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Streitwise Review - Everything You Should Know

Streitwise Review

If you’ve been looking to diversify your portfolio with real estate, you should take a closer look at Streitwise.

Streitwise Overview

Streitwise is a public real estate investment trust that is not traded on the open market. It offers one fund and you can only access the fund directly through Streitwise. This investing platform should not be confused with other crowdfunding platforms. It is a REIT - not a crowdfunding platform.

Streitwise is a relatively younger company that was founded in 2017. The platform claims to have generated an annualized return of 9.2% in dividends. Investors can enroll in a dividend reinvestment program if they wish to keep acquiring more shares. Along with dividends, investors can gain equity value when the share price increases.

Streitwise is held by their parent company Tryperion Holdings. Typerion Holdings has extensive experience and assets within commercial real estate and other investments.

Streitwise currently has two properties and is located in St. Louis and Indianapolis. This lack of diversification allows its managers to stay focused but also keeps investors from owning a range of properties. Some REITs hold several properties and some hold equity positions in properties. A unique feature of Streitwise is the transparency of what they hold. They plan to buy more properties but they currently own these two.

Indianapolis - Allied Solutions Building

  • $32 million mixed-use building
  • Located in midtown Carmel, IN - an affluent suburb of Indianapolis
  • 142,000 square feet
  • Allied Solutions, LLC holds 108,000 with a lease until 2030
  • Other tenants include: F.C. Tucker, Fork & Ale House, Java Cold Brew Coffee, and Penn & Beech

Saint Louis - Streitwise Plaza

  • $44 million 3 building Class A Office Park
  • Located in Sunset Hills, MO - outside of St Louis, MO
  • 290,000 square feet
  • Tenants include: New Balance, Wells Fargo, Edward Jones, Nationwide Insurance, and others

So, when you invest in this Streitwise REIT you know exactly what you are investing in.

Follow this link to get started with Streitwise.

Although you do not have to be an accredited investor to participate with Streitwise, you must purchase a minimum of 500 shares. That currently puts the minimum investment at just over $5,000.

Streitwise aims to pay out quarterly dividends which are dependent upon the financial performance of the REIT. Luckily the founders have plenty of skin in the game too. Among the three founders, they hold over $5 million in the REIT.

Streitwise is a long-term investment. They have a one-year lockout commitment requirement. However, they prefer for investors to stick around for five years. After one year you can sell some of your shares but they have rules and stipulations. Like most new REITs they hope to become more liquid soon.

Streitwise also offers a 1031 Exchange. A 1031 exchange is a tax law that allows investors to avoid paying taxes on their profits when they sell an asset, as long as they reinvest the funds in a similar investment property without touching the proceeds. A third party must hold your gains in an escrow while you arrange to purchase another property within a set period.

Highlights of Investing with Streitwise

Historically, real estate prices have risen rapidly, meaning that more people are looking for investment opportunities in the space. Investors like to get into real estate because it doesn’t necessarily correlate with the ups and downs of the stock market.

You can invest in Streitwise directly or through a variety of tax-advantaged accounts. In most cases, you can hold your Streitwise investment within an IRA.

The fact that Streitwise is a REIT is advantageous for investors and owners. REITs also have tax advantages. According to law, they must return 90% of their taxable income as dividends to their shareholders. Typically, depreciation expense offsets at least part of dividend income, which is a paper expense. REIT investors can also deduct up to 20% of their dividend income through pass-through deductions. Also, when the underlying properties sell, investors have lower long-term capital gains tax rates.

Key Points

  • Streitwise is a REIT
  • $5000 min investment
  • 1 year min holding period
  • Quarterly dividends
  • Currently holds 2 large office complexes
  • There is no requirement to be an accredited investor

Pros and Cons of Streitwise

Pros:   

  • Streitwise has paid out a decent dividend
  • You do not have to be an accredited investor
  • It’s always a good time to get into real estate
  • Streitwise is transparent with what you will be owning a share in

Cons:

  • The investment is illiquid and you are locked in for at least one year
  • The $5,000 minimum eliminates many new investors
  • They only hold two properties (Indianapolis & St. Louis)

The Bottom Line

Looking for a way to invest in real estate without the hassle of buying a property? Consider investing in Streitwise’s REIT. Deciding what company to invest in can be overwhelming. Remember to take your time and always keep long-term goals in mind. Another Streitwise review can be read here.

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