The fund allows redemption after 2 years from the time the investment is accepted. The amount of the redemption is the total number of shares (which may be different from the number of shares at initial investment if dividend reinvestment option is chosen) multiplied by the unit price at the time of the redemption. Prior to this 2-year lockup period, request for redemption due to hardship may be granted solely by the sponsor but a 5% redemption fee must be paid. Such a request may or may not be granted.
This is an evergreen fund so that means you can invest into the fund at any time. However, the per-share price depends on the date when you invest. At the inception in May 2015, units were priced at $1,000 per share. After you sign the subscription documents and send in your funds, your money will sit until it is needed. Currently, the wait is 2-3 months. When deployed, you earn 8% interest as a temporary note, until the first day of the following quarter, when your temporary note is converted to units in the fund. The fund pays an 8% preferred return and 70/30 profit split (also called promote) after the preferred return. Note, the 8% preferred is based on the actual capital invested while the 70/30 split is based on the number of shares you hold.
At the end of each quarter, closing reconciliations are completed for all of the properties owned by the Fund. Once each account is closed, the third party administrator consolidates them into the Fund financials and calculates the amount of each investor's’ distribution. Once we know your distribution amount, we will send a check or direct deposit/ACH. This can take up to 30 days.
Each property in the Fund is managed by a third-party property management company or Alturas Management Group. At the end of the quarter, each property goes through a full closing process, which can take a couple of weeks. Once the Alturas Management Group receives the reports, they are reviewed internally for accuracy and sent to the third-party administrator. They consolidate the financials, which includes ensuring that these are completed in accordance with generally accepted accounting principles. The third-party administrator also calculates the quarterly unit price at which new investors buy into the Fund, and calculates each investor's’ distribution. The third-party administrator prepares capital account statements for each investor for the quarter. After the Manager reviews the distribution calculations and statements, they send a check or direct deposit/ACH to your account.