Friday, February 13, 2009

Real Estate IRA - Entrust Presentation

For some starting principals and basic information on purchasing and owning real estate in your IRA, click on the presentation below that has been provided by Entrust. For a personal presentation on this subject, please contact us!

Entrust Presentation click here!

For more information about commercial and investment real estate, please visit our web site:

Monday, February 9, 2009

Real Estate in Your IRA?!

As an introduction to the next subject, below is an introductory article by Mr. Callahan:

Real Estate in Your IRA? Self Direct and Take Control!

By Jack M Callahan, J.D., CFP™

If you haven’t heard about buying real estate inside your IRA, your first reaction might be, “You can’t do that!” Despite the attention, including articles in Business Week (Nov. 18, 2002; Aug. 2003), The Wall Street Journal (Dec 18, 2002; Jan 15, 2003), and other publications, many investors today still do not realize they can invest their retirement plans into real estate. Many feel “trapped” in their stock market investments due to common misconceptions about the types of investments that are permitted within IRAs and other retirement plans.

It’s all about the Custodian
The widespread misconception that permissible IRA investments are limited to stocks, bonds, mutual funds, and Certificates of Deposits is a result of people and companies who are in the business of selling these products. The IRS requires that you have an approved custodian for your IRA or other retirement plan. The IRA custodian for the vast majority of investors is a bank, brokerage firm, or mutual fund company – the companies who are in the business of selling investment products. These custodians simply choose to limit your IRA investment choices to the products they sell. The widespread misconception is that these limits are placed on IRA investors by the IRS, which is simply not the case. The only investment types that are prohibited by the IRS rules are collectibles, such as artwork and antiques. The IRS rules allow you to invest your IRA into real estate, lend your IRA as a mortgage loan and many other investment alternatives - AS LONG AS YOU HAVE A CUSTODIAN THAT IS WILLING TO ALLOW THESE INVESTMENTS!
As a truly self directed IRA administrator Entrust of Tampa Bay, LLC does not sell any products, does not give investment advice, and does not limit your IRA investment options. With a truly self directed IRA from Entrust of Tampa Bay, LLC you are able to “Unlock Your IRA” and invest in rental property, rehabs (fix up & sell), commercial property, raw land, pre-construction contracts, lease purchases or virtually any other form of real estate. All of the income from the investment goes back into your IRA and all of the expenses of the property are paid from the IRA, all without any taxes! You find the property, you make all of the decisions and your IRA reaps all of the benefits!

Jack M. Callahan, J.D., CFP™ is an Attorney, a Certified Financial Planner™, and Managing Member of Entrust of Tampa Bay, LLC.
RE/MAX EXPERTS - Commercial Division has teamed up with Entrust to offer this great benefit to our clients. For more information on self directed IRAs and purchasing commercial or investment property within your IRA, please contact Brett Vogeler at: 863-255-1613.

Friday, January 30, 2009

Why invest in Commercial Real Estate vs the Financial Markets?

According to the Concise Encyclopedia of Economics:

The average compound after-inflation rate of return on stocks from 1802 through 2002 was 6.8 percent per year, and this number has remained remarkably steady over time. A 6.8 percent annual rate of return means that if all dividends are reinvested, the purchasing power of stocks has doubled, on average, every ten years over the past two centuries. This return far exceeds that of other financial assets.

We won't even talk about the returns (or lack there of) in the last six years!

Investment real estate has averaged 6% to 8% capitalization rates (or return on investment if you assume the purchase of a property was for cash and did not involve debt financing). Currently capitalization rates are closer to 8% and this does not include appreciation in the rate of return. If you figure 2% to 4% annual appreciation rates, the returns for investment real estate are in the double digits. Increased cash-on-cash returns can be obtained with some leverage. So investment real estate has better average annual returns than the investment in the financial markets and investment real estate has little chance of going to a value of ZERO, like financial market investments.

I once had someone ask me, "If you can show me how you can guarantee an 8% return on my money and I don't have to be involved in managing a property, I will invest in real estate." Well there is a way to virtually guarantee a return on your investment with very little effort. There are "Triple Net or NNN" investments where the tenant is responsible for all expenses and maintenance of the property and they just send you a rent check each month. These leases typically run from 10 to 30 years. As far as the "guarantee" part, you have to have the confidence in the company that is leasing the property. Confidence is needed that they will stay solvent throughout the length of the lease. So you need to do a little home work on the financial strength, history and market of the company.

One example of such a type of investment is in Dollar General properties. They can be purchased in the $800,000 and up price range with 7% to 8.25% capitalization rates. The lower return may require some owner responsibilities with maintenance versus and absolute NNN lease. This type of retail seems to be recession proof and doing well for people looking to cut expenses in the current economic situation.

For more information about how to invest, questions about terms or more details, please post a reply to this article and I will do my best to provide additional information.

You may say, "this sounds great, but I don't have $800,000 sitting in my checking account right now." Well, look for my next article it will be about how you can use that money that is sitting in your IRA and other retirement plans, earning little to nothing for the last five years. Watch for buying real estate in Self Directed IRA's.

For more Commercial and Investment Real Estate Information, please visit my web site:



Welcome to my Florida Investment and Commercial Real Estate Blog!

I hope to provide regular Posts of information and statistics relating to commercial and investment real estate that will spur comments, discussions and a greater interest in commercial and investment real estate. Please check back frequently and please add your comments and questions.

For more information on Commercial and Investment Real Estate, please visit my web site at: