Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
You reference the Bluerock Total Income+ Real Estate Fund in July as living up to its mission... How much of its price stability/low vol is really just attributable to the underlying not being marked to market?
Bluerock TI+ Real Estate is an illiquid multi-manager interval-fund related to private real estate. Asset valuations are from appraisals. You can buy interval-funds anytime from brokers/advisors, but there are only quarterly redemption windows for small amounts.
A Share: TIPRX / C Share: TIPPX / I Share: TIPWX / L Share: TIPLX / M Share: TIPMX
How often do they re-appraise - maybe annually? Interesting that they supposedly calculate a DAILY NAV.
Only $2.5K/1K minimum to invest. Fund size has grown to over $6B. Since inception at end of 2012, looks like only 3 (slightly) negative quarters! Impressive.
Too bad its an interval fund. Not sure how many brokers offer it, but apparently you can submit an application directly to Bluerock.
Bluerock TI+ Real Estate is an illiquid multi-manager interval-fund related to private real estate. Asset valuations are from appraisals. You can buy interval-funds anytime from brokers/advisors, but there are only quarterly redemption windows for small amounts.
A Share: TIPRX / C Share: TIPPX / I Share: TIPWX / L Share: TIPLX / M Share: TIPMX
I am sorry I missed this thread earlier about Bluerock and that I mentioned it in my July column. I wasn't making a case for buying the fund, but more along the line of, "here is a real estate fund that's actually up on the year."
I too am curious what portion of the fund is marked accurately. But I believe what happens with Bluerock is what happens with ALL private assets in one way or the other.
In general, if one looks at Private Equity funds, why are public pension funds historically so eager to buy into them. Charlie Munger hints that its the lack of mark to market, the lack of volatility, that makes private assets deceptively easier to hold. After all, they are no different than public assets in the real world, just their mark to market is differently scheduled. And over time as the world rebounds back, the assets self correct in time, if not in price.
Last year, was a bumper year for Public Equity REITs. VNQ was up 40% and Bluerock was up 21%. VNQ overshot.
This year, VNQ is down 20% and Bluerock is up 14%. One of them is wrong. I cant tell you which one but I have a gut which one it might be.
Bluerock has a 2Bn inflow YTd and VNQ has 900mm outlflow YTD. That explains a lot of the relative returns.
Who saw recently that Calpers sold a chunk of Private Equity portfolio at a 10% discount. hmmmm.
On Interval funds, I think they deserve more attention. The fact that one is able to indirectly buy private assets of some kind while still having some access to exit liquidity is not a bad feature. This is quite desirable because private assets, when done right, do yield more and have a better Sharpe, than public assets. There is also a 2% early redemption fee on some classes of the fund. So it's important to be careful on whatever one does.
It is interest to read about BlueRock funds since private assets are not so readily accessible for small investors. This is an internal fund and has rather limited to advisors. Seem to me that is more suitable for institutional investors including college endowment and pension plans.
@JD_co is correct that you can purchase the fund directly from BlueRock if you choose to do so. In addition to the management fee (1.5%), there are several other fees that amount to about 1.8-2.5%. A and L shares carry 4.25 and 5.75% front-end load, respectively, and they are likely to be use via an advisor.
Reviewing this fund's recent performance, the NAV has been slowly eroding in 4Q 2022. Property appraisals must be trickling in and detailing lower valuations. If so, then 2023 may not be kind to this fund.
Schwab appears to offer this BlueRock TI + Real Estate Fund (A&L classes), but only via RIAs.
Curious to see how Fidelity's brand new Credit Interval fund will be offered once it is finalized this winter. Probably via RIA access only, like most of these.
While retail investors can log into their individual accounts with brokers like Fidelity and Charles Schwab and purchase shares in ETFs and mutual funds, this usually isn’t the case for interval fund shares. Although these services might offer quotes on the performance and structure of a given interval fund, they don’t allow individuals to purchase shares on their exchanges.
Instead, interval fund shares must be purchased directly from the investment company that manages the fund.
Comments
A Share: TIPRX / C Share: TIPPX / I Share: TIPWX / L Share: TIPLX / M Share: TIPMX
https://bluerock.com/bluerock-total-income-plus-real-estate-fund/wp-content/uploads/sites/3/2022/04/TI-Fact-Sheet-Q1-2022-I-Share.pdf
Only $2.5K/1K minimum to invest. Fund size has grown to over $6B. Since inception at end of 2012, looks like only 3 (slightly) negative quarters! Impressive.
Too bad its an interval fund. Not sure how many brokers offer it, but apparently you can submit an application directly to Bluerock.
I too am curious what portion of the fund is marked accurately. But I believe what happens with Bluerock is what happens with ALL private assets in one way or the other.
In general, if one looks at Private Equity funds, why are public pension funds historically so eager to buy into them. Charlie Munger hints that its the lack of mark to market, the lack of volatility, that makes private assets deceptively easier to hold. After all, they are no different than public assets in the real world, just their mark to market is differently scheduled. And over time as the world rebounds back, the assets self correct in time, if not in price.
Last year, was a bumper year for Public Equity REITs. VNQ was up 40% and Bluerock was up 21%. VNQ overshot.
This year, VNQ is down 20% and Bluerock is up 14%. One of them is wrong. I cant tell you which one but I have a gut which one it might be.
Bluerock has a 2Bn inflow YTd and VNQ has 900mm outlflow YTD.
That explains a lot of the relative returns.
Who saw recently that Calpers sold a chunk of Private Equity portfolio at a 10% discount. hmmmm.
@JD_co is correct that you can purchase the fund directly from BlueRock if you choose to do so.
In addition to the management fee (1.5%), there are several other fees that amount to about 1.8-2.5%. A and L shares carry 4.25 and 5.75% front-end load, respectively, and they are likely to be use via an advisor.
Schwab appears to offer this BlueRock TI + Real Estate Fund (A&L classes), but only via RIAs.
Curious to see how Fidelity's brand new Credit Interval fund will be offered once it is finalized this winter. Probably via RIA access only, like most of these.
Either that or the brokerage houses would not offer them direct due to liability.
https://intervalfunds.org/insights/interval-fund-essentials-buying-shares
Here's the application for Bluerock Total Income+ Real Estate Fund
https://bluerock.com/bluerock-total-income-plus-real-estate-fund/wp-content/uploads/sites/3/2022/03/Bluerock-TI-Fund-New-Account-Application.pdf
Note the checkbox at the very bottom - if the purchase is through someone acting as an RIA, the box is to be checked. You don't have to go one.