REM Capital - Robert Ritzenthaler - Thoughts?
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Member since 2022 · 29 posts · 19 votes
2yQuote from @Manshi M.:
Has anyone from this group invested with REM Capital? I am considering investing in one of their syndication projects in Texas. Since we have not worked with this group before, I am hoping to get some references.
I have and it has gone badly. Robert mixed funds among separate investment properties which has hurt the all of those properties. The one am in (in Atlanta) is in disrepair with many squatters. Robert has been removed from the project and Rod Khalif has been brought in as the "fixer." I hope he can salvage some of our money.
43 Replies
- Rental Property Investor · Havre de Grace, MD · Member since 2018 · 15 posts · 11 votes4mo
I was invested in City Park, and it was foreclosed on at the end of last year. Okay, I understand losing my original $100k investment — that part is painful enough. But my CPA just finished my taxes, and apparently because we used up the basis over the last four years through depreciation, and because my share of the foreclosed loan balance was $135k, that amount is showing on my K-1 as a "paper distribution," even though I never actually received any funds. I now have to pay long-term capital gains taxes on that $135k. That completely blows my mind. I'm staring at a very large tax bill with absolutely nothing to show for the investment itself.
Then today I got word that Avenue33 — another $100k investment — signed with a buyer. The lender is expected to lose around $18 million on this deal. There were five buyers who submitted offers. Four of them were willing to at least throw the equity investors a bone and keep us involved on the backend in some capacity. And which buyer did they go with? The fifth one — the one with the highest bid and no future involvement for any of the current partners.
What a disaster.
- Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes4mo
Quote from @Alison Evans:
I was invested in City Park, and it was foreclosed on at the end of last year. Okay, I understand losing my original $100k investment — that part is painful enough. But my CPA just finished my taxes, and apparently because we used up the basis over the last four years through depreciation, and because my share of the foreclosed loan balance was $135k, that amount is showing on my K-1 as a "paper distribution," even though I never actually received any funds. I now have to pay long-term capital gains taxes on that $135k. That completely blows my mind. I'm staring at a very large tax bill with absolutely nothing to show for the investment itself.
Then today I got word that Avenue33 — another $100k investment — signed with a buyer. The lender is expected to lose around $18 million on this deal. There were five buyers who submitted offers. Four of them were willing to at least throw the equity investors a bone and keep us involved on the backend in some capacity. And which buyer did they go with? The fifth one — the one with the highest bid and no future involvement for any of the current partners.
What a disaster.
Sorry to hear this. That is something that many also get kicked in the teeth on is when these sponsors take depreciation or accelerated depreciation / cost segregation and give people big savings early on, if the deal goes bad not only do they lose their investment but have to pay back the monies they had saved from the cost seg.
7e investments53 Reviews - 4moJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Chris Seveney:
Quote from @Alison Evans:
I was invested in City Park, and it was foreclosed on at the end of last year. Okay, I understand losing my original $100k investment — that part is painful enough. But my CPA just finished my taxes, and apparently because we used up the basis over the last four years through depreciation, and because my share of the foreclosed loan balance was $135k, that amount is showing on my K-1 as a "paper distribution," even though I never actually received any funds. I now have to pay long-term capital gains taxes on that $135k. That completely blows my mind. I'm staring at a very large tax bill with absolutely nothing to show for the investment itself.
Then today I got word that Avenue33 — another $100k investment — signed with a buyer. The lender is expected to lose around $18 million on this deal. There were five buyers who submitted offers. Four of them were willing to at least throw the equity investors a bone and keep us involved on the backend in some capacity. And which buyer did they go with? The fifth one — the one with the highest bid and no future involvement for any of the current partners.
What a disaster.
Sorry to hear this. That is something that many also get kicked in the teeth on is when these sponsors take depreciation or accelerated depreciation / cost segregation and give people big savings early on, if the deal goes bad not only do they lose their investment but have to pay back the monies they had saved from the cost seg.
one of the major benefits of a fund like yours U know exactly your return as long as the collateral performs. in a water landing you dont add insult to injury, I am 97% sure most investors have no clue about recapture though being sophisticated accredited investors they should right ? - Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes4mo
Quote from @Alison Evans:
I was invested in City Park, and it was foreclosed on at the end of last year. Okay, I understand losing my original $100k investment — that part is painful enough. But my CPA just finished my taxes, and apparently because we used up the basis over the last four years through depreciation, and because my share of the foreclosed loan balance was $135k, that amount is showing on my K-1 as a "paper distribution," even though I never actually received any funds. I now have to pay long-term capital gains taxes on that $135k. That completely blows my mind. I'm staring at a very large tax bill with absolutely nothing to show for the investment itself.
Then today I got word that Avenue33 — another $100k investment — signed with a buyer. The lender is expected to lose around $18 million on this deal. There were five buyers who submitted offers. Four of them were willing to at least throw the equity investors a bone and keep us involved on the backend in some capacity. And which buyer did they go with? The fifth one — the one with the highest bid and no future involvement for any of the current partners.
