A key term to a real estate private equity deal is the sponsor “promote”. This term is really just industry jargon for the sponsor’s disproportionate share of profits in a real estate deal above a predetermined return threshold. In this article, we will define the sponsor promote, explore how promotes work, explain how they are justified as well as how they benefit both sponsors and investors and, finally, what they mean to investors under a direct-to-investor model.
Articles in this section
- What is a Real Estate Sponsor Promote?
- What are the Differences Between Direct and Indirect (REIT) Real Estate Investments?
- What is a Cap Rate?
- What is a Cash-on-Cash Return?
- How do I become a Sponsor on the CrowdStreet platform
- What is CrowdStreet's vetting / screening process for sponsors
- Where can I find sponsor track record & past performance information
- Who is allowed to invest through CrowdStreet?
- When and how are distributions dispersed?
- What is a Preferred Return?