Material risks of an investment in our common stock include:. We will not sell any shares unless we sell a minimum of , shares of our common stock by August 24, , which is one year from the effective date of this offering. Prior to the time we sell at least , shares of our common stock, your subscription payments will be placed in an account held by UMB Bank, N. If we are not able to sell at least , shares by August 24, , we will terminate this offering and your funds in the escrow account, including any interest earned on your funds, will be returned to you within ten business days.
This offering will end no later than August 24, , unless extended. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The use of forecasts in this offering is prohibited. Any representation to the contrary and any predictions, written or oral, as to the amount or certainty of any present or the future cash benefit or tax consequence which may flow from an investment in our common stock is not permitted.
No one is authorized to make any statements about this offering different from those that appear in this prospectus. We will accept subscriptions only from people who meet the suitability standards described in this prospectus. We will amend or supplement this prospectus if there are any material changes in our affairs.
Per Share. Minimum Offering. Maximum Offering. Public offering price, primary shares. Public offering price, distribution reinvestment plan. Commissions 1. Proceeds, before expenses, to us 2. Discounts are available for certain categories of investors. These expenses include registration and filing fees, possibly certain bona fide itemized and detailed due diligence expenses, legal and accounting fees, printing and mailing expenses, bank fees and other administrative expenses. The date of this prospectus is August 24, An investment in our common stock involves significant risk and is suitable only for persons who have adequate financial means, desire a relatively long-term investment and who will not need immediate liquidity from their investment.
Persons who meet this standard and seek to diversify their personal portfolios with a real estate-based investment, preserve capital, receive current income, obtain the benefits of potential long-term capital appreciation and who are able to hold their investment for a time period consistent with our liquidity plans are most likely to benefit from an investment in our company.
On the other hand, we caution persons who require immediate liquidity or guaranteed income, or who seek a short-term investment not to consider an investment in our common stock as meeting these needs. In order to purchase shares in this offering, you must:.
We have established suitability standards for initial stockholders and subsequent purchasers of shares from our stockholders. Several states have established suitability requirements that are more stringent than the standards that we have established and described above.
Shares will be sold to investors in these states only if they meet the special suitability standards set forth below. In the case of sales to fiduciary accounts such as an IRA, Keogh Plan or pension or profit-sharing plan , these minimum suitability standards must be satisfied by the beneficiary, the fiduciary account, or by the donor or grantor who directly or indirectly supplies the funds to purchase our common stock if the donor or the grantor is the fiduciary.
In the case of gifts to minors, the minimum suitability standards must be met by the custodian of the account or by the donor. We, IREIC, our dealer manager and each soliciting dealer must make every reasonable effort to determine that the purchase of common stock is a suitable and appropriate investment for each investor based on the information provided by the investor in the subscription agreement or otherwise.
Except in respect of a transfer made pursuant to a transfer on death designation or a qualified transfer to meet a required minimum distribution, you may not transfer fewer shares than the minimum purchase requirement. A tax-exempt entity is generally any investor that is exempt from federal income taxation, including:. An investment in our common stock will not, in itself, create a retirement plan; in order to create a retirement plan, an investor must comply with all applicable provisions of the Internal Revenue Code.
In order to satisfy the initial minimum purchase requirements for retirement plans, unless otherwise prohibited by state law, a husband and wife may jointly contribute funds from their separate IRAs. These minimum investment amounts for future purchases do not apply to purchases of shares through our distribution reinvestment plan.
Treasury Department;. Shares of our common stock also may be offered and sold in Canada in reliance on and in accordance with exemptions from the prospectus requirements of Canadian provincial and territorial securities laws or pursuant to discretionary exemption orders obtained in advance from applicable provincial or territorial regulatory authorities. This summary highlights the material information contained elsewhere in this prospectus.
Because this is a summary, it does not contain all information that may be important to you. You should read this entire prospectus and its appendices carefully before you decide to invest in shares of our common stock. In general, a REIT is an entity that:.
Risk Factors. An investment in our shares involves significant risks and various conflicts of interest. If we are unable to effectively manage these risks and conflicts, we may not meet our investment objectives and you may lose some or all of your investment.
Further, we are not required to liquidate. Any shares that you are able to resell may be sold at prices less than the amount you paid for them. Our board does not anticipate evaluating a listing on a national securities exchange until at least The value of our shares using this approach will likely exceed what you might receive for your shares if you tried to sell them or if we liquidated our portfolio.
