If you’ve been receiving investment opportunities from us, you probably notice a theme. We don’t publicly advertise our investments. In fact, the only way my investor audience can get exposed to and involved in an apartment syndication is by meeting with me. Why is that?
When I created Avanza Investments, my goal was to expose working professionals, immigrants, and first-generation investors to the power of real estate investing. This approach to investing is not generally known and is a great way to generate wealth that is independent from the hours you work. However, I realize that many immigrants and first-generation investors don’t have a million dollars or more of net worth. That’s why I wanted to figure out a way to allow these individuals to get involved as well.
In order to do this, I have decided to pursue a path of 506(b) investment offerings. What does that mean, exactly? The SEC generally has two primary exemptions that allow us to put together apartment acquisitions and raise money from retail investors like you: 506(b) and 506(c). There are a number of differences between these two exemptions, but the primary one is that 506(c) investments allow us to accept investments only from ‘Accredited’ investors. The SEC defines Accredited investors as those with at least $1 million in net worth (excluding their primary residence) or they make $200k/year as an individual or $300k/year with a spouse.
506(b) investments allow us to accept investments from ‘Sophisticated’ investors as well. These are individuals that may not have the net worth or income of an Accredited investor, but they do have investing experience in other asset classes like the stock market, etc.
While the 506(b) investments allow us to accept individuals that don’t meet the Accredited investor definition, it does come with a major drawback. We can’t advertise them! As a matter of fact, we can only promote this type of investment to people we already have a relationship with. That’s why meeting with me first is so important. We need to establish a relationship and I need to make sure that this type of investment would work for your goals.
While I do believe we could reach a much larger audience pursuing only 506(c) investments, this would shut out a large portion of the types of people I am trying to help. I do believe we will offer some 506(c) investments in the future, but we will stay focused on 506(b) opportunities that the most immigrants and first-generation investors can be eligible for.
If you haven’t met with me yet, I encourage you to do so by clicking here. As I’ve mentioned, it’s the only way to be exposed to apartment investing opportunities.
To your investing success!