All posts tagged: SEC Regulation A+

Triple Net Gain

David Sobelman was featured in the April 14th issue of Business Observer, discussing Generation Income Properties and upcoming milestones of the REIT.

Read the complete story on the Business Observer web site.

David Sobelman literally wrote the book on buying and selling triple net lease properties.

First published in 2010 — a time when such deals were largely unknown — “The Little Book of Triple Net Lease Investing” with business partner Jonathan Hipp is today in its second edition, and has sold more than 8,000 copies.

Now, after more than a decade at Tampa’s Calkain Cos. raising awareness and brokering such deals — in which expenses like utilities or taxes are “netted” out of gross rents and paid by tenants rather than landlords — he’s again venturing out.

Generation Income Properties, which Sobelman founded in September 2015 to target “NNN” opportunities, could begin trading publicly later this year, if it reaches certain U.S. Securities and Exchange Commission milestones.

In January, GIP attracted its 100th investor, an important SEC hurdle for REITs that is a precursor to any initial public offering. This summer, it expects to close on its first acquisition, a 7-Eleven store on the ground floor of a new residential building being constructed in Washington, D.C.

And during the third quarter, the company hopes to raise up to $20 million and begin trading on the Over The Counter exchange.

Continue reading…

GIPTriple Net Gain
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Net Lease REIT Under Contract with Prime Washington, DC Asset

Generation Income Properties, Inc., a Tampa, FL based real estate investment trust (“REIT”,) recently executed its first contract to purchase a property, occupied by a company owned 7-Eleven store (S&P: AA-), located in the middle of Washington, DC, just north of The White House. The new construction residential condominium building was completed in 2016 and the ground floor unit was developed to be occupied by a credit-worthy commercial tenant to support the high population density area surrounding the building.

David Sobelman, CEO, commented, “I am ecstatic that we are under contract with a property that perfectly matches the REIT’s investment criteria. Acquiring properties with the highest probability of appreciation during the REIT’s ownership, as well as having credit-worthy, long term real estate assets with prime real estate is our primary strategy. I’m thrilled to have found this street level retail asset in the heart of one of our target cities – Washington, DC.”

Closing on the asset is intended for the summer of 2017; subject to the parties’ due diligence and compliance.

About Generation Income Properties
Generation Income Properties, Inc. (“GIP”), a real estate investment trust (“REIT”), was founded by David Sobelman, a veteran net lease investment real estate broker. Mr. Sobelman is also the cofounder of Calkain Companies, one of the nations’ few real estate brokerage firms focused exclusively on triple net lease properties. Calkain has been involved with more than $10 billion in net lease transactions. GIP purchases assets with future generations in mind. GIP’s strategy is to acquire assets with credit-worthy, long term tenants solely in the top 20 highest density cities in the United States. The company intends to provide long-term stable yields to its investors, with a focus on future real estate values where the REIT has the best chances of appreciation through the value of the assets and/or rent growth. The single-tenant, net-leased investments that GIP identifies for acquisition are typically singletenant office, retail, or industrial buildings with existing leases of 10 to 25 years.

GIPNet Lease REIT Under Contract with Prime Washington, DC Asset
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A New Investment Outlook for REITs

Why REITs can be both an income and growth investment.

David Sobelman was invited to write the following article for the February 15th issue of Commercial Property Executive.

The growth of all the REIT’s aggregate market capitalizations has increased 68,074 percent in 45 years. NAREIT reports that from 1971 (Market Cap = $1,494 million) to 2016 (Market Cap = $1,018 billion) the REIT industry has grown to an extremely substantial industry. Granted, this growth is highly skewed as the REIT industry has drastically changed in the last almost-half century, and there are considerably more REITs in existence today than at the genesis of the industry. But what if you did invest in the REIT industry at the beginning and continued to invest along the way? Would you have more of a generational investment outlook?