Some or all of our distributions may be paid from the proceeds generated by borrowings, including borrowings secured by our assets, resulting in us having less money available to invest in properties or other real estate assets.
We also may fund distributions from cash flow generated from investing activities, including the net proceeds from the sale of our assets. We will not fund any distributions from the net proceeds of this offering. We may also fund distributions from advances from our Business Manager or IREIC or from the cash retained by us in the case that our Business Manager defers, accrues or waives all, or a portion, of its business management fee.
A deferral, accrual or waiver of any fee owed to our Business Manager will have the effect of increasing cash flow from operations for the relevant period. There is no assurance that our Business Manager will defer, accrue or waive any fees.
We will operate under the direction of our board of directors, the members of which are accountable to us and our stockholders as fiduciaries. Our board, including a majority of our independent directors, must approve certain actions. Those matters are set forth in our charter.
We initially have five members on our board of directors, three of whom are independent of IREIC and its affiliates. These independent directors will be responsible for reviewing the performance of our Business Manager and Real Estate Managers. All of our directors will be elected annually by our stockholders. The following chart depicts the services that affiliates of our sponsor have or may render to us, and our organizational structure:.
The Inland Real Estate Group of Companies coordinates, among other things, marketing to prospective tenants as well as identifying and monitoring legislation that may impact us and our stockholders. Description of Real Estate Assets.
We will focus on acquiring commercial real estate located in the United States and Canada, as well as REITs or other real estate operating companies. We will focus on properties or entities owning properties such as:. We do not expect to invest any specific amount or percentage of assets in any one type of property. We will supplement this prospectus to describe any material assets that we acquire or propose to acquire during the course of this offering.
We expect to finance a portion of the purchase price of any real estate asset that we acquire with monies borrowed on an interim or permanent basis from banks, institutional investors and other lenders, including lenders affiliated with our sponsor. We also may borrow monies to acquire a REIT or other real estate operating company.
Any money that we borrow may be secured by a mortgage or other security interest in some, or all, of our assets. The interest we will pay on our loans may be fixed or variable. We also may establish a revolving line of credit for short-term cash management and bridge financing purposes. Further, we may agree to limit the time during which we may prepay any loan in order to reduce the interest rate on the loan.
For these purposes, the fair market value of each asset will be equal to the purchase price paid for the asset or the value reported in the most recent appraisal of the asset, whichever is later. The loan agreements with our lenders may impose additional restrictions on the amount we may borrow.
We do not intend to exceed the leverage limits in our charter except in the early stages of our operations. Estimated Use of Proceeds of Offering. The remaining offering proceeds will be used to pay organization and offering expenses and acquisition expenses.
Conflicts of Interest. IRC and Inland Western acquire and manage retail properties. IRC focuses on neighborhood, community, power and lifestyle retail centers and single-tenant retail properties, located primarily in the Midwest. Inland Western owns a national retail portfolio including lifestyle, power and community centers, as well as single-tenant net lease properties.
Inland American owns a diversified portfolio of assets, including retail, multi-family, industrial, lodging, office and student housing properties. Inland American also invests in joint ventures, development projects, real estate loans and real estate-related securities, and has selectively acquired REITs and other real estate operating companies.
Each of these entities also may purchase single tenant net-leased properties located anywhere in the United States and, in the case of Inland American, Canada. We will actively seek to invest in the same types of assets as these entities.
We will not have any rights to the assets acquired by, or identified to be acquired by, any of these entities. Other conflicts of interest include:. These individuals will face competing demands for their time and services and may have conflicts in allocating their time between our business and assets and the business and assets of these other entities. IREIC also may face a conflict of interest in allocating personnel and resources among these entities;.
In some cases, these fees will be based upon various metrics such as a percentage of our invested assets, the purchase price for these assets or the revenues generated by these assets. This may result in our Business Manager recommending investments in an effort to increase these fees;.
We, along with certain of these REITs, rely to some degree on affiliates of IREIC to identify and assist in acquiring real estate assets, and will not have our own acquisitions group;. We also will reimburse these entities for expenses incurred in performing services on our behalf.
Set forth below is a summary of the most significant fees and expenses that we will pay, or expect to pay, to these entities. We have not given effect to any special sales or volume discounts that could reduce selling commissions. We will not pay selling commissions, the marketing contribution or issuer costs in connection with shares of common stock issued through our distribution reinvestment plan.
