Leveraging Commercial Real Estate For Retirement
Strategies for diversification and passive income
Build Wealth For Your Future
Commercial real estate is one of the most popular non-traditional asset classes for retirement investing. An investment in real estate has the potential for long-term appreciation as well as consistent cash flow. Combined with the potential tax advantages of a qualified retirement plan, an investment in real estate may present a compelling case for building a sufficient nest egg.
RETIREMENT FUNDS AND REITS
A simple way to invest in commercial real estate is through a Real Estate Investment Trust (REIT). REITs are a diversified basket of commercial real estate and can have the objective of appreciation and cash-flow, without any of the day-to-day property management responsibilities for the investor.
The RealtyMogul platform allows investors to use retirement funds from their Self-Directed IRAs (SDIRAs) to purchase shares in public, non-traded REITs. By allocating to real estate, investors diversify their portfolios and potentially generate income that can grow and compound within a tax-sheltered IRA over time.
REITS: A RETIREMENT INVESTMENT TOOL
REITs are known for their objective of regular, passive income, because they are required to distribute at least 90% of their annual taxable income to investors on a yearly basis through distributions. Another characteristic of commercial real estate is the potential to protect against inflation. This benefit arises because property values and rents have historically been correlated with growth in inflation.
Real estate has a low (or negative) correlation to other asset classes, which means REITs may shield IRAs from market volatility.
REITs are designed to generate monthly or quarterly distributions, which investors may elect to automatically reinvest.
Over time, real estate has the potential to grow in value and may even outpace inflation.
INVESTING IN REITS FOR RETIREMENT
Over the long-term, REITs compare favorably to traditional investment indexes, such as the S&P 500 and U.S. bonds. When distributions are automatically reinvested and allowed to compound over time, a retirement portfolio has the potential to generate long-term tax deferred growth.
ANNUALIZED RETURNS (%) AS OF 12/31/20
STRATEGIC APPROACHES TO RETIREMENT
Many investors would agree that successful retirement planning requires a holistic strategy – one that seeks both income and appreciation. To accommodate this approach, each of the following REITs offer a different objective.
MOGULREIT I: DIVERSIFIED
MogulREIT I is a public, non-traded REIT that is focused on providing monthly income to investors through debt and equity investments in a diversified pool of commercial real estate property types including multifamily, retail, office, and industrial.Learn more >
MOGULREIT II: MULTIFAMILY
MogulREIT II is a public, non-traded REIT that is focused on providing investors with the opportunity for capital appreciation by investing in value-add multifamily apartment buildings with both preferred and joint-venture equity.Learn more >
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