There is a common perception among the investment community that a REIT is a “dividend machine.” Registered Investment Advisors (RIAs,) money managers, stock brokers, among others, explain the merits of REIT investing by the dividend in which it pays shareholders as one of their primary underwriting factors. But a REIT is really just a tax status in which the IRS dictates the percentage of profits (90 percent) that must be paid to investors.

Despite this, REITs are rarely seen as growth stocks; there seems to be a constant unwritten directive to always provide a certain dividend to an investor instead of increasing the stock price by practicing disciplined company decisions. Companies that are not hamstrung by operating under REIT rules have the benefit of reinvesting into their companies and growing their stock price by increasing the value of their firm. They pay either a low dividend or no dividend at all (i.e., Costco, Berkshire Hathaway and Amazon.com.) Therefore, how can a REIT adopt a strategy to grow its value while continuing to pay out its prescribed dividend?

One could look at the net asset value (NAV) of a company, which has a lot of emphasis on the share price of that company. The higher the value of the assets, typically the higher the share price.  When incorporating traditional real estate investing fundamentals, there is a strong possibility that an asset, or a portfolio of assets, will increase in value. Choose better real estate and there is a much higher likelihood of that asset increasing in value over time, which will, most likely and subsequently, increase the NAV of the company and therefore the share price. REITs using the public markets to own and grow the value of the real estate allow an investor to realize the growth in asset values during its ownership of their shares, whereas private investors would have to wait until there is a sale of that asset in order to profit from it.

REITs that focus on growth, rather than solely on providing a dividend, could earn an investor a higher compounded annual growth rate than those that just provide a steady dividend. REITs don’t have the benefit of reinvesting large amounts of capital into their companies, and they are therefore forced to make philosophical business model decisions from the outset—do they solely want to provide a dividend or would it be possible to purchase assets that increase in value and provide a dividend? Growth companies are the darling of any investor’s portfolio and there is no reason why REITs can’t be both an income and growth investment.  While it may not result in a 68,000 percent return, there is a lot of room for a REIT to be a growth model and a dividend model. Most current and future generational investors would see that as a very attractive scenario.

David Sobelman is the founder & CEO of Generation Income Properties (a public net lease REIT)

GIPA New Investment Outlook for REITs
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Net Lease REIT Expands Investor Interest in Generational Assets

Generation Income Properties (“GIP”) recently reached its 100 investor milestone with investments from individuals, family offices and investment funds. The Tampa, Florida based real estate investment trust (“REIT”) focusing on triple net lease property intends to begin purchasing real estate assets for its portfolio of properties in the first quarter of 2017.

David Sobelman, CEO, commented, “I am absolutely honored that the early investors believe in the growth strategy of the REIT as well as my abilities to follow through on the scalable investment philosophy. Our industry, to many, is still believed to be in its early stages considering that the current $100 billion triple net lease real estate REIT market is forecasted by some to be a $2 trillion industry.”

Interested investors are still able to participate in this offering prior to the company being listed on the OTC Markets exchange.

About Generation Income Properties
Generation Income Properties (“GIP”), a real estate investment trust, was founded by David Sobelman, a veteran net lease investment real estate broker. Mr. Sobelman is also the co-founder of Calkain Companies, one of the nation’s leading triple net lease investment brokerage firms. Calkain has been involved with more than $10 billion in net lease transactions. GIP purchases assets with future generations in mind. GIP’s strategy is to acquire assets with credit-worthy, long term tenants with great underlying real estate. The company intends to provide long-term stable yields to its investors, with a focus on real estate that has the best chances of future appreciation either through the value of the assets or growth through lease expirations. The single-tenant, net-leased investments that the company identifies are typically freestanding office, retail, or industrial buildings with existing leases of 10 to 25 years in the 20 most densely populated cities in the United States.

GIPNet Lease REIT Expands Investor Interest in Generational Assets
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2017’s Greatest Net Lease Challenge

While net lease remains one of the most stable asset classes, volatility and uncertainty in the market will present challenges for the sector.

David Sobelman was invited to write the following article for the January issue of Commercial Property Executive. 

