Ascent Income Fund & Alpine Note Sample Starter Portfolios

Introduction

EquityMultiple offers three pillars of wealth creation to help you build a more diversified portfolio. Keep, Earn, and Grow bring you real estate investments offering a blend of cash management, income focus, and total return/appreciation focus. Alpine Notes and Ascent Income Fund are evergreen investment options, flagships of the and pillars, respectively. Both investments may be great places to begin investing with EquityMultiple, as they offer a low barrier of entry and are always available.

But what kind of return profile is achievable with one or both of these investment vehicles? This brief case study shows the type of strategy an investor may adopt in allocating to a blend of Alpine and Ascent positions over three years. These sample portfolios show that a blend of the two can potentially offer attractive yield and flexibility to redeploy capital — an appealing attribute given the fluidity in today’s capital markets.

Sample Starter Portfolios

Conclusion

Through a comparison of the 6 sample starter portfolios, you’ll notice that a hybrid approach offers the best net IRR, while the “buy and hold” strategy offers the most total profit. A more liquid approach offers maximum flexibility of investor funds.

Laddering maturities of Alpine Note positions can help to:

• Guard against inflation: While the yield of Alpine Notes potentially offsets inflation directly, having flexibility to liquidate at different moments offers options — the ability to compound further or roll over into a higher-rate fixed-income product or into a real estate (like multifamily) that may capture inflation in asset appreciation
• Stay nimble for future opportunities: Though we don’t know where the bottom is with respect to the real estate market cycle, we expect some degree of distressed opportunity to emerge as bid/ask spreads narrow and capital markets equilibrate. Rolling maturity dates help achieve “temporal diversification” and the ability to stay nimble.
• Provide diversified rollover options: EquityMultiple offers diversified investment flow across the capital stack, across markets. More points of exit can bring more opportunity to curate your real estate portfolio, especially amid fluid market conditions.

In conclusion, all six strategies offer compelling scenarios for blending Alpine and Ascent positions, depending on individual investor preferences for liquidity, hold period, or return profiles. Both the Ascent Income Fund and Alpine Note Series bring you flexibility to react should market conditions change.

FAQ’s

Can I redirect capital from an Alpine Note investment into another EquityMultiple investment?

Yes, after 30 days from the close of your Alpine Note investment.

Why would I want to invest in a 6-month note if I can invest in a 3-month note (and potentially compound for six months) instead?

The APY of a 6-month note over any duration exceeds that of 3-month notes reinvested over an equivalent period. For example, $100k invested in a 6-month note would earn roughly $500 more than $100k invested in a 3-month note and rolled over into a second three month note.

What are my redemption options for the Ascent Income Fund? Are there fees to redeem early?

You may redeem capital from an Ascent Income Fund investment as soon as one year after close of your investment. There is a 4% fee for early redemption after the first year, up until two years post-close of your investment.

Why would I invest in 3 and/or 6 month notes when putting my full Alpine Note allocation into a 9-month Note would result in more total returns?

Ultimately the decision is between more flexibility versus slightly higher overall return. Scenario 1 above offers a very similar return profile to Scenario 5. However, Scenario 1 offers more opportunities to reclaim capital throughout the three-year term (for day-to-day liquidity needs or to redeploy for an opportunity off of EquityMultiple). Scenario 5 offers a slightly higher overall return over three years.