FAQs

A: Commercial properties on the average have higher returns. Their advantages are that you have higher quality tenants, longer term leases, and more predictable income. Also, most are NNN (triple net) which means that the taxes, insurance, and maintenance costs are passed on to the tenants.

1. Filter for the following parameters:
   • Highest CAP rates
   • Highest potential for actual vs. virtual returns
   • Potential for appreciation and rent appreciation
     • Population growth & inward migration
     • Employment growth
     • Cost of living
     • Political support of business and development

1. Office
   • Single Tenant
   • Multi-Tenant
2. Retail
   • Power Center
   • Regional Shopping Center
   • Neighborhood Retail Center
   • Strip Centers
3. Industrial
   • Single and multi-tenant
   • Manufacturing
   • R&D
   • Warehouse / distribution

Risk tolerance Commercial Real Estate deals tend to run the gamut of risk/reward. Low risk investments are typically stabilized assets that have conservative leases and tenants in place close to or at full occupancy. These are usually longer hold periods and are sometimes referred to as “mailbox money”, with a secure dividend check every quarter. Other deals are “value add”, which take on more risk to make substantial improvements to a property, typically increasing both occupancy and rents. Development deals also offer attractive returns at higher risk, and can encompass land entitlement, construction, and operation of a new facility.

Desire for passive investments As an investor you take a passive role in the ownership of real estate commercial investments. Investment companies set up full property management, handle taxes, finances, accounting, and an investor simply receives predetermined profit splits. It also has the advantage of limiting liability to amount invested due to passive nature.

Cash flow vs appreciation Lower risk deals tend to have more stabilized values but produce cash flow over long terms that help meet investor cash flow goals. Appreciation and value add deals can generate a large profit but take on more risk to attempt those objectives.

A: Yes. Shares qualify for the Share Repurchase Program, as described in the Prospectusbut this program is subject to limitations discussed in the prospectus.

A: Generally, distributions that you receive will be taxed as ordinary income. We expect that some portion of your distributions may not be subject to tax in the year received due to the fact that depreciation expenses reduce taxable income. This defers a portion of your tax until your investment is sold or liquidated, at which time under current tax laws you will be taxed at capital gains rates.

A: CRE Income Fundwill provide you with monthly updates on the performance. Additionally, your Form 1099 tax information will be mailed on or around January 31 of each year.

A: The minimum investment in CRE Income Fund is $10,000.

A: Your risk and liability are always limited to the amount of your original investment.

A: An IRR factors in the net present value of all monies that go into and out of the investment including capital and cash flow. It is the most objective way to compare two investments. The IRR typically is slightly lower than the Average Annual Return because the profits at the end upon sale have a lower net present value than monies that are spent at the beginning of an investment.

• LLC owns property
• Investors own shares in the LLC
• Management is a separate LLC that has all of the liability
• Investors have no liability beyond their investment
• Managers have all responsibility in managing the property

A: Yes. The CRE Income Fund charges a 1% management fee

A: From the following components:

• Sponsor fees at close to cover our costs to filter and vet the best deals.
• Loan fees to qualify and guarantee the loan

• A percentage of the profits at the sale after the lender is paid and the investors original capital is paid back, and after all of the preferred returns are paid.

A: Yes! The Employee Retirement Income Security Act (ERISA) of 1974 passed the responsibility of retirement saving from the employer to the employee. Created in 1975, IRAs provide individuals a chance to direct where their retirement funds are invested. The IRS code, instead of distinguishing which investments are allowed, identifies which investments are not permitted under these laws. Under both ERISA and IRS Codes, there are only two types of investments excluded: life insurance contracts and collectibles such as works of art, rugs, jewelry, etc. Refer to Internal Revenue Code Section 401 (IRC § 408(a) (3)).

A: The unique thing with IRAs and 401(k)s are the tax advantages. Most contributions are either tax deductible as is the case of a Traditional IRA or 401(k), or the distributions are tax free as in the case of a Roth IRA or Roth 401(k). There are no unique rules for self-direction.

A: You can self-direct the funds by rolling over your account into a traditional IRA or a qualified plan (if you are eligible to have a qualified plan) that permits complete self-direction. Contact your former employer’s plan administrator or benefits department to determine what, if any, special procedures may be required.

If you are still employed, check with your current plan administrator to determine if self-direction is currently allowed within your plan or if this option can be added.

A: Most employer-sponsored plans, like 401(k) do not let you roll your account into a new vehicle while you are still employed. Some employers, however, do allow you to roll a portion of your funds. To be certain, contact your current 401(k) provider.

If you can roll your funds into a new account, here is a list of the types of accounts that are eligible:

• Traditional IRA
• Roth IRA
• SEP IRA
• SIMPLE
• Individual(k)
• Health Savings Accounts
• Coverdell Education Savings Accounts