Answer
Feb 13, 2025 - 11:30 AM
Great question. That is going to depend a lot on the type of real estate that you're investing in. So if you go into multifamily or self-storage or hospitality, any of the asset classes where the average lease period of the units is measured in months or weeks or even hours in a hotel, then you can have the potential to have, again, the potential to see a pretty steady increase over time in that net operating income because the whole idea of a lot of these properties is to position themselves to be able to increase the rents over time and those increased rents translate into higher distributions over time. On the other hand, you might invest in a DST that is a collection of single tenant triple net lease properties where there's only a rent bump once every five years on that lease. And so you might see only minor incremental increases by design because of the nature of those leases. So I don't mean to say it depends, but all of the programs that we work with have projected net operating income at the property level going up over time. How much of that you'll receive and increase distributions entirely depends on the type of property and more specifically the lease structure of those properties and the opportunity to pass on those rents over the course of the program.
