Weststone now offers fund companies and investment firms the chance to invest in our deal-by-deal real estate projects alongside our investors. With our unique investment offerings and proven track record, we can offer fund companies greater diversification and flexibility in their funds’ portfolios.
Through our strategic value-add approach, we are able to offer higher-than-average returns to investors. And because we professionally handle every aspect of each deal from start to finish, your returns are completely passive!
The benefit of investing with Weststone
Most fund companies go after the 30% of the real estate market with the larger deals, because it is hard to find, manage, and develop many small projects at the same time. Most companies are not set up for this type of volume. Each project requires a lengthy due diligence process, which also lead to higher overhead cost. Funds with a lot of capital to put to work therefore tend to target fewer projects in larger scale instead. Ultimately, missing out on a lot of good opportunities.
Weststone saw an opportunity to target the remaining 70% of the real estate market. We found a way to handle the small to medium size investments in volume. By streamlining the process through our proprietary software, we can automate the performance calculations, investment offerings, construction management, 1065 and K-1 tax filings etc., while keeping overhead costs low and this way generate higher returns to investors.
By partnering up with well-established developers and operators in different markets across the US we can offer deal flow, diversification and unique investment types to fund companies.
How fund of funds investing works
Fund on funds investing is when one fund (any entity that pools money from multiple investors to purchase assets) invests in another fund.
With Weststone’s fund of funds structure, the fund itself acts as the investor in the deals. When a fund invests as an equity investor in one of our properties, they have an ownership stake in the LLC that owns the property. Weststone is the manager of the LLC, and the fund is a member of the LLC.
Weststone handles each project from start to finish. We provide monthly updates on the status of the project and provide progress photos through our online dashboard. Once the project is complete, the initial investment plus any profit is disbursed back to the fund. At that point, the fund handles the distribution of proceeds to the investors in their fund.
Also, instead of taking any upfront fees, which is common for other crowdfunding and syndication companies, Weststone take a service fee only from the profit. That means, in order for Weststone to receive anything for its hard work, the investment must be profitable.
Weststone Investment can accept any fund in which all investors in the funds are accredited investors. Please note: If any investors in the fund are not verified as accredited, the fund will not be able to invest in our syndication deals.
Reasons for funds to invest with Weststone
There are several reasons why it makes good sense for funds to invest in Weststone’s real estate projects.
Fund diversification.
Funds can invest with Weststone as a way of diversifying their fund’s portfolio. Maybe your fund doesn’t have any real property holdings, and you want to use a percentage of your fund to capitalize on the real estate market. Or perhaps you are already investing in real estate, but your fund is too heavily invested in commercial, and you would like to incorporate residential. Or you might have too many long-term holdings and you’re looking to add some short-term real estate investment projects. In each case, you can invest a percentage of your fund with Weststone to easily increase the real estate holdings in your portfolio.
With Weststone’s flexible offerings, you can choose from value-add projects, ground-up developments, and multi-family rentals, each of which can help you create a more balanced fund portfolio.
Short-term real estate investments.
Our short-term real estate investment projects provide unique benefits for fund of funds investors.
Our short-term options include house flips and smaller multi-family developments with hold periods ranging from 6-20 months. These projects offer a great opportunity to funds that want a more liquid investment option.
For example, let’s say your fund has raised the capital needed for your next investment project, but your project will not need all the money immediately. Instead of leaving your money in the fund uninvested, you could put this money to work with short-term options from Weststone Investment. This allows you to grow the capital in the short term and have the money returned to the fund by the time you need it.
Put your overfunding to work.
After you have already raised the capital for your investment fund, you may find that you raised more than you needed for your project. With excess cash on hand, you want to put this money to work for your investors, but it may not be enough capital to purchase a new property. Instead of allowing that capital to sit in a low-return account, you can invest it with Weststone to generate higher returns for your investors.
With our low minimum investment amounts, you have an easy and accessible way to put extra capital to work.