What a disaster.
Wow. That really sucks. Sorry to hear that for you that you are going to lose about a quarter million when it's all said and done. That's painful.
Skyline Properties - Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes4moI think the bar for accredited is just too low. I don't necessarily believe we should run around saving people from themselves but we have financial and federal oversight organizations for a reason - it's not good for society in general to allow people to lose large sums of money they may not be able to easily replace. I can't honestly say advanced depreciation strategy is something that would even cross my mind in a REIT type investment as a limited partner.
Quote from @Jay Hinrichs:
Quote from @Chris Seveney:
Quote from @Alison Evans:
I was invested in City Park, and it was foreclosed on at the end of last year. Okay, I understand losing my original $100k investment — that part is painful enough. But my CPA just finished my taxes, and apparently because we used up the basis over the last four years through depreciation, and because my share of the foreclosed loan balance was $135k, that amount is showing on my K-1 as a "paper distribution," even though I never actually received any funds. I now have to pay long-term capital gains taxes on that $135k. That completely blows my mind. I'm staring at a very large tax bill with absolutely nothing to show for the investment itself.
Then today I got word that Avenue33 — another $100k investment — signed with a buyer. The lender is expected to lose around $18 million on this deal. There were five buyers who submitted offers. Four of them were willing to at least throw the equity investors a bone and keep us involved on the backend in some capacity. And which buyer did they go with? The fifth one — the one with the highest bid and no future involvement for any of the current partners.
What a disaster.
Sorry to hear this. That is something that many also get kicked in the teeth on is when these sponsors take depreciation or accelerated depreciation / cost segregation and give people big savings early on, if the deal goes bad not only do they lose their investment but have to pay back the monies they had saved from the cost seg.
one of the major benefits of a fund like yours U know exactly your return as long as the collateral performs. in a water landing you dont add insult to injury, I am 97% sure most investors have no clue about recapture though being sophisticated accredited investors they should right ?Skyline Properties - 4moJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @JD Martin:
I think the bar for accredited is just too low. I don't necessarily believe we should run around saving people from themselves but we have financial and federal oversight organizations for a reason - it's not good for society in general to allow people to lose large sums of money they may not be able to easily replace. I can't honestly say advanced depreciation strategy is something that would even cross my mind in a REIT type investment as a limited partner.Quote from @Jay Hinrichs:
Quote from @Chris Seveney:
Quote from @Alison Evans:
I was invested in City Park, and it was foreclosed on at the end of last year. Okay, I understand losing my original $100k investment — that part is painful enough. But my CPA just finished my taxes, and apparently because we used up the basis over the last four years through depreciation, and because my share of the foreclosed loan balance was $135k, that amount is showing on my K-1 as a "paper distribution," even though I never actually received any funds. I now have to pay long-term capital gains taxes on that $135k. That completely blows my mind. I'm staring at a very large tax bill with absolutely nothing to show for the investment itself.
Then today I got word that Avenue33 — another $100k investment — signed with a buyer. The lender is expected to lose around $18 million on this deal. There were five buyers who submitted offers. Four of them were willing to at least throw the equity investors a bone and keep us involved on the backend in some capacity. And which buyer did they go with? The fifth one — the one with the highest bid and no future involvement for any of the current partners.
What a disaster.
Sorry to hear this. That is something that many also get kicked in the teeth on is when these sponsors take depreciation or accelerated depreciation / cost segregation and give people big savings early on, if the deal goes bad not only do they lose their investment but have to pay back the monies they had saved from the cost seg.
one of the major benefits of a fund like yours U know exactly your return as long as the collateral performs. in a water landing you dont add insult to injury, I am 97% sure most investors have no clue about recapture though being sophisticated accredited investors they should right ?
the syndicators do sell it hard when raising money .. I suspect the recapture is buried in the fine print.. When I bought my First Cirrus for 450k in 04 brand new. I got to write off 400k day one LOL.. I was so excited about the write off but come 2011 when things crashed and I had to sell her recapture was a beotch but lucky or not lucky I had such massive loss's in those days it did not really affect me.. U do get on the recapture hamster wheel once you start to do that. One should really talk through a syndication of apartments or commercial thoroughly with a knowledgeable CPA
- Rental Property Investor · Havre de Grace, MD · Member since 2018 · 15 posts · 11 votes4mo
I should have been more specific. I knew about the depreciation recapture on my 100k. That is basic. I did not know I could lose my entire investment and owe taxes on more than what I put in it. Even though it's only an extra $35k that taxes are due on...it's insult to injury.
- Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes4mo
Dam wow thats awful, I cannot imagine losing six figures and owing taxes after too. I prefer just buy properties myself, so am in full control. Almost did some passive syndications in past am glad skipped out on them.
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