Rich Uncles – What is it?
Rich Uncles is one of the newest entrants into the Real Estate Crowdfunding space. They offer Real Estate Investment Trusts or REITs with their own unique spin on how the deals are sourced.
Two important facts jump out about the company right away.
Firstly, the Rich Uncles real estate team comprises 150 years of acquisitions and management experience and $3 billion in transactional volume.
Secondly, the evaluation method employed by Rich Uncles allows the company review over 1000 real estate deals each week with only the top .3% of all deals reviewed ultimately meeting the Rich Uncles acquisition criteria.
About Rich Uncles
In 2012, Uncle Ray Wirta (Chairman), launched the idea of “Real Estate Investing for Everyone” and Rich Uncles was born.
Ray is a board member and former chairman of CBRE Group, Inc. (NYSE:CBG), a fortune 500, as well as, S&P 500 company that is the world’s largest commercial real estate services and investment firm with 2015 revenues of $11 billion.
With approximately 75,000 employees, CBRE serves real estate owners, investors, and occupiers in over 450 offices worldwide. To put it another way, CBRE is no small startup.
Harold Hofer is the company’s Vice Chairman and responsible for the overall direction of the company, including real estate, finance, and legal. Harold is a seasoned real estate expert with $2 billion in transactional experience. He is also a graduate of the UCLA School of Law.
Over the past 30 years Harold has sponsored numerous real estate funds for individual investors in the form of Limited Partnerships, Limited Liability Companies, and Real Estate Investment Trusts.
In fact, it was long before Crowdfunding’s rise to popularity that Harold began helping wealthy investors enjoy the kind of opportunities Rich Uncles offers you today.
Aaron Halfacre is Rich Uncles Chief Executive Officer. Mr Halfacre is responsible for crafting company-wide strategy and accelerating business growth.
Aaron previously held positions such as, President at RealtyMogul, President and Chief Information Officer of Campus Crest, and senior leadership positions at Cole Real Estate Investments, BlackRock, and Green Street Advisors.
How to Get Involved
Registration is free, but required to begin to take a look at available investments. Currently, the platform has only two investment choices available.
Options
The company offers two independent offerings – BRIX REIT and the NNN REIT.
Brix Reit focuses on purpose-built student housing and multifamily properties that serve public and private universities.
NNN Reit focuses on single-tenant office, industrial and retail properties leased to nationally recognized corporate tenants.
NNN REIT
- Available to residents of CA, CO, CT, FL, GA, HI, ID, IL, IN, KY, LA, MO, MT, NH, NV, NY, SC, SD, TX, UT, VA, VT, WI, and WY.
- Estimated Annualized Dividend: 7%
- Located in primary, secondary and tertiary markets
- Specialized in commercial properties that leverage a triple net (NNN, get it?) structure.
- Rich Uncles acquires these properties with 50%+ cash down.
- Minimum required investment is $500
BRIX REIT
- Available for investment in all 50 states and worldwide;
- Estimated Annualized Dividend: 6%
- Specialized in student housing;
- With a minimum capacity of 150 beds
- Maintain 90% rental occupancy rates;
- Minimum required investment is just $5
Rich Uncles does not require you to be an accredited investor to come on board. However, they do have minimum income restrictions which they place on would-be investors.
You can begin investing with Rich Uncles within minutes of opening your account with as little as $5. I believe I did just that when I opened my account in January 2019.
Rich Uncles Fee Structure
Much like most publicly traded Real Estate Investment Trusts (REITS), and several crowdfunding platforms available today, Rich Uncles does not charge any transaction fees or commissions when you buy into either of their investments.
Superb thing about this is you can invest $5 and expect to have at least $5 in your account on day one, as opposed to say $4.95 if there was a 1% transaction fee.
Important to realize, Real Estate Crowdfunding Investing is best approached as a long-term play. You should know that and plan accordingly when making the decision to invest.
On the negative side, if and when you do decide to redeem your shares however, a small fee is levied against you based on the length or extent of time you’ve held the shares for.
The breakdown of the annually declining redemption fees you can expect is shown below…
- Shares held less than one year – A 3% admin fee is levied
- Shares held 1 – 2 years – a 2% admin fee applies
- Shares held 2 – 3 years – a 1% admin fee applies
- Shares owned 3 or more years – there is no admin fee
I have personally found the Rich Uncles platform super easy to use (and i’m no techy) and pleasantly user-friendly.
Markedly, these uncles know what they know and stick to it, from an investment strategy standpoint.
The Brix Reit for instance, has to be student housing property within a mile from a large college campus (at least 15000 students) and with at least 150 beds.
In Summary…
In just over a year of investing with Rich Uncles, I have received a steady return on my investment of about 7% which isn’t too shabby for a set it and forget type of investment.
I have never heard reports of the company missing dividend payments and so far, I simply have not had to speak to anyone at Rich Uncles, ever, which signifies to me they are a well oiled machine in their day to day operations.
As a crowdfunding company, Rich Uncles definitely has it’s competitors lining up quickly. Fundrise is a similar platform but without the specificity aspect to their investment strategies.
RealtyMogul and Streitwise are other crowd funding alternatives to Rich Uncles.
I hope this Rich Uncles Review provides you some more insight into the company and your decision moving forward.
Each of these crowdfunding companies I’d say are worth taking a peek at if you are thinking about getting involved in real estate crowdfunding investment opportunities to diversify your portfolio.
