Investing in multifamily real estate remains a lucrative way to generate passive income, and Trion Properties has a long, 17-year successful track record for doing just that for high-net-worth individuals. Read my Trion Properties review to find out everything you need to know about this service.
What Is Trion Properties?
Trion Properties is a multifamily real estate investment sponsor, offering commerical real estate investment opportunities in direct deals as well as its multifamily fund to accredited investors.
The company is vertically integrated: meaning it acquires multifamily properties, renovates them, then manages them.
Trion often targets a very specific niche of older buildings that can be cost-effectively enhanced to meet comparable properties in the vicinity. Once renovations are complete, Trion also serves as property manager.
Depending on the property and debt, investors can invest in the individual deal. Investment commitments are only open for a small window of time.
Then these properties are rolled into a fund, allowing investors to buy into a group of properties (usually 10-16) around the country in western and southern states in high-growth markets.
This allows investors to further mitigate their risk. The long-term goal is big profit through property sales.
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Trion Properties invests solely in multifamily real estate.
Its acquisitions are typically poorly managed and kept buildings, allowing the Trion team to acquire properties at a discount and often off-market. More often than not, the properties have remained untouched for ten-plus years.
Due to a very stringent underwriting process, each property is chosen for its strategic location in communities tagged for up-and-coming growth. Before any offer is made, the team examines factors like population growth rates and rental demand.
Most importantly, real estate selections must have the potential to thrive even when the economy is subpar.
After the acquisition, the company converts these properties into affordable apartments for tenants.
The company leverages that vertically integrated approach, overseeing the entire process from beginning to end. This provides the freedom to customize each property based on the needs of the community.
Through renovations and hands-on asset management, these multifamily locations become prime places to live.
This helps achieve higher rental value and keeps vacancies to a minimum.
Collecting rent from tenants is a stable source of income, but it’s not the endgame.
Buying low upfront keeps investor costs down, but it has an even bigger long-term benefit.
After holding acquisitions for a handful of years, the company capitalizes on its hard work and sells high.
Profits from the sale find their way back into the pockets of investors.
Trion Properties has been in business for 17 years and clearly has its business model figured out.
In that time, it has closed on 73 properties, resulting in over $1.8 billion in transactions. One billion of that remains in current assets under management.
While holding properties, the team focuses on maximizing investor returns by increasing net operating income.
And the investment company puts its own money into every purchase, so you know it has a vested interest.
Since its inception, Trion has generated an average internal rate of return in excess of 25%.
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Do you Need to Be an Accredited Investor to Join?
Yes, you must be an accredited investor to join Trion Properties.
To qualify, you’ll need to meet one of three criteria:
- Have the right professional credentials. Common options are to hold a Series 7, 65, or 82 license in good standing from the Financial Industry Regulatory Authority (FINRA).
- As an individual or couple, you must have a net worth of at least one million dollars at the time of investment. This amount excludes your primary residence.
- Your annual income surpasses the $200,000 mark ($300,000 as a couple) for at least two years straight. It should be clear that you can maintain this income during the current year.
What Is the Typical Holding Period?
A typical Trion Properties asset goes through a two-phase holding period. The first begins at acquisition with a careful property analysis and repositioning plan.
In most cases, the step takes around 18 months. So you’re looking at a long-term investment horizon before income has the potential to start floating back your way.
Once properties are ready for rental, the team plans for anywhere between three and five years of stable operation.
During this time, you have the potential to earn income off dividends. At the end of the window, they set out to sell the asset for beaucoup bucks.
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Expertly Vetted Opportunities
The crew carefully targets markets where real estate can be successful in good times and bad.
They look for areas of sustainable growth with the right mix of economic conditions to keep properties occupied for the long term.
The team then scours the market for the ideal building, one largely untouched for several years. This gives them the freedom to maximize the space for tenants and the value for investors.
They are not afraid to hunt down the perfect location, even if it’s not currently listed for sale.
If you’ve ever owned a real estate property, you’ve likely taken an active approach.
This means doing the hands-on management and maintenance required to turn a profit.
Active investing can prove fruitful but requires a great deal of work.
This isn’t the case with Trion Properties.
Investments are designed to provide the opportunity for high-yield passive income. You provide capital toward real estate property and let the professionals take care of the rest.
Many properties require heavy rehab, so your investment goes toward making the place appealing to tenants. The team takes care of this process and also adds their own money.
Since properties are passive investments, you don’t have to deal with buying, property management, or selling down the road.
The income you make comes from regular dividends carved from tenant rent. When the property sells, you could benefit from price appreciation due to those extensive renovations.
Private Real Estate Investment Funds
Trion Properties invests exclusively in multifamily real estate.
These funds comprise a pool of properties purchased by a private equity investment company.
This is different from a real estate investment trust (REIT), which is a public corporation offering opportunistic real estate investments.
Being private, not everyone can take part. Involvement is limited to accredited investors.
Each private real estate investment fund contains a number of multifamily properties.
The reason behind choosing funds over REITs is simple.
The Trion team believes purchasing multifamily properties to renovate and manage has the highest rate of return of any real estate option out there.
Multifamily Opportunity Fund IV
Trion Properties is launching a new fund targeting $100 million in equity in Q1 2023.
As the name suggests, the fund provides the opportunity to invest in multifamily apartment complexes.
Here are some of the main benefits:
- Early “seed investors” will receive preferred economics
- Anticipated to acquire 12-18 properties over its investment period
- Targets investor-level annualized returns of 12% to 15% over a six to eight years
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Is the Service Legit?
Trion Properties is a legit business with over 17 years of buying and selling multifamily properties.
The fund programs provide a real opportunity to receive passive income through its portfolio of carefully vetted real estate.
Also, as mentioned, this team has generated an average internal rate of return in excess of 25% since 2005.
Pros and Cons
The service has a lot going for it, but it’s not perfect. Here are the pros and cons.
- 17 years of experience
- Buildings renovated, maintained, and managed by the company
- Actively invests capital in each property
- Passive income opportunity for investors
- Low-risk investment strategy
- Available solely to accredited investors
- Only deals with large, residential properties
Is the Service Right for Me?
Funds at Trion Properties are best suited for people wanting to take a passive approach to real estate.
After laying down that initial cash to get on board, the team handles everything else.
You’ll need to be in it for the long haul, though, as most properties have an 18-month reposition.
While you have the potential to receive dividends from rental income, the final goal is the sale of each property in the fund.
The good news is that the company has already had a lot of success in this area. Its own rate of return is higher than 25%.
This may sound like a slam dunk to you. However, only accredited investors can take part.
What’s more, the company doesn’t disclose any costs for getting involved. It stands to reason though that entry requirements will not be cheap.
Is Trion Properties Worth It?
Trion Properties is a great service worth checking out.
The team’s take on real estate investing is like none other. This company may not be the first private real estate sponsor out there, but its laser focus on older multifamily residences offers a unique angle on the market.
The firm takes responsibility for all aspects of the program, from acquisition to final sale. And the team invests its own time and resources into every location to maximize the potential for returns.
As a private opportunity, investments aren’t exposed to the rigors of market fluctuations.
By design, this approach reduces risk.
You will need proof of investment accreditation though to have any hope of getting involved.
If you fit the bill, partnering with Trion Properties has all the makings of a solid investment strategy.
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