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Concepts

November 5, 2024

7 min read

Why a Distribution May Be Classified as Return of Capital (and Why That’s a Good Thing)

Have you ever received a distribution from a real estate fund or syndication...

Let’s start by clarifying the difference between cash flow and taxable income. In real estate funds, cash flow represents actual cash generated from sources like rental income or lending activities, but taxable income is often much lower than cash flow because of non-cash deductions—especially depreciation.

Depreciation is a valuable tax tool in real estate. It allows funds to deduct the “wear and tear” on assets from their taxable income without reducing actual cash flow. The result? Funds often have much more cash to distribute than taxable income to report.

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November 2, 2021

4 min read

A Step-by-Step Guide to Conducting Due Diligence in Private Equity Real Estate

When it comes to private equity real estate, due diligence is a crit...

When it comes to private equity real estate, due diligence is a critical process to ensure your potential investment aligns with your financial goals and risk tolerance. The process can seem intimidating, especially for beginners, but it is essential for protecting your investment and maximizing returns. The steps discussed here will provide a strong foundation for a thorough due diligence process.

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