My good friend and colleague Ari Rastegar was recently featured in D Magazine. The topic? Real estate, of course.
In the interests of full disclosure, I invest a portion of both my personal funds and my clients’ funds with Ari.
You can read an excerpt of the article here:
Dallas real estate investor Ari Rastegar has never been one to follow the crowd. He’s certainly not doing so with his company, Rastegar Equity Partners. Long before investors began balking at the “two-and-20” compensation model, Rastegar was offering an alternative.
The traditional structure used by private fund managers is to charge investors a fixed 2 percent management fee (of total asset value) and a 20 percent performance fee (on any profits earned). They also assess acquisition commissions, fees for monitoring investments, and other charges. Rastegar keeps it simple, taking a 1.2 percent management fee—then half of all profits above an 8 percent return. Instead of making money on the front end, he makes it on the back end. Investors accept the lower cut of profits after the hurdle in exchange for lower management costs and no additional fees. “I go out of my way to be open-kimono with investors,” he says. “I grew up in the era of Bernie Madoff, and I’ve seen how investors can get scared. I want them to know, ‘I’m not going to make money off you; I’m going to make money with you.’”
You can read the full article here.