We can all breathe a sigh of relief that the worry and stress of 2016 are over and we can now focus on the year ahead. Politics, interest rates and even sports have made us all wonder what could transpire and should we even try to fathom what the coming year entails. Every interview from our nation’s leading experts, in their respective fields, begins with an explanation on our nation’s micro and macro economies with the words, “I think.”  We’ve all heard it before but give it little attention when it’s spoken. For instance, a moderator asks, “Where are cap rights going in the next twelve months?” and the expert answers, “‘I think they will (insert answer here.)”  Or the moderator asks, “What will happen to commercial real estate values in 2017?” and the expert answers, “I think values will (insert answer here.)”  You get the picture.

But my colleagues and I, who are asked to opine on the state of the overall commercial real estate market and how tangential and outside influences may either impede or bolster the coming real estate cycle, are wondering ourselves how to navigate our and, in some cases, our clients’ decisions in the coming year. With the vast differences in answers to the questions we’re receiving, its clear that pinpointing a specific response is 2017’s greatest challenge. Even Hessam Nadji, president & CEO of Marcus & Millichap (M&M), who is a regular face on national television and a historical proponent of bringing into account the strength of the markets, chose to publicly sell 37,296 shares of M&M stock in the final months of 2016 at a value of roughly $2.5 million.  “I think” that sale may speak volumes to what his real thoughts may be on the coming market cycle.

But what we should all consider is that net lease investments have become an industry in and of themselves. The asset class is seen as one of the most stable types of commercial real estate investment, with as little as 250 basis points of variance from the trough of the recession to the peak of the market. Compared to other asset types, that spread is very manageable for most investors. Additionally, the International Council of Shopping Centers has begun to embrace the product type as it has instituted the N3 conference series around the country: panel discussions that highlight various regional topics focused on net lease assets. ICSC has also established the first education and information session for continuing education (CE) credits at its annual RECon conference in Las Vegas in May. These developments could be a strong indicator that the world’s largest real estate association has now embraced the building type as it has been clearly shown that the issues surrounding that market appeal to the masses. This is drastically different than just 10 years ago when a single-tenant investment was rarely mentioned outside its core practitioners.

2017 will prove to many, in and out of the net lease industry, that even in the most drastic of economic circumstances, a single-tenant property and the growing industry that surrounds the asset type will continue to resonate as the safe haven for landlords and investors. Few investment vehicles, real estate or otherwise, provide the risk-adjusted returns of triple-net lease properties. Add in the opportunity for an appreciating real estate asset and annual returns could far outpace anything in its peer group. But despite its stability, the sector will face its challenges. History has shown that the hurdles of the net lease sector are not solely in the ups and downs of the market, but in attempting to precisely time the market—that is this year’s biggest challenge.

David Sobelman is the founder & CEO of Generation Income Properties (a public net lease REIT) 

GIP2017’s Greatest Net Lease Challenge
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Generations Income Property Competes for SBRE Shark Bowl

Five Small Balance Real Estate (SBRE) Entrepreneurs will compete for a chance for a $100,000 investment at SBREfunds.com’s live Shark Bowl contest

SBRE industry founder Fairway America today selected five SBRE entrepreneurs to present to a panel of seasoned real estate “sharks” and have an opportunity to receive a commitment from one of Fairway’s proprietary funds for a $100,000 investment. The winner will be required to complete a due diligence process in order to receive the investment.

“We wanted to provide new and emerging SBRE fund managers and entrepreneurs an opportunity to develop a presentation, get up on stage, and hone their pitch,” said Fairway’s CEO Matthew Burk. “Not only will it be great fun, having a legitimate opportunity to receive an investment on the line makes it much more interesting and real. We have some very deserving presenters lined up and I can’t wait to see them pitch.”

The presenters who will be competing at the SBRE Shark Bowl are Brian Lynott from Dweller, Randy King at The Legacy Group, Michael Zajas of Brydant Inc., Aaron Gillingham with Aries Capital Northwest, and David Sobelman from Generation Income Properties.

