market index fund. But now that my CORE portfolio is up and running (fully funded), I'm looking at funding my EXPLORE portfolio.
Investing in an alternative asset class for $500 is a low entry cost. Other Reg A+ funds I've invested in so far have a $1,000 minimum. Reg A+ funds are reviewed by the SEC, which doesn't make them guaranteed or safe, but at least they meet some minimum standard of disclosure. Many Reg A+ funds I've watched have gone through multiple reviews with the SEC before they are finally approved for investing by the general public.
This is a fund aimed at combating gentrification its dedicated and named after Tulsa because that is the location of the First Black Wall Street which was unfortunately destroyed by mass bombing with over 250 killed due to racism and bigotry! Now on to the company they are SEC regulated I believe Tier 2 or something to that affect $500 is the minimum. They are social impact and plan to invest in areas affected heavily by gentrification I am thinking of investing myself, For me much better than putting in a bank they are guaranteeing 8% plus 50% of profits amongst shareholders: This is crowdfunding private money.
I have no expertise in urban planning, but I have respect for the field because one of my college roommates was an architecture major and I got to overhear his dormitory conversations.
Reg A+ offerings are reviewed by the SEC. Reg CF offerings have to go through a crowdfunding portal that is regulated by FINRA.
http://www.finra.org/about/funding-portals-we-regulate
Two Reg CF portals that fight gentrification while improving the neighborhood are Buy the Block and Small Change.
I've invested in an offering on Small Change that is currently in its funding phase. Buy the Block and the Tulsa Fund are on my short list. Whenever I invest in these unproven ventures, I toe-dip by investing the minimum amount (money I can afford to lose even though I don't want to lose it).
@Calvin Lipscomb access to information is the difference. Established credibility and financial history is the difference. You can't honestly tell me that there is more transparency in a startup fund than a multi-billion dollar multi-national, publically traded company. Furthermore, GE is certainly a convenient selection to articulate your point. While GE is down 50% YoY, the S&P500 is up 12% which is a much better assessment of the market than GE. To select GE would be like me selecting Boeing, which is up 90% YoY. I do agree with you in that I am fortunate to have access to doing things others are not capable of, like taking risks and investing in funds like these. That's why I encouraged people with as little as $500 to invest it in the stock market or bonds instead. All the information they need can be found online.
It is not about convenience. I used GE specifically because it is down dramatically. Just to point out that companies can take a beating. What was the history of Apple, IBM, MSN when they first launched? Has Uber ever made a profit. How long was it before Tesla turned a profit? Next, what is the fundamental difference between this fund and what many people do on a smaller level. Everything has risk. For the record I am not promoting or knocking down this offering. I corrected a point about fees mentioned by the attorney for the fund in this thread.
I think it's very disingenuous to name a fund after a place but not have ANY intention of investing in that place. To me that's just an attempt to capitalize on Tulsa's unfortunate history.
Add in the obfuscation of the way the "manager" gets paid and I'm out. No way José are they getting a dime of this Tulsan's money.
Jillian Sidoti how much are each of the founding members like Jay Morrison are investing?
Believe jay said he put $10,000 into it (200 shares)
Do you think that is enough?
Jillian Sidoti how much are each of the founding members like Jay Morrison are investing?
Believe jay said he put $10,000 into it (200 shares)
Do you think that is enough?
Not really. Not gonna lie; I did do so in a kind of emotional action. I wanted to be a part of it.
Removed.
@Jillian Sidoti In your experience, is the one flat fee more common in the crowdfunding offerings than the traditional Reg D space? I know the Reg A+ have only been around since 2015 so there my not be the largest sample size, but I'm curious if you have seen any trends in the structure that differentiate crowdfunding from transnational syndication, other than the obvious required ones.
Removed.
Why did you remove the financial information you had posted?
I don't want to say too much. I really don't. I shouldn't answer investor questions and I want people to read the offering circular before investing - not taking my word for it on a message board.
I don't want to say too much. I really don't. I shouldn't answer investor questions and I want people to read the offering circular before investing - not taking my word for it on a message board.
For somebody not wanting to answer investor questions you do seem to be quite actively participating here Ms. Sidoti. What is your goal here by posting so much?
I always post on Bigger Pockets. I am constantly offering advice. I just don't want to seem like I am offering investment advice. I don't know why that is offensive to you. I want people to make their own judgments on this and read the documents. Me copying and pasting from the documents is not providing the investor a full picture.
I did, however, want to clear up some misconceptions - which I think I have done (i.e. the 5.5% fee and the 8% preferred is NOT a guarantee.)
I think it's very disingenuous to name a fund after a place but not have ANY intention of investing in that place. To me that's just an attempt to capitalize on Tulsa's unfortunate history.
Add in the obfuscation of the way the "manager" gets paid and I'm out. No way José are they getting a dime of this Tulsan's money.