Type of Compensation. Offering Stage. Selling Commissions. Marketing Contribution. We will pay Inland Securities a fee for marketing the shares in connection with this offering, which includes coordinating the marketing of the shares with any soliciting dealers, in an amount equal to 2. Inland Securities may reallow up to 1. Due Diligence Expense Reimbursement. We will reimburse Inland Securities and soliciting dealers for bona fide out-of-pocket, itemized and detailed due diligence expenses incurred by these entities, in amounts up to 0.
These expenses may, in our sole discretion, be reimbursed from amounts paid or reallowed to these entities as a marketing contribution, or may be reimbursed from issuer costs. If these expenses are reimbursed from amounts paid or reallowed as a marketing contribution, there will be no additional costs to us. Issuer Costs. Operational Stage. Acquisition Expenses. We will reimburse our Business Manager, Real Estate Managers and entities affiliated with each of them, such as IREA, Inland Capital Markets Group, Inland Institutional Capital Partners Corporation and their respective affiliates for expenses paid on our behalf in connection with acquiring real estate assets, regardless of whether we acquire the assets.
The actual amount will depend on the cost associated with each asset and cannot be determined at this time. Real Estate Management Fees. For each property that is managed directly by any of our Real Estate Managers or their affiliates, we will pay the applicable Real Estate Manager a monthly fee of up to 4.
The applicable Real Estate Manager will determine, in its sole discretion, the amount of the fee with respect to a particular property, subject to the 4. This fee may be increased, subject to the approval of a majority of our independent directors, for certain properties. We also will reimburse each Real Estate Manager and its affiliates for property-level expenses that they pay or incur on our behalf, including the salaries, bonuses and benefits of persons employed by the Real Estate Manager and its affiliates except for the salaries, bonuses and benefits of persons who also serve as one of our executive officers or as an executive officer of any of our Real Estate Managers.
The actual amount depends on the gross income generated and cannot be determined at the present time. Oversight Fee. In no event will our Real Estate Managers receive both a real estate management fee and an oversight fee with respect to a particular property.
In addition, except as otherwise approved by a majority of our independent directors, the total fees paid to our Real Estate Managers for managing a particular property, including oversight fees, will not exceed 4. The actual amount will depend on the number of properties managed by third parties and the gross income generated by these properties. Thus, the actual amount cannot be determined at the present time. Business Management Fee. Accordingly, we would pay a business management fee equal to 0.
Further, assuming that 1 , 2 or 3 above is satisfied, our Business Manager may decide, in its sole discretion, to be paid an amount less than the total amount that may be paid. The actual amount will depend on the carrying value of our assets and cannot be determined at the present time.
The obligation to pay this fee on a going forward basis will terminate if we acquire our Business Manager. Incentive Fee. Net sales proceeds will be calculated after paying any property disposition fee to Inland Real Estate Brokerage, Inc. The actual amount will depend on the amount of net proceeds from the sale of our real estate assets and cannot be determined at the present time.
The obligation to pay this fee will terminate if we acquire our Business Manager. Interest Expense. We may borrow money from our Business Manager and its affiliates, as well as other REITs previously sponsored by IREIC, so long as a majority of our disinterested directors, including a majority of our disinterested independent directors, approves the transaction as fair, competitive and commercially reasonable and no less favorable to us than loans between unaffiliated parties under the same circumstances.
We will pay interest on these loans at prevailing market rates. The actual amount of interest paid will depend on the amount borrowed and the interest rate prevailing at the time. We cannot determine the amount at this time. We will pay Inland Mortgage Servicing Corporation 0.
The actual amount will depend on the dollar amount of the loans in our portfolio and cannot be determined at the present time. Brokerage Fee. We will pay Inland Financial Products, Inc. The actual amount will depend on the dollar amount of these assets that we purchase, and cannot be determined at the present time. Ancillary Services Reimbursements.
We will reimburse IREIC, our Business Manager and their respective affiliates for any expenses that they pay or incur in providing ancillary services to us. The actual amount will depend on the services provided and the method by which reimbursement rates are calculated.
Actual amounts cannot be determined at the present time. Investment Advisor Fee. We will pay Inland Investment Advisors, Inc. The actual amount of fees to be paid will depend on the then-current value of our investments and cannot be determined at the present time.
