FAQ | South Bend 7 Private Real Estate Equity Fund
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FAQ

What are “accredited investors”?

An accredited investor is someone who’s net worth is or exceeds $1,000,000 as an individual or jointly with a spouse. This does not include your primary residence.

An accredited investor may also make $200,000 annually as an individual for two years or more. There must be a reasonable expectation to make as much the following year.

An accredited investor may also make $300,000 annually with a spouse for two years or more. There must be a reasonable expectation to make as much the following year.

What is an “accredited entity”?

Common entity accredited investors are entities with total assets of over $5,000,000.

It may also be an entity whose equity owners are all accredited investors.

Entities may also be accredited investors under many other standards.

What are the basic requirements applicable to any Rule 506 offering? 

The same definitions, limitations on resale and potential for integration applicable to companies relying on the traditional Rule 506 exemption prior to September 23, 2013 (renumbered as Rule 506(b)) will continue to apply to all offerings under Rule 506, as will the new “bad actor” disqualifications and disclosure requirements in newly added Rule 506(d).

We can help you determine if any of the disqualifications apply to you.

Will I lose the ability to conduct a concurrent Regulation S offering (for sale to non-U.S. persons outside the United States) if I use general solicitations in a Rule 506(c) offering? 

No. Concurrent Regulation S offerings will not be integrated with Rule 506(c) offerings.

Can I use Rule 506(c) if I am a private fund exempt from Investor Company Act (“ICA”) registration under Sections 3(c)(1) or (7) of the ICA? 

Yes, private funds may use Rule 506(c) without losing either the ICA Section 3(c)(1) or (7) exemptions

How do I earn returns on my investment?

You can earn money through interest payments, property income, as well as potential appreciation in value of the properties themselves.

What is the term? When can investors expect to get their money back?

Investments with South Bend 7, LLC are intended to be long-­term investments and are inherently illiquid in nature. We will for opportunities to provide liquidity to investors between five to seven years of operations. While we will seek a liquidity transaction during this time frame, there can be no assurance that a suitable transaction will be available. Market conditions for a transaction may not be favorable during that time frame.

What is a Tax form K-1?

A K-1 is a tax form is used to provide investors with detailed information on their share of their taxable income. South Bend 7, LLC will issue a  K-1 to each investor to report his or her share of the income, gains, losses, deductions, credits and depreciation. The K-1s are provided to investors on an annual basis so that each investor can include K-1 amounts on his or her tax return.

When will K-1s be available to investors?

Our goal is to finalize all K-1s by March 15th of each year. South Bend 7, LLC may rely on outside reporting, or require additional time to furnish the forms in a way that is to the investor’s best advantage. Accordingly, investors may be required to obtain one or more extensions for filing federal, state and local tax returns.

Can I reinvest my earnings?

Yes, you as an investor may opt to reinvest all of your earnings. We do require all investors under the $25,000 investment level to reinvest until they reach this amount of total investments.