“This group of presenters represents a great cross-section of the SBRE industry and is an excellent example of the amazing diversity of strategies being executed in the space,” said Burk.

The CapitalFlow Conference will be held annually in Fairway’s home town of Portland OR and is expected to attract leading SBRE entrepreneurs and fund managers from around the United States. The main theme for these entrepreneurs is to enhance their capacity to successfully raise capital for their SBRE deal strategy, which the Shark Bowl is expected to help promote. Burk says that Fairway has borrowed bits and pieces of different formats and structures he seen over the years and amalgamated them into a unique construct.

“The CapitalFlow Conference format has been designed by SBRE fund managers for SBRE fund managers (and syndicators) to meet the core challenges and needs of this underserved group,” said Burk.

In order to continue to help facilitate the growing SBRE community of entrepreneurs and investors, Fairway has created a unique and powerful formula that is unavailable anywhere else. In addition to the Shark Bowl, a mini-version of Fairway’s highly sought-after SBRE Investment Summit, the conference also features deep-dive content on fund management issues, capital raising strategies and tactics, and peer-to-peer experience share.

“We work with SBRE fund managers, syndicators and high net worth investors all over the country,” said Burk, a longtime fund manager and investor who will be one of the panelists of Sharks. “Because we have such a deep understanding of the practical challenges we all face, we’ve engineered the CapitalFlow Conference to provide unequaled take home value to the SBRE entrepreneur.”

Fairway will also be announcing the winner of the 1st Annual SBRE Awards in 5 categories as follows: Fund Manager of the Year, Emerging Fund Manager of the Year, SBRE Entrepreneur of the Year, Syndicator of the Year and the first ever inductees into the SBRE Hall of Fame. Finalists have been named in all categories and most or all of them will be on hand for the awards ceremony.

The event will be held at the Portland Hilton Hotel and Towers in downtown Portland Oregon. Winners of the SBRE Awards will be announced during a lunch ceremony on Friday July 29th and will be immediately followed by the SBRE Shark Bowl. The event will conclude at the Willamette Riverfront Park for the 25th Annual Oregon Brewfest, the oldest and largest gathering of microbreweries in the United States. Registration for the event is still open to SBRE entrepreneurs, fund managers, private lenders, and real estate syndicators, as well as high net worth investors who are interested in learning more about the growing SBRE alternative investment space.

“What really makes it all so powerful are the reasons why we come together in the first place – to engage each other on the challenges, strategies, and opportunities of running an SBRE business,” said Burk. “We share ideas, best practices, successes and failures, what works and what doesn’t without fear of judgment or reprisal from other managers – just mutual trust and respect for what we all have to go through to run a successful SBRE enterprise and create value for investors.”

About Fairway America
Fairway America, LLC is a longtime real estate asset based fund manager and real estate finance advisory firm providing strategic business planning services nationwide to SBRE entrepreneurs around the structure, architecture, and administration of proprietary 506 Regulation D pooled investment funds. Fairway’s related entities manage two proprietary funds, Fairway America Fund VI, LLC, and Fairway America Fund VII LP, each focused on the SBRE space with different asset allocations and investment features. Both funds consider investments nationwide.

About SBREfunds.com
SBREfunds.com is an online education, information and match-making site that exclusively lists small balance real estate investment opportunities. Created by Fairway America, SBREfunds.com provides entrepreneurs and investors with education and connectivity to better capitalize and grow an SBRE enterprise. From connection with investors to strategic capital raising plans to live events, SBREfunds.com is the definitive resource for SBRE entrepreneurs and accredited investors to understand how to successfully work with one another for mutual benefit and growth.

Neither Fairway America nor SBREfunds.com is a registered broker-dealer or investment advisor. None of the Fairway companies perform any activities of a broker or investment adviser, including but not limited to, soliciting investors, providing investment advice, negotiating securities transactions or the terms, conditions or provisions of any offering, or recommending the purchase of securities. This press release does not constitute an offer or solicitation to sell securities in any of the companies mentioned, any funds presenting at SBRE Summit events, or any related or associated companies. Investors must not rely on information provided in this press release for investment decisions.