Institutional Investment Fees. The advisory fee will be paid in arrears on a quarterly basis. In addition, in the event that ICAP identifies an institutional partner or operating partner with whom we actually enter into a definitive agreement, we will pay ICAP an investment fee of 0. This investment fee will be offset by the hourly advisory fee described above. The actual amount will depend on the number of partners identified and the number of joint ventures and other co-ownership arrangements that we enter into, and cannot be determined at the present time.
Listing Fee. In the event that, at the date of determination, stockholders have not received a return of capital plus the priority return, less any distributions of net sales or financing proceeds, the fee will be paid at.
The obligation to pay this fee will terminate if we acquire our Business Manager prior to a liquidity event. In addition, any cash consideration received by our stockholders in connection with any liquidity event will be added to the market value determined in accordance with clause 1 or 2.
Liquidation Stage. Property Disposition Fee. The actual amounts to be received will depend upon the contract sales price of our properties and the customary commissions paid to third party brokers and, therefore, cannot be determined at the present time. Investment Objectives. Our investment objectives generally are:. To achieve these objectives, we intend to selectively acquire and actively manage investments in commercial real estate and other real estate assets. To the extent we sell assets, we intend to reinvest the sale proceeds.
Distribution Policy. We intend to pay regular monthly cash distributions to our stockholders. We anticipate that we will begin declaring distributions no later than sixty days after we have sold enough shares to satisfy the minimum offering condition.
Until the proceeds from this offering are fully invested and from time to time thereafter, we may not generate sufficient cash flow from operations, determined in accordance with GAAP, to fully fund distributions. ERISA is a federal law that regulates the operation of certain tax-advantaged retirement plans. Any retirement plan trustee or individual considering purchasing shares for a retirement plan or an individual retirement account should read this section of the prospectus carefully and is encouraged to seek the counsel of his or her tax advisor.
Stockholder Voting Rights and Limitations. We will hold annual meetings of our stockholders to elect directors or conduct other business matters that may be properly presented at these meetings. We also may call special meetings of stockholders from time to time. The holders of our common stock are entitled to one vote per share on all matters voted on by stockholders, including electing our directors.
Restriction on Share Ownership. Our charter contains restrictions on the number of shares any one person or group may own. Specifically, no person or group may own or control more than 9. This limit may be further reduced if our board of directors waives this limit for certain holders. Terms of the Offering. No specified number of securities are, therefore, guaranteed to be sold and no specified amount of money is guaranteed to be raised in this offering.
The offering price of our shares was determined by our board of directors in its sole discretion. Our board of directors determined the offering price based upon the offering price of other REITs organized by our sponsor, the offering price of other REITs that do not have a public trading market and the recommendation of Inland Securities, our dealer manager. Appropriateness of Investment. An investment in our shares may be appropriate as part of your investment portfolio if:. We cannot guarantee that we will achieve any of these objectives.
Distribution Reinvestment Plan. We are offering up to 50,, shares to be sold to stockholders who participate in our distribution reinvestment plan. Distributions may be fully reinvested because the distribution reinvestment plan permits fractional shares to be purchased.
If you participate, you will be taxed on income attributable to the reinvested distributions based on the fair market value of shares of our common stock received in lieu of a cash distribution. Thus, you would have to rely solely on sources other than distributions from us to pay taxes on the distributions. As a result, you may have a tax liability without receiving cash distributions to pay the tax liability.
Our board may amend, suspend or terminate the plan, including increasing the per share purchase price, in its sole discretion at any time without prior notice to participants. Investment Company Act of We also may acquire real estate assets through investments in joint venture entities, including joint venture entities in which we do not own a controlling interest. We anticipate that our assets generally will be held in wholly and majority-owned subsidiaries of the company, each formed to hold a particular asset.
We will continuously monitor our holdings on an ongoing basis to determine the compliance of the company and each majority-owned subsidiary with this test. Rather, the company and its subsidiaries. Consequently, the company and its subsidiaries expect to be able to conduct their respective operations such that none of them will be required to register as an investment company under the Investment Company Act.
The determination of whether an entity is a majority-owned subsidiary of our company is made by us. The Investment Company Act further defines voting securities as any security presently entitling the owner or holder thereof to vote for the election of directors of a company. We have not requested that the SEC staff approve our treatment of any entity as a majority-owned subsidiary and the SEC staff has not done so.
