SVSM Growth Fund I LP
SVSM Growth Fund I LP invests in a combination of real estate notes and undervalued properties. The real estate notes have terms of up to 60 months and are generally written at a maximum of 75% of the value of the real estate collateral. The Fund also invests in undervalued properties that can be sold off at a profit. At this time due to the real estate market cycle, the Fund is mostly invested in real estate notes, and as property prices drop, investment in undervalued properties will increase.
We recognize that many investors do not want to tie up funds for a long period of time, therefore the Fund has a very short lock-up period of 12 months. A minimum investment of $50,000 is required to enter the Fund, with subsequent minimum investments of $5,000. Distributions pay out monthly with the ability to reinvest earnings, and investors receive monthly statements. The target annual return for SVSM Growth Fund I LP is 6-8%.
SVSM Growth Fund I LP is available to accredited investors only.
Overview of Investment Terms
Minimum Investment Amount – $50,000
Subsequent Minimum Investment – $5,000
Management Fee – 1%
Performance Bonus – 20%
Distributions – Option to take monthly cash distributions or reinvest earnings, thus increasing annual yield through compounding
Minimum Lock-Up Period – 12 months – Principal withdraw after 1 year subscription with a 90-day notice
Target Annual Return – 6-8%
*This is not a solicitation for any type of investment. Before investing, a prospective investor must read the Fund’s Private Placement Memorandum (PPM) and seek advice from their financial, tax and legal professionals. An investment in the Fund or in a note requires verification of the prospective investor’s status as an accredited investor pursuant to Rule 506(c) promulgated under the Securities Act.
What is an Accredited Investor?
To claim accredited investor status, you must meet at least one of the following requirements:
- Have a net worth exceeding $1 million individually or combined with a spouse (excluding value of primary residence).
- Have earned income exceeding $200,000 ($300,000 if combined with a spouse) during each of the last two calendar years.
- The individual must also demonstrate credibility that he or she will at least maintain these income thresholds during the current year.
It is important to note one specific rule about this last point – the individual must meet these income requirements based on the same method for all three years: single or joint.
Entities can also claim Accredited Investor status
The SEC defines accredited investors in Section 501 under Regulation D. The following entities that meet the requirements outlined in this document can claim accredited investor status.
- Brokerage firms
- Employer-sponsored retirement plans
- Certain trusts
- Registered Investment Advisor (RIA) firms
- In certain situations, an individual can gain approval to buy unregistered securities if he or she can prove experience and education in the financial markets, particularly around unregistered securities
For more information and a more detailed definition visit www.sec.gov
Our Fund managers take advantage of the best assets available at any given time. The goal is to yield the highest returns at the lowest risk. These assets include real estate notes, houses, apartments, and commercial real estate assets.
Attention to the Market Cycle
We invest while keeping a close watch on the market cycle. Real estate sales volumes and prices fluctuate greatly over time and different asset classes fluctuate at different times as well.
Knowledge and Experience is Key
Knowing the market cycles and having over two decades of experience and knowledge in these cycles allows us to invest wisely.
What We Invest In
The Fund is structured to invest in real estate lien notes secured by investment properties having a maximum loan to value up to 75%. The Fund also invests in physical assets such as houses, apartment complexes, and other commercial assets holding a 30% or greater equity position, or a cap rate greater than 10%. Most private equity funds available to investors are limited to either notes or physical assets. Our unique design allows us to purchase assets when the prices are low and sell when prices are high. We believe this allows us to produce a consistently high yield for our investors at all points in the market cycle while minimizing risk.
Q: How long has SVSM Capital LLC been managing funds?
A: The general partners of the Fund have been managing note funds since 2014. The SVSM Growth Fund I LP, created in 2022, allows investors to take advantage of the returns note funds offer.
Q: What is the minimum investment?
A: The minimum investment for SVSM Growth Fund I LP is $50,000. Subsequent investments are allowed at any time, at a minimum of $5,000.
Q: What is the initial lock-up period on the Fund?
A: The initial lock-up period on the Fund is one year.
Q: Is this an open-ended fund?
A: Yes, this Fund is open-ended, also known as an evergreen fund. We calculate Net Asset Value (NAV) on a semi-annual basis and allow investors to subscribe and redeem at the current share price.
Q: Is this a passive investment?
A: Yes, investing in this private fund is completely passive. When investing in a private fund, you are leveraging our management company’s experience in this business and participating in a diversified portfolio.
Q: How often does the Fund pay out?
A: The Fund pays out monthly.
Q: Can I compound my earnings?
A: Yes, you have the option to allow your funds to work twice as hard for you by reinvesting and compounding on a monthly basis.
Q: Will I own a specific note?
A: If you invest, you become a part owner of the Fund versus owner of a specific note. Therefore, your capital is diversified across all the notes in the portfolio.
Q: Do I need to be an accredited investor to invest in the Fund?
A: Yes, you must be an accredited investor to invest in SVSM Growth Fund I LP.
Q: Can I invest with an IRA or 401K?
A: Yes, our Fund allows investments through qualified retirement money. This must be done through a self-directed IRA or 401K. If you do not yet have a self-directed account, we can make introductions to several custodians that we have worked with.
Q: How will investing in these funds affect my taxes?
A: Investors should consult with their trusted accountants and attorneys to ensure they understand all tax implications prior to investing. We provide each investor with a K-1 form for tax purposes.