In recent years, the world of real estate investment has transformed with new and innovative approaches which offer unique advantages. One such approach is known as Equity Estates Fund, which specializes in luxury vacation homes. Founded by Philip Mekelburg, Equity Estates Fund provides a new era in vacation home ownership that has attracted the attention of high-net-worth individuals, families, and tightly held business partnerships alike. Their “Invest Where You Play” model is one any wise investor would want to consider.
Equity Estates Fund is a private equity offering specializing in luxury vacation homes. The Fund purchases multi-million-dollar homes in sought-after vacation destinations like mountain resorts, beach towns, cities, and golf communities. Investors in the Fund own a share of the entire portfolio rather than a specific property. This allows investors to diversify their real estate holdings across multiple locations. Investors in Equity Estates Fund purchase a membership interest, which gives them access to the Fund’s portfolio of luxury vacation
homes around the world. Investment levels begin at 15 nights of annual usage per year and go up from there. The Fund manages all aspects of the residences and offers a full suite of concierge support and daily housekeeping, so you are vacationing the minute you arrive. Most importantly, there is a defined exit strategy to sell off all Fund homes in about ten years. “The effects of inflation alone should cause a profitable experience ten years plus down the line when the fund intends to sell its homes, and even more so if the buying pressures of recent continue to appreciate second home values.” Mekelburg shared. After over 16 years in business, with more than 60 destinations, and having delivered 20,000+ outstanding vacations, the Fund offers an investment strategy that you and your family will enjoy for years to come.
Equity Estates Fund offers several unique advantages over traditional real estate investment approaches:
Diversification: By investing in the Fund, investors can diversify their luxury real estate holdings across multiple properties and locations. This helps mitigate risk and reduce exposure to any one property or market. This also checks the box for those who have wanderlust and enjoy many different types of beach, mountain, city, and leisure destinations.
Collective Asset Ownership: Investors of the Fund own and enjoy a portfolio of multi-million-dollar vacation homes (~4MM on average value each) in sought-after destinations. This allows them to enjoy luxury vacations at a fraction of the cost of owning a second home outright.
Transparency: Investors share the actual annual costs, much like a cooperative, and pay a 1% annual asset management fee. The Fund is fully audited each year by RSM so investors have comfort that the money was used as planned. Management has a fiduciary obligation to the investors, unlike other models, where someone else owns all the real estate and can alter how they spend the money they collect. The soundness of Equity Estates’ model has proven itself through the Great Recession and the pandemic.
Availability: The Fund acquires homes as they raise capital to target <60% occupancy. This allows for more access than other shared models that try to utilize every night, like a hotel owner would do or other fractional residence club models would do, to maximize their profits. Equity Estates takes a different approach so the investors can enjoy the homes themselves and maximize their usage without any of the headaches of managing one or more vacation homes.
Potential for Appreciation: As with any real estate investment, there is potential for appreciation in the value of the properties over time. This could result in a significant return on investment for Fund investors as the distribution waterfall calls for 100% return of capital and 80% thereafter. The Managing Member (aka General Partner or management team) won’t make their carried interest 20% share until after investors get 100% of their original capital contribution returned.
Furthermore, the Equity Estates Fund has over sixteen years of experience buying, selling, and renovating luxury vacation homes. They’ve developed a rigorous due diligence process when selecting properties for their portfolio, a high-end standard level of service, and well thought out standard for in-home amenities ranging from aluminum foil to toiletries always in stock and available. The Fund only invests in properties located in desirable vacation destinations with strong demand and potential for appreciation. This approach and how they care for these assets help to mitigate risk and contribute to the likelihood that the Fund’s properties maintain their value over time.
With the potential for long-term appreciation, Equity Estates Fund is an attractive option for accredited investors looking for bespoke attention, predictable quality, and preservation of wealth while enjoying luxury vacations. With management’s expertise and experience, the Fund is poised for continued success in a world of luxury real estate investment.
Interested in getting more information on the fund? Fill out the form below or visit https://equityestatesfund.com/ to learn more.