I think you missed the cultural meaning behind the name 'Tulsa' (google 'Black Wallstreet'). The point is not to invest and rebuild Tulsa. The point is to rebuild what 'Black wallstreet' stood for. This can be done in any urban market throughout the US.
I don't want to say too much. I really don't. I shouldn't answer investor questions and I want people to read the offering circular before investing - not taking my word for it on a message board.
I want to thank you for posting on this thread. Your presence provides a "real person feel" to the official paperwork. I also understand the need for investors to rely solely on the paperwork (and their own common sense) when making the decision whether to invest or not.
When I sold my home on the West coast, my realtor didn't want me around when she was showing the home, nor did she want me to contact the buyers and their agent directly. All communication had to go through my agent. The reason is that her lawyers wanted the buyers to rely on the paperwork I had to fill out and sign when I prepared my home for sale. The worry was that if I talked to the buyers directly, they would rely on my word rather than the paperwork. If I had failed to remember something correctly and there was a lawsuit, the situation could get messy.
@Jillian Sidoti In your experience, is the one flat fee more common in the crowdfunding offerings than the traditional Reg D space? I know the Reg A+ have only been around since 2015 so there my not be the largest sample size, but I'm curious if you have seen any trends in the structure that differentiate crowdfunding from transnational syndication, other than the obvious required ones.
Apologies for not being clear. I meant the single relatively high (5.5% in this case) fee, instead of the smaller collection of fees ( acquisition fee, PM Fee, Asset Management fee, disposition fee)
Is that still dealers choice or is it more common in the crowdfunding space in your experience?
I think it's very disingenuous to name a fund after a place but not have ANY intention of investing in that place. To me that's just an attempt to capitalize on Tulsa's unfortunate history.
Add in the obfuscation of the way the "manager" gets paid and I'm out. No way José are they getting a dime of this Tulsan's money.
I think you missed the cultural meaning behind the name 'Tulsa' (google 'Black Wallstreet'). The point is not to invest and rebuild Tulsa. The point is to rebuild what 'Black wallstreet' stood for. This can be done in any urban market throughout the US.
Having been here all my life, I'm well aware of Tulsa's history. I think YOU are missing the rich culture that Tulsa offers today. From the Reconciliation Park to the Jazz hall of fame. There are tangible examples of how Tulsa is much more than what happened in 1921.
Why not call the fund "Black Wallstreet" to more accurately reflect it's goals?
I think it's very disingenuous to name a fund after a place but not have ANY intention of investing in that place. To me that's just an attempt to capitalize on Tulsa's unfortunate history.
Add in the obfuscation of the way the "manager" gets paid and I'm out. No way José are they getting a dime of this Tulsan's money.
I think you missed the cultural meaning behind the name 'Tulsa' (google 'Black Wallstreet'). The point is not to invest and rebuild Tulsa. The point is to rebuild what 'Black wallstreet' stood for. This can be done in any urban market throughout the US.
I believe the broader picture is to encourage African American entrepreneurship.
In some communities, a dollar spent in the community remains around for a few weeks. In African American communities, a dollar spent remains there on average for only a few hours.
@Bill F. - if I am bring honest, I see more fees like this:
| Description | Frequency | Basis for Fee | When Earned | Amount |
| Expense Reimbursement | On startup and incidentally thereafter | Payment of documented out-of-pocket expenses paid by the Manager or its members on behalf of the Company. | Startup reimbursements due on breaking of impounds, or incidentally thereafter. | Indeterminate. |
| Acquisition Fee | One-time Fee | Compensation for efforts of the Manager in organizing the Company, conducting due diligence on the Property, procuring the acquisition loan, and making this investment opportunity available to Investors. | On Breaking Impounds or as funds are raised thereafter. | Approximately between 2%-5% of the purchase price of the Property. |
| Asset Management Fee | Recurring, monthly Fee | To be paid to the Manager for the management of the Property. | During Property operations. | 2.0% of the total monthly revenue collected from the Property. |
| Property Management Fee | Recurring, monthly Fee | To be paid to a third-party Property Manager, who will provide Property Management services. The Property Manager may be an Affiliate of the Company. | During Property operations. | 4.0% of gross collected income from the Property. |
| Brokerage Fee | Upon the sale and purchase of the Property. | To be paid to members of the Manager or its affiliates as a traditional brokerage fee for performing all listing and sales duties. | Upon the close of the sale and purchase of the Property. | 3% of the purchase price of the Property.[1] |
| Refinance Fee | Fee paid at the time of a refinance. | Compensation to the Manager for its efforts in securing a refinance loan on the Property. | On the refinance of the Property. | 1.0% of the new loan amount, or other negotiated amount. |
| Disposition Fee | One-time Fee | Compensation to the Manager for its efforts in disposing of the Property. | On the sale or disposition of the Property. | 1.0% of the sale price at the time the Property is sold. |
| Interest on Deferred Fees or Manager Advances | Monthly | The Manager may earn Interest on any deferred Fees, Manager Advances, or unreimbursed expenses that are not paid when incurred or due. | Starts on date Fee earned for duration of deferment. | Up to a 10% annual rate of interest on the deferred Fee or reimbursement, if any. |
[1] A third-party broker will typically charge 2% to sell an asset of this size and quality. An affiliate of the Company who is a licensed real estate broker will be participating in a commission of an additional one percent (1%) of the total purchase price of the Property (Brokerage # ).
