Breakwater will never charge a fee before, during or after this entire process. Our services are complementary to the client as we are paid directly from the offering for a percentage of the amount we help them raise. While this compensation does come from invested assets, your equity in the offering is not reduced. We will work at your pace and cater to all different sorts of clients, whether this is your first exchange or you are a seasoned vet.
Please see a detailed summary of our end-to-end execution process:
STEP 1
01 Discovery AND General Education
The first step is to have a conversation with you and determine whether we are a good fit for your needs. We inquire about your specific financial situation, as well as your goals and objectives, and discuss all potential real estate investment solutions.
STEP 2
02 SPONSOR INTRODUCTION & SPECIFIC PROPERTIES
Once we determine the best course of action and narrow the field down based on your feedback, we will then strive to connect you to the proper sponsors to discuss current actual properties that are in-line with your exchange timing. We believe it is important that investors have a direct relationship with the sponsor(s) who will be managing the property and get comfortable with their investment philosophies and decision making processes.
STEP 3
03 RESERVATION AND ID PROPERTIES
After you are comfortable with a selection of possible DST targets, we can then begin the process of reserving equity in each property. While the sponsor will often endeavor to hold this reservation for as long as possible, sponsors cannot typically decline other investors indefinitely. Nonetheless, it is important that you take the time you need to ensure you are comfortable with an offering prior to investing. Should you change your mind or if your sale fails to close, you are under no obligation to the sponsor. We will also work with your QI to ensure that the properties are correctly identified to satisfy all IRS requirements. If you do not have a QI we can recommend one of our trusted partners.
STEP 4
04 PAPERWORK AND DOCUMENTATION
Once you are 100% confident in the property selections, we will provide all the necessary documents and streamline the process as much as possible. You will be surprised how much more efficient this process is when a bank is not involved.
STEP 5
05 PERFORM EXCHANGE/ PLACE FUNDS
If done properly, the entire process of funds transferring from escrow to the QI to the DST can take place in as little as 3-5 business days. Our clients love when this is done efficiently because this short time frame allows for the potential of avoiding an income stream disruption.
STEP 6
06 Potentially start receiving income immediately – The fun part!
Your potential income distribution will begin to accrue from the day you close on the DST. The first month may be prorated based on the day of the month you close, and sponsors typically seek to pay distributions mid-month for the previous month of operations. Of course, any dividend payment is not guaranteed.
STEP 7
07 Monitor, Plan & Adjust Throughout The Years
We remain by your side throughout the lifetime of your investments. We track your individual plan to review whether it is working for you over the long haul.
STEP 8
08 POTENTIAL LIQUIDITY OPTIONS FOR YOUR PROPERTY-INTERESTS
Over time you may require liquidity to address income needs or other unexpected variables. When this happens, Breakwater provides a potential option for selling or exchanging individual property interests with other investors.
Of course, it is important to remember that these investments are illiquid, and, as such, there may be no secondary market, and you should never invest unless you believe that you are able to hold the investment for the life of the offering.
Start making more informed choices for your financial future with Breakwater Capital. Schedule a free in-person or virtual consultation so we can get to know each other. During our meeting we will discuss your finances at length to determine if Breakwater Capital is right for you.
Fill out a Contact Form to Request More Information or Schedule a Consultation
9940 Research Dr. Suite 200 Irvine, CA 92618
(310) 940-9430
Josh@Breakwater1031.com
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All investing involves risk of loss of some or all principal invested. Past performance is not indicative of future performance. There can be no guarantee that any investment or strategy will achieve its stated objectives. Speak to your tax and/or financial professional prior to investing. Securities and advisory services through Emerson Equity LLC, member FINRA and SIPC and a registered investment adviser. Emerson is not affiliated with any other entity identified herein.
There is no guarantee that any strategy will be successful or achieve investment objectives; Potential for property value loss – All real estate investments have the potential to lose value during the life of the investments; Change of tax status – The income stream and depreciation schedule for any investment property may affect the property owner’s income bracket and/or tax status. An unfavorable tax ruling may cancel deferral of capital gains and result in immediate tax liabilities; Potential for foreclosure – All fnanced real estate investments have potential for foreclosure; Illiquidity –These assets are commonly offered through private placement offerings and are illiquid securities. There is no secondary market for these investments;Reduction or Elimination of Monthly Cash Flow Distributions – Like any investment in real estate, if a property unexpectedly loses tenants or sustains substantial damage, there is potential for suspension of cash flow distributions; Impact of fees/expenses – Costs associated with the transaction may impact investors’ returns and may outweigh the tax benefts. Stated tax benefts – Any stated tax benefts are not guaranteed and are subject to changes in the tax code. Speak to your tax professional prior to investing.
Investing in opportunity zones is speculative. Opportunity zones are newly formed entities with no operating history. There is no assurance of investment return, property appreciation, or profits. The ability to resell the fund’s underlying investment properties or businesses is not guaranteed. Investing in opportunity zone funds may involve a higher level of risk than investing in other established real estate offerings. Long-term investment. Opportunity zone funds have illiquid underlying investments that may not be easy to sell and the return of capital and realization of gains, if any, from an investment will generally occur only upon the partial or complete disposition or refinancing of such investments. Limited secondary market for redemption. Although secondary markets may provide a liquidity option in limited circumstances, the amount you will receive typically is discounted to current valuations. Difficult valuation assessment. The portfolio holdings in opportunity zone funds may be difficult to value because financial markets or exchanges do not usually quote or trade the holdings. As such, market prices for most of a fund’s holdings will not be readily available. Capital call default consequences. Meeting capital calls to provide managers with the pledged capital is a contractual obligation of each investor. Failure to meet this requirement in a timely manner could elicit significant adverse consequences, including, without limitation, the forfeiture of your interest in the fund. Leverage. Opportunity zone funds may use leverage in connection with certain investments or participate in investments with highly leveraged capital structures. Leverage involves a high degree of financial risk and may increase the exposure of such investments to factors such as rising interest rates, downturns in the economy or deterioration in the condition of the assets underlying such investments. Unregistered investment. As with other unregistered investments, the regulatory protections of the Investment Company Act of 1940 are not available with unregistered securities. Regulation. It is possible, due to tax, regulatory, or investment decisions, that a fund, or its investors, are unable realize any tax benefits. You should evaluate the merits of the underlying investment and not solely invest in an opportunity zone fund for any potential tax advantage.
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