multi-family real estate

Key Terms to Know When Investing in Multifamily Real Estate

A Guide to Help You Understand the Lingo You’ll Hear When Working With a Multifamily Investment Company

Worcester Investments believes that financial education is financial empowerment, and to that end, we’ve generated a list of terms that will help investors make an informed decision when they’re seeking a sponsor for a high return investment in Kansas City real estate.

When you schedule a call with our Investor Success team to explore our investment properties and find out how they can generate returns for you and your family, you don’t have to speak in financial buzzwords – and neither will we. We can meet you right where you are as a first-time investor. And, of course, if you’re familiar with investment, we’re always happy to get into the weeds to share our particular investment philosophy, and talk finance all you’d like.

Wherever your starting point, we hope these terms will clarify some of your questions about investing in multifamily properties, and position you for a more effective understanding of the high returns when investing in real estate.

Key Terms Used by Multifamily Investment Companies

Multifamily Real Estate: Multifamily properties are buildings with multiple residences for rent, such as apartment complexes. Multifamily real estate presents an opportunity to diversify one’s portfolio, especially when an investment company is committed to acquiring excellent investment properties with superior operation and management experience of the buildings in question.

Investment Products: An investment product is a security (an asset of value) that an investment company is offering. When you invest, you expect a return on that product, particularly when that company is committed to the strategic growth of that investment. In the case of multifamily investment, an investment company develops a plan to yield high returns during the time it holds a property.

Passive Investment: When a person invests passively, they intend to hold the investment for a long enough time to see their returns grow – as in a mutual fund – without having to actively watch the short-term blips of market fluctuation.

Accredited Investor: An accredited investor is a person, couple, or business entity who is allowed to trade securities based on certain requirements outlined by the U.S. Securities and Exchange Commission (SEC). These requirements, among others, include income and net worth. Multifamily investment is accessible to accredited investors.

Generational Wealth: Generational wealth is any asset passed down to the next generation. This can be in the form of an inheritance or gift, and can include stocks, bonds, and other investments. The idea is that wealth accumulated through investment can empower the next generation’s financial decisions, compounding assets and returns. A strong multifamily investment firm is committed to helping our investors access generational wealth.

Direct Equity: When an investor decides to invest in a particular project with a professional investment partner, this is called a direct equity investment, as the security being invested in is specific – or “direct.” This can be a valuable way to invest when an investment company has a track record for acquiring and managing projects that will yield an excellent return. For instance, Worcester Investments can provide details on specific properties with high growth potential.

Investment Fund: A fund brings together investments from a number of investors, and which are managed by a sponsor, such as Worcester Investments, a multifamily investment company specializing in Kansas City real estate.

Historic ROI: ROI, or return on investment, is itself a popular term, used to describe how well an investment has performed. Often expressed as a percentage, it calculates to what degree returns have risen above the initial investment. Historic ROI refers to historical (past) data of investments in order to offer a prediction of future returns. Working with an experienced multifamily real estate company can yield high return investments, and these companies, therefore, boast a significant historic ROI on their investment properties.

Worcester Investments, a Multifamily Investment Company, Offers a Better Investment Experience

A great investment experience begins with a trusting relationship and a track-record that exceeds expectations, while looking to the future of investment practices. The deals Worcester Investments has made in Kansas City real estate are second-to-none, and we want to show you why – and how you can get your foot in the door.

If you’re interested in chatting about your financial goals for your family, getting your questions clarified about multifamily real estate investment, or learning more about how Worcester Investments can add value to your accredited investor’s portfolio, we’re here to listen.

Start a conversation with our Investor Success team today by sending us a message online, or by giving us a call at (816) 759-0901.