GIPGenerations Income Property Competes for SBRE Shark Bowl
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Inside the First REIT to Go Public Under Regulation A+

David Sobelman, CEO and Founder of Generation Income Properties talked with Commercial Property Executive about the REIT’s unique fundraising strategy and what sets it apart from others in the net lease space.

“In today’s competitive net lease environment, companies in the space need to find ways to set themselves apart. David Sobelman is doing just that with his REIT, Generation Income Properties (GIP), which this year became the first REIT to go public under the SEC’s Regulation A+. A net lease veteran, Sobelman co-founded Calkain Cos. in 2005 before founding GIP, which started out as a private fund. But when he went back to investors asking about starting another fund or becoming a publicly traded REIT, they were interested in the latter.”

You can read the complete article on Commercial Property Executive and see the interview in the video below:

GIPInside the First REIT to Go Public Under Regulation A+
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Huffington Post Highlights First 16 Reg A+ Companies

The Huffington Post highlights the first 16 companies approved under SEC Regulation A+, including Generation Income Properties.

“Ever since President Obama signed the JOBS Act in 2012, the market for equity crowdfunding has grown steadily. Now, in 2016, funding raised through crowdfunding is expected to pass that from venture capital.

At the center of this revolution in business financing are the Securities and Exchange Commission’s recently enacted rules known as Regulation A+, a provision of the JOBS Act that allows companies to generally solicit and raise money from non-accredited investors. Historically, many investment opportunities have only been open to the wealthiest 3% of Americans known as accredited investors. However, the new rules permit nearly anyone to invest in companies spanning a wide range of fields, from real estate to aviation and even medical marijuana.”

You can read the complete article at the Huffington Post.

GIPHuffington Post Highlights First 16 Reg A+ Companies
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Generations Income Properties Featured in Restaurant Finance Monitor

David Sobelman was interviewed for Restaurant Finance Monitor, a monthly publication focused primarily on the restaurant investment industry.

“Sobelman is not a stranger to real estate investing. He’s had his own private fund since 2012, and he’s the managing member, with outside investors. It’s been successful, and his investors wanted to know when he would launch the next one.

“They liked their returns, and they liked me running it,” he said. “I thought we needed to do it bigger the next time around.” He talked to his investors about a publicly traded REIT, and they were in.

“They would have their own shares, trade them when they wanted to, and have some sense of liquidity, as opposed to a fund, which is more arduous to exit,” Sobelman said. “They loved it.” Sobelman himself liked the transparency of public traded REIT, where investors and others could go online and look at filings, and that it would be “extremely scalable.”

Read the complete article on page 3 of Restaurant Finance Monitor.

GIPGenerations Income Properties Featured in Restaurant Finance Monitor
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Net-Leased Pro Aims to Raise Capital for REIT Through Mini-IPO

David Sobelman, Generation Income Properties Founder and CEO, was interviewed by Commercial Real Estate Direct to discuss the launch of the REIT and the unique position it takes in the market.

“David Sobelman, a long-time player in the net-leased real estate business, has launched a REIT. But it’s not like any other REIT, traded or not.

“His Generation Income Properties Inc. takes advantage of Regulation A+, part of the Jumpstart Our Business Startups, or JOBS, Act that was signed into law in 2012. The rule allows investment offerings to be marketed to non-accredited investors in offerings up to $50 million. It also streamlines the registration process by, for instance, not having to register a securities offering in every state that it’s offered.

Generation Income initially aims to raise $20 million through its so-called mini-IPO by selling shares for $5 each through a best-efforts offering, meaning Sobelman will be making his best effort to place shares with investors. In a traditional underwritten stock offering, an investment bank is used as an intermediary and commits to sell a specific number of shares to investors. Shares in the REIT will be traded over the counter.”

With a registration, you can read the complete article on the Commercial Real Estate Direct web site.

GIPNet-Leased Pro Aims to Raise Capital for REIT Through Mini-IPO
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