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Origin Investments Review: Fees, Services and More


Origin Investments offers bundled real estate investment opportunities for accredited investors only. If you have extensive experience or the wealth to meet this category of investor, Origin Investments might be an option. Otherwise, they’re little more than an interesting way to see another part of the marketplace in action. Ordinary, retail investors have numerous opportunities to invest in real estate, and a financial advisor can lay those out for you.

Origin Investments Services and Features

Origin Investments offers bundled real estate investments made up of properties in which the firm has purchased an interest. The specific ownership or interest stakes vary based on the individual property, with Origin Investments owning equity in some properties and purchasing the debt of others.

Each fund posts returns based on the collective performance of all the properties that make up that portfolio. As an investor you buy shares and, as with any other fund-based asset, your returns are based on your pro-rata ownership of the overall fund.

In this way, the product that Origin Investments offers is similar to a real estate investment trust (REIT), although the firm operates under an LLC structure rather than as a REIT. While the difference in these two business models is complex, ultimately it means that an investment with Origin has different tax implications and receives less regulatory oversight than most REIT portfolios would.

Origin Investments focuses exclusively on multifamily residential real estate, which typically means apartment buildings and similar properties. At the time of writing, it offers two funds: the QOZ Fund III and the IncomePlus Fund. The firm’s affiliate partner, Origin Credit Advisers, also has a fund known as the Strategic Credit Fund. Origin Investments additionally advertises that investors can periodically access individual properties and similar opportunities outside of these two funds as they arise.

This firm does not crowdfund its investments. It makes all of its purchases with its own money, seeking investors based on the portfolio as built. If you invest in an Origin fund it will already own all of the properties advertised. It uses investor money to make additional purchases going forward.

Unlike many of the products that we review here at SmartAsset, Origin Investments is not a trading platform. Instead, it is a financial assets firm that allows investors access to a very specific segment of the market.

The difference is in how a firm offers investment opportunities. An investment platform is, ultimately, a tool that investors use to make their own choices about financial products offered primarily by third parties. For example, through a product like E*TRADE or TD Ameritrade you would select stocks, bonds, options and other assets to buy and sell as you see fit.

For example, E*TRADE itself doesn’t offer the stocks and bonds in your portfolio. Instead, the platform would provide you access to those products and the tools you need to trade them, while the brokerage underlying that platform would execute the deals. In other words, for an investment platform, technology is the point. The core product is the set of online tools that you use to make your investments.

A financial asset firm like Origin Investments, on the other hand, exists to offer the financial products that it creates. As an investor, you have few or no options to choose from, because the firm doesn’t support a marketplace of choices. While most firms will offer online portfolio management or another form of a web-based interface, this technology is not the company’s product. The financial asset, fund or portfolio under management is the company’s product.

In this case, Origin Investments buys either ownership or debt interests in multifamily real estate around the country. It packages these properties into a series of portfolios, and the firm’s product is shared in those portfolios. As an investor, you have very little trading activity to conduct beyond buying or selling your interest in these funds.

Origin Investments Fees

SmartAsset: Origin Investments Review

Although Origin Investments requires a hefty minimum investment for both of its funds ($100,000 for its IncomePlus FUnd and $50,000 for the QOZ Fund III) it has not published information about its fee structure, which makes any additional information on this subject speculative. It only releases these details to accredited investors.

Third-party reporting suggests that Origin Investments charges a management fee of 1.25%, as well as an up-front setup fee of 2% for any initial investment. Periodic additional fees can apply as well, such as when the firm acquires new real estate.

As with many real estate investment funds, this is a highly illiquid asset. Depending on your specific investment, the firm will place restrictions on when you can withdraw your money and how long you must leave an investment in place. For example, the firm’s QOZ Fund III has a hold period of 10 years.

How Well Does Origin Investments Work?

SmartAsset: Origin Investments Review

As mentioned above, reliable and current data on Origin Investments’ actual results is not publicly available. That’s the case for both of the funds the company runs.. However, Origin Investments has been around since 2007 and is a residential real estate firm that survived the housing market bubble and ensuing financial crisis. While that’s encouraging, it’s no reason not to do your due diligence.

Perhaps the most important detail about Origin Investments is that this firm is only available for accredited investors. You cannot buy into one of this firm’s funds otherwise. Many alternative investments are restricted to accredited investors by law. This is generally to protect laypeople from predatory behavior on the part of the financial industry.

When an asset class is considered particularly risky or exotic, the government restricts it to investors who either understand the risks they’re taking or have the money to lose. Regulators don’t want underhanded traders scamming ordinary investors with promises of outsized returns based on products that nobody can be expected to understand.

This is particularly true of any financial product or investment opportunity that is not regulated by the SEC. As a real estate firm that has chosen to organize itself as a series of LLCs rather than a regulated REIT, Origin Investments falls under that category.

This can be a very smart way to operate for firms that are not concerned about missing out on the retail market. The lack of regulatory oversight can help keep costs down, while the firm can structure its returns to minimize any tax implications for its investors. However, it does mean that details are hard to come by.

Keep in mind that an accredited investor should not be confused with the more loosely defined “sophisticated investor,” another very specific legal class. The SEC defines an accredited investor as one of the following:

  • A household with an annual income of more than $200,000 for single investors or $300,000 for married investors, over at least two years
  • A household with more than $1 million in assets (not counting primary residence)
  • An investment professional who’s in good standing and holds either Series 7, Series 65 or Series 82 licenses.
  • The director, executive officer or general partner of a company that sells securities
  • A family client of a family office that’s considered an accredited investor
  • A “knowledgable employee” of a private fund

Bottom Line

Origin Investments is a firm that runs two real estate investment funds. This firm is limited to accredited investors only, but it suggests strong returns for those who can handle the complexity and risks that come with this market. You may want to work with a financial advisor to manage your investments for you or to help you make the right investment decisions.

Tips for Investing

  • Accredited investors are investors with a wealth of financial knowledge at their fingertips, but you don’t have to have their money or experience to capture the same benefits. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • Make sure your investment assets fit your risk profile. SmartAsset’s free, easy-to-use asset allocation calculator will help align your assets with your risk tolerance.

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