Any such adjustment in our strategy could have a material adverse effect on us. We intend to treat as real estate-related assets CMBS, debt and equity securities of non-majority owned companies primarily engaged in real estate businesses and securities issued by pass-through entities of which substantially all of the assets consist of qualifying assets or real estate-related assets. Qualification for exemption from registration under the Investment Company Act will limit our ability to make certain investments.
For example, these restrictions may limit the ability of the company and its subsidiaries to invest directly in mortgage-backed securities that represent less than the entire ownership in a pool of mortgage loans, debt and equity tranches of securitizations and certain asset-backed securities and real estate companies or in assets not related to real estate. Although we intend to monitor our portfolio, there can be no assurance that we will be able to maintain this exemption from registration for our company or each of our subsidiaries.
To the extent that the SEC staff provides more specific guidance regarding any of the matters bearing upon the definition of investment company and the exceptions to that definition, we may be required to adjust our strategy accordingly.
Any additional guidance from the SEC staff could provide additional flexibility to us, or it could further inhibit our ability to pursue the strategies we have chosen. Estimated Use of Proceeds. The amounts listed in the table below represent our best good faith estimate of the use of offering proceeds. The estimates may not accurately reflect the actual receipt or application of the offering proceeds.
We have not given effect to any special sales or volume discounts which could reduce selling commissions under either scenario. In addition, we will not pay selling commissions, the marketing contribution or issuer costs in connection with shares of common stock issued through our distribution reinvestment plan. Gross Offering Proceeds. Less Organization and Offering Expenses:. Marketing Contribution 1. Issuer Costs 1 2. Gross Amount Available. Acquisition Expenses 3.
Issuer costs include amounts for SEC registration fees, FINRA filing fees, certain bona fide itemized and detailed due diligence expenses, printing and mailing expenses, blue sky fees and expenses, legal fees and expenses, accounting fees and expenses, advertising and sales literature, transfer agent fees, data processing fees, bank fees and other administrative expenses of the offering.
The actual amount of acquisition expenses cannot be determined at the present time and will depend on numerous factors including the type of real estate asset acquired, the aggregate purchase price paid to acquire the real estate asset, the aggregate amount borrowed, if any, to acquire the real estate asset, the number of real estate assets acquired, and the type of consideration, cash or common stock, used to pay the expenses.
Pending the acquisition of properties or other real estate assets, we may invest proceeds in cash and short-term, highly liquid investments. Further, we may use proceeds to pay operating expenses or to fund reserves. We also may purchase medical office buildings and other healthcare-related facilities and public infrastructure assets, including toll roads, water utilities, correctional facilities, airports, ports, electricity and gas transmission and distribution networks and telecommunications facilities.
We may purchase properties that have been constructed and have operating histories, are newly constructed, are under development or construction, or have not yet been developed. We may originate and invest in real estate-related loans, including first and second mortgage loans, mezzanine loans, B-Notes, bridge loans, convertible mortgages, wraparound mortgage loans, construction mortgage loans and participations in these loans.
These loans may be secured by first or second mortgages on commercial real estate or a pledge of ownership interests in the entity owning commercial real estate. We intend to be taxed as a REIT for federal and state income tax purposes. Therefore, we cannot. Prior to the time we sell at least , shares, subscription payments will be placed in an escrow account with our escrow agent, UMB Bank, N. If we are not able to sell at least , shares by August 24, , which is one year from the original effective date of this prospectus, we will terminate this offering and all funds in the escrow account, including any interest earned on the funds, will be returned to subscribers within ten business days following the termination date.
Common stock purchased by any of our officers, directors or affiliates, or by our dealer manager or any soliciting dealer, will not count toward satisfying the minimum offering. If you choose to purchase shares in this offering, you will need to fill out a subscription agreement, forms of which are included in this prospectus as Appendix C-1 , and pay for the shares at the time you subscribe.
If you decide to purchase shares, our escrow agent will hold your funds in escrow, along with those of other subscribers, until we accept your subscription. Generally, we accept or reject subscriptions within ten days of receipt. Our board may terminate this offering at any time and may extend the best efforts offering for an additional year. If we extend the offering for another year and file another registration statement during the one-year extension in order to sell additional shares, we could continue to sell shares in this offering until the earlier of days after the third anniversary of commencing this offering or the effective date of the subsequent registration statement.
If we decide to extend the best efforts offering beyond two years from the date of this prospectus, we will provide that information in a prospectus supplement. If we file a subsequent registration statement, we could continue offering shares with the same or different terms and conditions.