I think it's very disingenuous to name a fund after a place but not have ANY intention of investing in that place. To me that's just an attempt to capitalize on Tulsa's unfortunate history.
Add in the obfuscation of the way the "manager" gets paid and I'm out. No way José are they getting a dime of this Tulsan's money.
I think you missed the cultural meaning behind the name 'Tulsa' (google 'Black Wallstreet'). The point is not to invest and rebuild Tulsa. The point is to rebuild what 'Black wallstreet' stood for. This can be done in any urban market throughout the US.
Having been here all my life, I'm well aware of Tulsa's history. I think YOU are missing the rich culture that Tulsa offers today. From the Reconciliation Park to the Jazz hall of fame. There are tangible examples of how Tulsa is much more than what happened in 1921.
Why not call the fund "Black Wallstreet" to more accurately reflect it's goals?
Didn't miss it James because from my understanding, the rich culture of Tulsa today is not the reason why they named the fund what they did.
My point is that the organizers are very clear why they named it "Tulsa". And it was not to be "disingenuous".
You'll have to contact them as to why they didn't name it "Black Wallstreet".
I suppose my point is predominately black North Tulsa especially is in need of capital infusion and investment.
We'll just have to agree to disagree on my opinion of their marketing tactics.
I think it's very disingenuous to name a fund after a place but not have ANY intention of investing in that place. To me that's just an attempt to capitalize on Tulsa's unfortunate history.
Add in the obfuscation of the way the "manager" gets paid and I'm out. No way José are they getting a dime of this Tulsan's money.
I think you missed the cultural meaning behind the name 'Tulsa' (google 'Black Wallstreet'). The point is not to invest and rebuild Tulsa. The point is to rebuild what 'Black wallstreet' stood for. This can be done in any urban market throughout the US.
I believe the broader picture is to encourage African American entrepreneurship.
In some communities, a dollar spent in the community remains around for a few weeks. In African American communities, a dollar spent remains there on average for only a few hours.
Good article and thank you. Yes according to fund organizers Jay Morrison and Andre Hatchett, that is the broader picture indeed. Wealth creation and an effective tool against gentrification are also among the main goals of the fund.
Impact investing is a hot category right now in the investing world ("do well by doing good").
With low-minimum crowdfunding sites, I can toe-dip to get a feel for whether I want to add more money down the road. My strategic reason for doing so is to diversify my portfolio beyond global publicly-traded businesses.
For example, I have a small amount of money invested on CNote, which pays a 2.5% return from lending money to CDFIs (https://www.cdfifund.gov/), and Calvert Impact Capital, which pays me a 1% return on my investment.
I use a donor-advised fund to make anonymous donations to local 501(c)(3) charities because I live in the area and want to "invest" in the quality-of-life of my community. With a DAF, my financial return comes from the deduction for charitable donations on my tax return.
Wow, this sounds great... Do most institutions have DAF services/products?
Wow, this sounds great... Do most institutions have DAF services/products?
There are over 200,000 donor-advised funds in the United States, but the big three are Fidelity Charitable, Schwab Charitable, and Vanguard Charitable.
https://www.nytimes.com/2015/11/08/giving/retiree-giving-becomes-a-force-of-philanthropy.html
The PBS show Wealthtrack had an episode about donor-advised funds last year.
I always post on Bigger Pockets. I am constantly offering advice. I just don't want to seem like I am offering investment advice. I don't know why that is offensive to you. I want people to make their own judgments on this and read the documents. Me copying and pasting from the documents is not providing the investor a full picture.
I did, however, want to clear up some misconceptions - which I think I have done (i.e. the 5.5% fee and the 8% preferred is NOT a guarantee.)
I'm certainly not offended. I was curious that's all. Posting information then deleting it drew some concern from me, but I'm new around here. Perhaps that's how all the lawyers post, IDK.
Please don't mistake my opinion of this fund offering as a personal attack on you, that's kind of silly isn't it? We all have our jobs to do.
Please don't mistake my opinion of this fund offering as a personal attack on you, that's kind of silly isn't it? We all have our jobs to do.
I definitely do not. If I thought every judgment my clients went through was a personal attack...well, I would be very shell-shocked right now.
I just want you to understand, why, on this thread, my answers are short and somewhat cold - seeming almost incomplete.