More flexibility, fewer fees, and better returns—discover how a customizable fund with Cereus Real Estate can streamline your real estate investments.
The Evolution of a Smarter Investment Model
Picture this: You’ve worked hard, saved diligently, and now you’re ready to invest in real estate. You start small—one deal, one investment portal, one K-1 tax form. But as time goes on, you diversify, and suddenly, you’ve got 20 different investor portals to log into and dozens of K-1s to chase after come tax time..
But what if there was a way to streamline your real estate investments? Enter the Customizable Fund Structure—a flexible, hybrid investment vehicle that takes the best of syndications and real estate funds while eliminating the inefficiencies of both models.
As the founder of Cereus Real Estate, I saw this problem firsthand. After our proof-of-concept year, where I helped over two dozen investors direct more than $1.2 million of capital, it became clear: There’s a real hunger for smart, passive real estate investing. But we needed a better way to do it.
That’s why I structured Cereus Real Estate’s investment model as a customizable fund, designed to offer greater flexibility, efficiency, and profitability for investors like you.
Want more details? Read on!
Traditional Syndications: The Good, The Bad, and The Ugly
If you’ve ever invested in a real estate syndication, you know how it works:
- You evaluate a specific deal.
- You review and sign a Private Placement Memorandum (PPM)—a long legal document that outlines the investment details.
- You invest your money.
- You wait. If the deal goes well, you collect cash flow and eventual profits.
- At tax time, you receive a K-1 tax form for the deal.
Now, imagine you invest in 30 deals over time. That means 30 different PPMs to sign, 30 different K-1s, and a multitude of different investment portals to log into. It’s not just tedious; it’s an absolute headache when it comes time to file taxes.
The Traditional Real Estate Fund: A One-Size-Fits-All Problem
To avoid this mess, some investors turn to real estate funds. A typical fund works like this:
- You invest your money into a blind fund, meaning you don’t pick specific deals—you trust the fund manager to decide for you.
- The fund manager takes your money and invests it in multiple properties.
- You get exposure to several deals, but you have zero control over where your money goes.
This model works well for people who don’t want to be hands-on with their investments. However, for those who want control over which deals they participate in, a traditional real estate fund can feel like a gamble.
The Customizable Fund: The Best of Both Worlds
So, how does the customizable fund solve these problems?
1. One Fund, Multiple Deals – But You Choose
With a customizable fund, you join once by signing a single Private Placement Memorandum (PPM). After that, you gain access to individual investment opportunities within the fund. You decide which deals you want to participate in—no blind investing required.
For example:
- You see a deal for a high-end apartment complex in Austin. You like it. You invest.
- Another deal pops up for a self-storage facility in Phoenix. You’re not interested. You skip it.
You get to customize your portfolio, all under one investment umbrella.
2. Simplified Tax Reporting
Instead of receiving a separate K-1 tax form for each deal, you’ll receive just ONE K-1 from the fund, regardless of how many deals you’ve invested in. That means:
- Less paperwork
- Fewer headaches at tax time
- A happier CPA (and possibly a smaller tax prep bill)
3. One Portal for All Investments
Rather than juggling multiple investment portals, you get one login to track all your investments under Cereus Real Estate. Every deal, every financial statement, and every distribution—all in one place.
4. Lower Fees = Higher Returns
Every syndication deal requires expensive legal paperwork, including PPMs, which can cost between $10,000 to $20,000 per deal. Guess who ultimately pays for that? The investors.
With the customizable fund, we spread out legal costs over multiple deals, meaning more money goes into actual investments rather than lawyer fees. Lower fees = more profit in your pocket.
5. Easier Capital Deployment
In traditional syndications, when a deal closes, you receive a check. If you want to reinvest, you have to:
- Deposit the check into your account.
- Find another deal.
- Wire the money back out.
With the customizable fund, proceeds from one deal can be seamlessly rolled into the next deal, making reinvestment easier and more tax-efficient. Plus, rolling capital into new deals can help defer taxes on gains, maximizing your long-term wealth.
6. Better Deals, Better Returns
Big checks attract big opportunities.
Let’s say you invest in a syndication as an individual. You might get a 70/30 split (where 70% of profits go to investors and 30% to general partners) with a 6% preferred return.
But when Cereus Real Estate brings in a $1 million check instead of 20 smaller individual investments, we can negotiate better terms, such as:
🔹 A more favorable split
🔹 A higher preferred return
🔹 Potentially lower fees and better financing terms
By pooling investor capital, we increase profitability for everyone in the fund.
What’s the Catch?
Of course, nothing is perfect. Here are a few potential downsides of the customizable fund:
1. Accredited Investors Only
To invest, you must be an accredited investor, which means:
- $200,000+ annual income ($300,000 if married) or
- $1 million net worth (excluding your primary home)
Fortunately, most physicians and high-income professionals qualify. If you don’t, it’s time to negotiate that contract!
2. More Complex Fund Administration
Tracking multiple deals inside one fund requires sophisticated accounting. That’s on me—I’m selecting an investor portal that ensures everything is tracked correctly.
3. K-1s Might Take Longer
Because all investments are consolidated into one K-1, we need to wait for every individual deal to send us their K-1s before finalizing yours. This may mean filing an extension with the IRS—but trust me, I’ve been doing that (legally) for years, and it’s no big deal.
Final Thoughts: A Smarter Way to Invest
If you’re serious about real estate investing but want:
- Control over your investments
- Fewer tax headaches
- Better deal terms
- Lower fees and higher efficiency
Then the customizable fund structure is the way to go. This model lets you scale your real estate investments without the administrative hassle that typifies syndications.
Want to learn more? Check out Cereus Real Estate to start your journey to financial freedom.
Financial freedom isn’t a dream—it’s a decision. Let’s get there together.
Daniel Shin, MD
The Darwinian Doctor
Experience the financial benefits of real estate without dealing with the headache!
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