Comparing Real Estate Funds: DLP Housing & Origin Investments

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Recently, we compared two similar private real estate funds from Trion and 37th Parallel. We’ll continue in that tradition today by looking at two larger, evergreen real estate funds from DLP and Origin Investments.

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My own passive real estate investing journey started with eREITs via platforms like Fundrise and RealtyMogul. I invested in syndicated value-add equity deals from Crowdstreet and Republic Real Estate.

The eREITs are well-diversified with investments in dozens of projects, but they don’t necessarily offer the highest tax efficiency. While selecting individual projects gives you more control and a sense of connectedness to the project, connectedness does nothing for your returns, and you have to select quite a few projects to be well diversified.

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Later, I invested in real estate funds from DLP and Origin Investments. These offer a good balance of tax efficiency, diversification, and income in a set-it-and-forget-it style that index fund investors are accustomed to.

Projected Returns

Unlike the closed-end funds we recently analyzed, both of these funds are considered to be “evergreen.” There is no date at which the assets in the fund are scheduled to be sold and the fund closed.

There may come a time when the fund(s) are scheduled to close, but I would expect that timeframe to be measured in decades, and I would hope for plenty of advance notice. It is worth noting that Origin was acquired by Kovitz Investment Group, but that operations and fund management have not changed and the co-founders will remain with the company for years to come.

Both DLP‘s Housing Fund and Origin‘s IncomePlus Fund utilize a REIT (real estate investment trust) structure, although you’re technically investing in an LLC with a REIT subsidiary in either case.

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