Nothing in our organizational documents prohibits us from engaging in additional subsequent public offerings of our stock. The offering must be registered in every state in which we offer or sell shares. Generally, these registrations are for a period of one year.
Thus, we may have to stop offering and selling in any state in which the registration is not renewed annually. In this offering, we anticipate that all common stock will be issued only in book entry form. The use of book entry registration protects against loss, theft or destruction of stock certificates and reduces our offering costs.
If you choose to rescind your subscription, all subscription payments held in escrow for your benefit will be returned to you by the escrow agent within ten business days of being notified by us of your election to rescind. You will not be able to rescind your subscription after we sell at least , shares. Purchases of common stock by any of our officers, directors and affiliates, or by our dealer manager or any soliciting dealer, will not count toward satisfying the minimum offering.
A public market may never develop. You may not be able to sell your shares when you desire or at a price equal to or greater than the offering price. In addition, our charter imposes restrictions on the ownership of our common stock, which will apply to potential purchasers of your stock. As a result, you may find it difficult to find a buyer for your shares. If you meet the limited qualifications to participate in our share repurchase program, you may be able to sell your shares to us.
In the event that the board or our Business Manager makes a future determination regarding the estimated value of our shares, however, our board of directors, in its sole discretion, may change these repurchase prices. Stockholders who have held their shares for at least one year may request that we repurchase any number of shares by submitting a repurchase request, the form of which is available on our website, to our repurchase agent. We will effect all repurchases on the last business day of the calendar month or any other business day that may be established by our board of directors.
The share repurchase program will immediately terminate if our shares are listed on any national securities exchange. In addition, our board of directors, in its sole discretion, may at any time amend, suspend in whole or in part , or terminate our share repurchase program.
In the event that we amend, suspend or terminate the share repurchase program, however, we will send stockholders notice of the change at least thirty days prior to the change. Further, our board reserves the right in its sole discretion to reject any requests for repurchases.
We may originate or invest in real estate-related loans to third parties or to affiliates of, or entities sponsored by, IREIC. These loans may be. Aside from these requirements, we do not have, and do not expect to adopt, any policies limiting the amount or percentage of assets that will be used to fund loans to affiliates of, or entities sponsored by, IREIC.
Our investment policies and strategies are very broad. We also may invest proceeds received from this offering in short-term, highly liquid investments. These short-term investments typically yield less than investments in commercial real estate or other real estate related assets.
We also may use proceeds to pay operating expenses or to fund reserves. As of the date of this prospectus, we have not identified any specific assets to acquire with the proceeds from this offering. The property or properties in which these public programs intend to invest are not always known prior to commencing the offering.
During a blind pool offering, we will identify acquisition opportunities during and possibly after our public offering has closed. Pending investment in real estate assets, we expect to invest the offering proceeds in short-term government securities or other liquid instruments.
We believe that the blind pool offering format offers us a greater degree of flexibility than a specified asset program because we are more likely to have funds available before identifying specific assets for acquisition. Under this scenario, we believe we would operate at a significant competitive disadvantage as compared to entities that may have currently available sources of financing. Because we own no real estate assets, you cannot currently consider the financial history of any assets we may acquire.
In contrast, our board of directors determined the offering price of our shares in its sole discretion. You should keep in mind that, because we are not trading on a national securities exchange, there is no public market for our shares and no assurance that one may develop.
Our board does not anticipate evaluating a listing on a national securities. You likely will not be able to realize appreciation in the value of our portfolio, if any, until we liquidate or list our stock for trading. In contrast, we already intend to own a well diversified portfolio of various real estate assets. The actual amount and timing of distributions will be determined by our board of directors in its discretion and typically will depend on the amount of funds available, which depends on items such as current and projected cash requirements and tax considerations, among other things.
As a result, our distribution rate and payment frequency may vary from time to time. However, because depreciation expense reduces taxable income but does not reduce cash available for distribution, we expect a portion of your distributions will be considered a return of capital for. The amounts considered a return of capital will not be subject to tax immediately but will instead reduce the tax basis of your investment in effect deferring a portion of your tax until you sell your shares or we liquidate.
