As he walked his company’s newest rental townhouse community still under construction in Blaine, Kaeding said he believed there are plenty of nonaccredited investors who would want the chance to make money on tangible real estate projects they can see and even rent out, if they liked.
For as little as $10,000, people can invest in the $33.5 million, 74-unit Foxtail Hollow development, scheduled for completion this month. It is the first project Kaeding Development is offering to investors through its real estate investment firm, Auor Capital. After the development leases out, the plan is for the Blaine project to go up for sale with Auor and its investors splitting the profit.
“We believe this investment exists, this type of investor exists,” Kaeding said, as he showed a model townhouse unit with quartz kitchen countertops and walk-in closets. “We believe there are people out there that are nonaccredited that would love to have real estate in their portfolio. And to that end, we are working very hard to prove that idea.”
Through Auor, people can invest in single-asset offerings like Foxtail so they become direct equity owners in the LLC that owns the real estate, similar to how a real estate limited partnership runs. In the future, investors would start investing before building a project.
Returns on investments in general are never guaranteed, so potential investors should be prepared for a host of different outcomes.
Kaeding cautioned people shouldn’t use their rainy-day savings to invest and should participate in the educational seminars Auor offers to see if the program is right for them.