Alternative Investments

Real Estate Investment Trusts (REITs), Business Development Companies (BDCs), and other specialty and hybrid investments are available for select clients who meet specific requirements in order to consider them as viable options.   An appropriate proportion of an investor’s wealth portfolio may be allocated to alternative investments, but will vary greatly from investor to investor based on individual investment objectives, income level, tax position, liquidity needs, risk tolerance, and possible accredited status.

The marketplace is ever-changing, and we review new products according to our due diligence standards, to stay at the forefront of investment opportunities.

Real Estate Investment Trusts (REITs)

REIT Basics

A REIT is a company that owns and manages a portfolio of real estate properties. Like a traditional stock mutual fund, REITs offer investors the opportunity to buy shares of fractional ownership in the entire portfolio. However, unlike traditional stock mutual funds, REITs are obligated to distribute 90% of their taxable income to shareholders every year. REITs can focus their portfolio on specific geographic regions or categories of property. REIT income comes from revenue generated by the properties.

Advantages of Investing in REITs

  • Diversification away from stock market risk
  • Access to real estate markets through a portfolio of properties
  • Low initial investment required compared to purchasing property individually

Investors Who May Want to Consider Investing in REITs

  • Investors who want access to real estate markets
  • Investors looking for diversification away from stock market risk
  • Dividend-oriented investors

What Northland Provides

  • Access to various real estate-focused investment companies who are committed to quality properties and income strategy objectives
  • Experienced investment professionals to guide you through your options

Business Development Companies (BDCs)

BDCs make investments in private or thinly-traded public companies in the form of debt or equity capital, with the goal of generating current income and/or capital growth.  They are investment vehicles which allow individual investors the opportunity to invest primarily in the debt or equity capital of middle market companies, an investment strategy which has predominantly only been available to institutional and high net worth individuals through private, non-traded vehicles.  BDCs afford qualified individual investors the opportunity to invest in this area with the benefit of increased transparency and governance of a public investment.

Other specialty and alternative investments — such as oil & gas partnerships or leasing programs — are available, depending on the investor’s experience, financial profile, risk tolerance, and accredited status.

The presentation of this material is neither an offer to sell nor a solicitation of an offer to purchase any investment or security. These investments are offered by prospectus, which provides detailed information, including investment specifics, fees, and expenses. This material must be read in conjunction with a prospectus in order to fully understand all the implications and risks of an investment. Individual suitability should be determined before purchasing any investment. Some specialized investments are not suitable for all investors; an investment profile will help to determine appropriate portfolio options. A diversified portfolio is no guarantee of safety of principal and investments are subject to fluctuation and possible loss of principal.

An investment in a non-traded BDC is not suitable for all investors, as it is considered speculative and involves a high degree of risk, including the risk of a substantial loss of investment.  Because shares are not listed on a securities exchange and no secondary market is expected to develop, it will be difficult to sell shares of a non-traded BDC.