This plan may, however, be amended, suspended or terminated in the sole discretion of our board, without prior notice to participants. If listing our shares of common stock is not feasible, our board may decide to:. Therefore, we believe it is more appropriate to allow us and our board of directors the flexibility to consider multiple options and not be obligated to execute a particular liquidity event by a set date. Roberta S. An investment in our shares involves significant risks and is suitable only for those persons who understand the following risks and who are able to bear the risk of losing their entire investment.
You should consider the following risks in addition to other information set forth elsewhere in this prospectus before making your investment decision. Risks Related to the Offering. We have no operating history, and neither our prior performance nor the prior performance of programs sponsored by IREIC should be used to predict our future results. We are newly-formed with no operating history.
We are subject to all of the business risks and uncertainties associated with any new business, including the risk that we will not achieve our investment objectives and that the value of your investment could decline substantially. You should not rely on the past performance of other real estate investment programs sponsored by IREIC to predict our future results. There is no public market for our shares, and you may not be able to sell your shares.
Our charter does not require our directors to seek stockholder approval to liquidate our assets by a specified date, nor does our charter require our directors to list our shares for trading by a specified date. There is no public market for our shares and no assurance that one may develop. We do not expect that our shares will be listed for trading on a national securities exchange in the near future, if ever.
Our board will determine when, and if, to apply to have our shares of common stock listed for trading on a national securities exchange, subject to satisfying existing listing requirements. Further, our charter limits a person or group from owning more than 9. These restrictions may inhibit your ability to sell your shares. The offering price of our shares was determined by the board in its sole discretion.
Our board of directors determined the offering price in its sole discretion based on:. Because the offering price is not based upon any independent valuation, the offering price may not be indicative of the proceeds that you would receive upon liquidation. Further, the offering price may be significantly more than the price at which the shares would trade if they were to be listed on an exchange or actively traded by broker-dealers.
In determining the estimated value of our shares eighteen months after the last primary offering of our shares and prior to a listing, our board, our Business Manager or another firm we choose for that purpose, will estimate the value of our shares based upon a number of assumptions that may not be complete.
These estimates may not accurately reflect the fair market value of our investments nor will they necessarily represent the amount of net proceeds that would result from an immediate sale of our assets. To the extent we have not yet acquired or identified assets to acquire at the time you make your investment decisions, you will not be able to evaluate the economic merits, transaction terms or other financial or operational data concerning our investments prior to purchasing shares of our common stock.
You must rely on our Business Manager and our board of directors to implement our investment policies, to evaluate our investment opportunities and to structure the terms of our investments. For example, in the event we only raise the minimum amount, we will most likely make our investments through one or more joint ventures with third parties and may only be able to make one investment.
Additionally, our inability to raise substantial funds would increase our fixed operating expenses as a percentage of gross income. We depend on an affiliate of our sponsor to raise funds in this offering. Events that prevent our dealer manager from serving in that capacity would jeopardize the success of this offering and could reduce the value of your investment.
The success of this offering depends to a large degree on the capital-raising efforts of our dealer manager, Inland Securities Corporation, an affiliate of our sponsor. Our dealer manager has limited capital. In order to conduct its operations, our dealer manager depends on transaction-based compensation that it earns in connection with offerings in which it participates.
If our dealer manager does not earn sufficient revenues from the offerings that it manages, it may not have sufficient resources to retain the personnel necessary to market and sell large amounts of shares on our behalf. In the event. Therefore, any event that hinders the ability of our dealer manager to conduct the offering on our behalf would jeopardize the success of the offering.
Our share repurchase program may be amended, suspended or terminated by our board of directors. Our board of directors, in its sole discretion, may amend, suspend in whole or in part , or terminate our share repurchase program. Further, our board reserves the right in its sole discretion to change the repurchase prices or reject any requests for repurchases. Any amendments to, or suspension or termination of, the share repurchase program may restrict or eliminate your ability to have us repurchase your shares and otherwise prevent you from liquidating your investment.
Risks Related to Our Business. The amount and timing of distributions may vary. We may pay distributions from the proceeds generated by borrowings. There are many factors that can affect the availability and timing of cash distributions to stockholders such as our ability to buy, and earn positive yields on, real estate assets, the yields on securities of other entities in which we invest, our operating expense levels, as well as many other variables.
The actual amount and timing of distributions will be determined by our board of directors in its discretion, based on its analysis of our earnings, cash flow, anticipated cash flow, capital expenditure requirements and general financial condition. Actual cash available for distribution may vary substantially from estimates. In addition, to the extent we invest in development or redevelopment projects, or in properties that have significant capital requirements, our ability to make distributions may be negatively impacted, especially during our early period of operation.
