Altigo serves to streamline alternative investments, turning a lengthy and manual transaction process into a quick, accurate, and pleasant one. However, “alternative investments” is a broad term and some advisors may not be familiar with the myriad offering types available across the industry. Many alternative investments fall under the category of real estate.
Although the platform is not limited to real estate investments, currently, Altigo can help advisors automate investments into 3 popular real estate offering types: 1031 Exchange DSTs, Opportunity Zone Funds, and Non-Traded REITs.
1031 Exchange DSTs
Delaware Statutory Trusts allow multiple investors to pool funds into co-ownership of a property. Properties are professionally managed by a sponsor, relieving investors of the responsibility of finding tenants and maintaining the properties. DSTs are eligible for 1031 exchanges, which offer investors an opportunity to roll proceeds from one property into another while deferring capital gains tax. This can allow investors to grow their portfolio and invest in larger properties over time. Learn more about the risks and advantages of 1031 exchanges here.
Opportunity Zone Funds
A qualified opportunity zone fund is an investment vehicle which uses proceeds to invest in property or businesses located within an opportunity zone — an economically distressed area or community designated by the state in which it resides and certified by the US Department of the Treasury. Investment into an opportunity zone fund can provide investors with significant tax advantages, including tax deferral, tax basis step up, and even elimination of taxes on appreciation, depending on how long the investment is held. Learn more about the risks and advantages of opportunity zone funds here.
A Real Estate Investment Trust is a tax-advantaged investment vehicle that has the potential to generate risk adjusted returns primarily through rental income, but also through the appreciation of held real estate assets. REITs are required to return 90 percent of earnings to investors in the form of dividends. While some REITs are traded on public exchanges like NYSE and NASDAQ, non-traded REITs are sold by individual brokers. Unlike DSTs and opportunity zone funds, non-traded REITs are available to the public, with no accreditation limitations. Learn more about the risks and advantages of non-traded REITs here.
Real estate investments such as, DSTs, opportunity zones funds, and non-traded REITs, are subject to substantial risks, including illiquidity, vacancies, general economic conditions, competition, potential adverse tax consequences, and the potential loss of invested capital. Diversification does not guarantee profits or protect against losses.
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Disclaimer: WealthForge provides this information for educational purposes only. It should not be construed or relied upon as legal or tax advice.