• Ian Ippolito

Best Core and Core Plus Investments of 2017-2018


The best of this almost impossible-to-find, but highly recommended and historically high-performing strategy.

(Disclaimer: I'm an investor and not a financial advisor or attorney. Consult your own financial and/or legal advisors before making any investment or legal decisions.)

Elusive core investments

There are four different investing strategies. Core and core plus are designed to generate the most consistent and reliable income with the lowest volatility and risk. To maximize safety, they're also the least leveraged of all the strategies. (Click here to learn all about the four different strategies.)

The typical real estate investment advisor recommends a significant amount of core/core plus in every investor portfolio:

  • Conservative/income focused investor: 80% (+/- 20%)

  • Moderate/balanced focused investor: 50% (+/- 20%)

  • Aggressive/appreciation focused investor: 10% (+/-10 %)

The problem is that core and core plus investments are MIA ("Missing in action") on 99% of crowdfunding platforms. This makes it very difficult to create a properly balanced portfolio. (One exception is 1031 crowdfunding, that is almost completely core. However, the high fee/commission structure is, in my opinion, too much for the average investor who isn’t looking to do a 1031 exchange).

King Core

Missing out on core/core plus is a big deal. A University of Chicago study found that from 1996-2016, these strategies outperformed value-added and opportunistic strategies on a risk-adjusted basis. (A major reason was the lower cost of leverage and lower fees).

So a portfolio without core/core plus is a portfolio that’s under-performing its potential, as well as taking on more risk than necessary.

“Show Me the Core!”

Institutional investors have plenty of core/core plus options. The problem is, most require a $5 million minimum investment (or more), which is out of the question for most accredited investors.

However, there are a handful of alternatives for us mere mortals. I’ve turned over every rock and stone to find them, and present them here. Part 1 of this article talks about the best core plus options. Part 2 talks about core options. Core Plus Funds

  • Blackstone Real Estate Income Trust (BREIT)

  • BroadStoneNet lease

  • stREITWise: 1st stREIT Office

Core Funds

  • BlackRock US Core Property

  • RREEF Property Trust

  • USQ Core Real Estate Fund

  • Predex

The rest of this two-part article has an in-depth analysis of the above funds and is available to members of The Real Estate Crowdfunding Review private investor club. Membership is free but is restricted to investors who have no affiliation to any platform or sponsor (other than as a customer).

Click here to view the rest of this article series, and/or to apply for membership.

#core #coreplus #BlackstoneRealEstateIncomeTrustBREIT #Broadstone #streitwise #BlackrockUSCoreProperty

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About Ian Ippolito

Ian Ippolito is an investor and serial entrepreneur. He has been interviewed by the Wall Street Journal, Business Week, Forbes, TIME, Fast Company, TechCrunch, CBS News, FOX News, USA Today, Bloomberg News, Realtor.com, CoStar News, Curbed and more.

 

Ian was impressed by the potential of real estate crowdfunding, but frustrated by the lack of quality site reviews and investment analysis. He created The Real Estate Crowdfunding Review to fill that gap.

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Code of Ethics: I do not receive any money from any sponsor or platform for anything including guides, tutorials, postings, reviews, referring investors, affiliate leads or advertising. Nor do I negotiate special terms for myself above what I negotiate for the benefit of members. For clarity: I do receive monetary compensation in 2 ways. Site members can send donations (and a $200 donation entitles them to access my personal low-level due diligence notes on investments I've put money into). And if the club chooses to create a feeder, I take a fee as manager (and keep the excess beyond expenses). Additionally I receive the same non-monetary compensation all club members do: access to otherwise inaccessible sponsors, millions of dollars of special deals and discounts, the satisfaction of giving back and helping others, and more.

I/we are just investors expressing our opinion, and are not registered financial advisors, nor attorneys nor accountants. Always consult with your own licensed professional before making any investment decision. All information provided is personal opinion only, and does not constitute professional, financial, tax, legal or other advice.