Some or all of our distributions may be paid from the proceeds generated by borrowings, including borrowings secured by our assets, and from the proceeds from the sale of our assets. Distributions reduce the amount of money available to invest in properties or other real estate assets.
Further, distributions that exceed cash flows from operations or the cash flow generated by investing activities will likely not be sustainable for a significant period of time. We may suffer from delays in selecting, acquiring and developing suitable properties. Regardless of the amount of capital we raise or borrow, we may experience delays in deploying our capital into assets or in realizing a return on the capital we invest.
The more money we raise in this offering, the more difficult it will be to invest the net offering proceeds promptly. Therefore, the relatively large size of this offering increases the risk of delays. We could suffer from delays in locating suitable investments as a result of competition in the relevant market, regulatory requirements such as those imposed by the SEC which require us to provide audited financial statements and our reliance on our Business Manager to locate suitable investments for us at times when the management of our Business Manager is simultaneously seeking to locate suitable investments for other IREIC-sponsored programs.
Further, our investments may not yield immediate returns. For example, properties acquired before the start of construction or during the early stages of construction typically will not generate income for some. Likewise, we may experience delays as a result of negotiating or obtaining the necessary purchase documentation to close an acquisition. We also may invest all proceeds we receive from this offering in short-term, highly-liquid investments. These short-term investments, although liquid, generally generate very little current yield.
These yields will likely be less than the distribution yield paid to stockholders. A diversified investment is a mixture of different assets like stocks, fixed income securities, commodities with the objective to achieve the highest return for the minimum level of risk. The diversification concept works because all the different types of assets have a different reaction with respect to the same event happening in the economy.
All the assets in the diversified investments do not have a correlation with each other, and generally, when the value of some type of investment falls, then at the same the value of another type of assets may rise. Due to this, the overall risk of total investments becomes low as in case of any event; there are some classes of assets which will give benefits and offsets the loss incurred in other assets because it is rare that all the classes of assets would have a negative effect by any one event.
Diversified investments help investors in achieving a smoother and more consistent return on the investments over the long and medium-term period. When the holdings of the person are diversified widely in divergent types of assets such as stocks, bonds , commodities, real estate, and cash, then it helps in reducing the overall risk of the portfolio as each asset class exhibits the different types of strengths and weaknesses with respect to risk and profitability.
So, maintaining holdings by a person in the majority of these assets class helps him in creating a stable portfolio, which then helps in increasing value over the period. This has been a guide to what are diversified investments and its definition? Here we discuss the top 4 types of diversified investments along with examples, advantages, and disadvantages.
Forgot Password? Diversified Investments Definition A diversified portfolio of investments refers to a low risk investment plan that works as a best defense mechanism against financial crisis as it allows an investor to earn highest possible returns by making investments in a combination of a mixture of assets like stocks, commodities, fixed income, etc. Types of Diversified Investments There are different ways through which investments can be diversified, some of which are as follows: 1 — Different Asset Classes Different types of classes of assets have a different performance during the same economic event.
Central Time at Why did I get the 'Your Account has been Locked' screen? This means that you entered incorrect security information. For your security your account has been locked. Why did I get the 'Invalid Password' Message? This means the password entered does not match the information we have on file. You will have three attempts to enter the correct password before your account is locked.
If your account is locked, you will have the opportunity to establish a new password by clicking UNLOCK and following the onscreen prompts. This message is displayed when the information entered does not match what is on file. Why did I get the 'We are unable to verify your information' Message? This is the new password you will use each time you access your Inland Real Estate Investment Corporation account online.
Enter a password into the New Password field. Reenter the same password into the Verify New Password field. Why is there a red X next to my New Password? You will see a red X next to the New Password field until your password meets all requirements. Inland is not affiliated with KRG. This communication, which was prepared solely by Inland Investments, was neither authorized, directed nor approved by KRG. KRG has provided no opinion on its truth or accuracy.
With respect to any REIT that has not had a liquidity event, there is no guarantee that a liquidity event will occur. Past performance is not a guarantee of future results. This website is neither an offer to sell nor a solicitation of an offer to buy any security which can be made only by a prospectus , or offering memorandum, which has been filed or registered with appropriate state and federal regulatory agencies, and sold only by broker dealers and registered investment advisors authorized to do so.