An investor from Northern California shares how he and his wife evaluated Equity Residences Platinum Fund. He also discusses some of his traveling experiences as a Platinum Fund investor.
Karthik says they were “looking to build great memories” with their 10- and 15-year-old children when this Northern California family first considered their investment options:
"We thought about buying a second home. We quickly ruled that out. For one, the maintenance costs and the hassles associated with that. And for another, it hooks you into a particular location. We looked at other luxury vacation clubs, and I didn’t like them from the investment decision. They had either massively high upfront initiation fees or high annual dues. Or they had really high pay-per-day rates for getting access to new homes."
After Karthik and his wife ruled out the first investment possibilities they considered, they chose the Equity Residences Platinum Fund. However, they did at first have some reservations about making this investment move as he notes:
"These were our two primary reservations: Can you go into a quality set of homes, and how secure is the investment model? And our experiences have been phenomenal so far. If you are flexible, you have a great set of options through the Platinum Fund."
Karthik gives examples of some of his questions about the Platinum Fund opportunity:
"How secure is your investment? How good are the operators? Are we going to get the investment back?"
And then goes on to answer his own questions in a general overview, saying:
"It’s a private equity model: The general partners get paid after the investors get paid. When they liquidate the fund 10 years after the investment period, 80 percent of the profits go to the investors and remaining 20 percent goes to the general partners. I think that’s fair. Our incentives are aligned. Number two is they have a phenomenal track record and experience with the Equity Villa Fund."
He then further explains Platinum Fund investments and refers to the two Managing Directors, John Long and Greg Salley:
"If you’re comfortable investing in real estate, I think it’s a great option. It’s investing in a diversified portfolio of real estate assets. And Greg and John seem to be really smart about how they identify and pick up these assets."
Providing some insights into his travel ventures via this program he says:
"We have been able to travel with friends. We have been to our Tahoe home in Northstar. Over Spring Break, we went through Third Home (affiliate) and stayed in London. It was a darling two-bedroom apartment in the heart of Kensington. We are delighted. We really changed our lifestyle. Coming back from Hawaii, my wife turned around and said, ‘We could not have had made a better decision than investing in the Platinum Fund.'"
Karthik then concludes with how the Equity Platinum Fund has changed their family’s life:
"Before, we used to vacation in hotels. We found that we were at a point in life with the kids growing bigger, and that [we] would want to travel with friends, and we would love to stay in homes. And I have to say we’ve been punching a bit above our weight: Great homes that rent for several thousands of dollars a night."
The full interview is in the video above.