General questions about real estate investing and the Wisco team.
While we always encourage investors to speak directly with a tax professional, there are definitely tax benefits to real estate investing. Depreciation, long term capital gains, and tax-free refinancing are three key advantages that are difficult to find elsewhere.
We wouldn’t say real estate investing is “better” than the stock market, but it’s certainly a different asset class that moves in different cycles than stocks. Real estate is an essential part of a diversified portfolio, offers many tax advantages that stocks do not, especially compared to regular trading of stocks, and is fully secured by a performing asset. A portfolio that consists solely of stocks and bonds is missing out on a secure, tried and true, tax-advantaged, and high yielding asset class if it doesn’t include any real estate investments.
With any investment comes risk. Wisco does everything in its power to ensure that the projects we underwrite are places we would put money into ourselves (and in fact, we always do). We turn down most projects that cross our desk, and we make offers that are not accepted frequently. This is a good thing. We believe fully in the concept of “making your money at the beginning”, meaning if we don’t have a financial model that shows us a path to a great return, we won’t purchase the property from the offset. This approach ensures we aren’t gambling or speculating on the broader market, but rather the mechanics of the project itself that we can control. We believe this approach gives investors a lot of security when choosing to invest with us.
In fact, we wouldn’t have it any other way. We ensure that all investors have contact with and access to our founders, and that the founders have a strong understanding of the investment objectives of any investor before we take their money.
We believe in making real estate investing accessible to anyone. The founders have all made money through real estate themselves, both actively and passively, and see it as a way to create income streams that lead to financial freedom. The returns are tax advantaged. The wealth builds and compounds. And as an investment, we believe there are many aspects of it we can control (as opposed to say investing in stocks where we have no ability to control the decisions of the company). Believing the above, we want to bring this investment class to others so they can benefit from the financial rewards we’ve uncovered in real estate ourselves.
Discover the synergy of expertise and capital, where sponsors transform visions into reality while investors earn great passive returns.
Syndication is a fundraising mechanism with two key parties: the sponsor and the limited investor. The sponsor is the person or team that finds the property, determines it makes financial sense to purchase and operate the property, and takes an active role in doing so. The limited investor invests money into the project passively, with no active role. They receive updates and earn a return on their investment. Syndication is a helpful tool for project sponsors to raise large sums of money they do not have themselves, sharing a portion of the project profits with investors in exchange for the use of their capital.
Each deal is different, but Wisco generally asks investors to commit a minimum of $50,000 to a syndicated deal. At this number, we find the absolute dollar returns start to make the most sense to investors, as well as somewhat minimizing the number of limited investors in a project. (We truly appreciate our investors, but also recognize the logistical overhead to manage a project increases with the number of investors).
This is very project dependent, but generally you can expect this structure. The first few years, we are generally rehabbing, constructing, or working to increase rents of the subject property. For most projects, we won’t be returning capital while this is happening. We call this phase “re-positioning” the property. Once the property is re-positioned, it enters a “stabilized” phase. Once the property is stabilized, we usually do a cash-out refinance, where we can return a substantial amount, all, or sometimes much more than an investor originally invested. Again, this is project dependent. Then, the property cash flows and the investor can expect regular distributions. Philosophically, we don’t like to sell properties as we want to take the cash flow from all the work we’ve put in. Thus, while investors usually are repaid all their invested capital within a number of years, the property is still owned and paying distributions for many years thereafter.
This is also very project dependent, but we generally won’t underwrite a property unless we feel that conservatively we can bring double digit returns to investors.
Absolutely not. Once you’ve spoken with a member of our team, to invest in a project you will fill out a subscription agreement, accredited investor form, W9, and sign an operating agreement. Then, you wire or ACH funds into the project’s bank account, and leave the rest to us. Each quarter, you’ll receive an update on how the project is going, and you’ll learn about your quarterly distribution. At tax time, you’ll receive a K-1 to send to your accountant (or enter into software if you do your taxes yourself). It’s fairly straightforward.
Fill out the contact form on our site, and someone will reach out to you promptly to introduce ourselves and learn more about what you’re looking for.
For investors, it’s an opportunity to diversify portfolios and generate consistent, attractive returns, secured by real estate.
Private money lending, also known as private lending or hard money lending, is a financial arrangement where individuals or private entities lend money to borrowers in exchange for a predetermined interest rate, typically secured by collateral, such as real estate. Unlike traditional loans from banks or credit unions, private money lending involves individuals or private investors acting as the lender instead of a financial institution.
Private money loans are often asset-backed, meaning they are secured by valuable assets like real estate, which serves as collateral. In the event that the borrower defaults on the loan, the lender can take possession of the collateral to recover their investment. Private money loans are generally short-term in nature, typically ranging from a few months to a few years. This makes them suitable for real estate investors, house flippers, or businesses in need of quick financing for projects. Private money lenders typically charge higher interest rates compared to traditional lenders. This higher interest compensates for the increased risk associated with these loans and serves as a financial incentive for private investors. Private money lending often provides a faster approval and funding process compared to conventional banks or mortgage lenders. This speed is beneficial for borrowers who require immediate capital. Private money lending allows for greater flexibility in loan terms, such as repayment schedules and interest rates. Borrowers and lenders can negotiate terms that suit their specific needs.
Private money lending plays a crucial role in various sectors, especially in real estate investing. Investors use these loans for property acquisitions, renovations, or when conventional financing is not readily available due to credit issues or property condition.
Wisco generally places loans for less than a one year term. It is dependent on the loan, but 6-12 months is a good rule of thumb for a range.
Wisco provides investors a 9-10% interest rate, pending the project. The investor deals directly with Wisco, and Wisco handles all the paperwork, loan underwriting, titling and recording of liens, draws, and any other procedures needed to ensure proper repayment of loans.
Fill out the contact form on our site, and someone will reach out to you promptly to introduce ourselves and learn more about what you’re looking for.
