What's up with CityVest?

[SteffanW]

Hmm - I'm not sure how that website is calculating the returns, but doesn't make sense. Also, VG probably does the best job out of any company at getting as close to index returns as possible, b/c of their low expense ratios.

Here is the actual Vanguard website's returns:

Interesting discrepancies. The source was Yahoo Finance. Benchmarks can be different but they shouldn't be THAT different. Also the 10 yr was different. I imagine Vanguard would know it's own 10 yr return. Not sure what to make of it.

[G]

Don't look now, G ! CityVest Pathfinder just today dropped a bit north of 10% my initial investment into my checking account.

Ha, good to hear it arrived in 2021!
Glad the communication comes from an anonymous internet forum as opposed to the company itself!
I'll have to wait for the check--I didn't feel comfortable leaving my banking info with them.

[Tim]

That's the key Nysoz, they are not essentially the same asset class, on many levels.
One level, VNQ hold office, industrial, retail, hotels. These funds do not.
Another level, VNQ hold large cap buildings, these are smaller (and potential more profitable). They hold more 100-300 unit apartment complexes and do so more directly. I don't think VNQ is holding these mult-family apartment complexes.
VNQ has a significant correlation to the S&P500, these funds less so.

There seems to be some confusion or miscommunication here. The investment type, public vs private is the huge difference. Asset class is an asset type, not dependent on which subclass or asset, not the size of the specific asset used for security or investment.. A development stage project has higher risk and timeline risk than a completed and operating project. All can be real estate related, different niches within an asset class.

[afan]

Nobody said anything about guaranteed returns. Illiquidity does tend to yeild higher returns, however, and for good reason.

The 10-year return for VNQ is 9.72%, not REITs as a whole. The benchmark 10-year comparison is at 5.52% (see attachment). There is no reason to presume VNQ will outperform the benchmark simply because it has historically.

It depends on why something is illiquid.

You cannot increase the return to VTI by signing a contract that prevents you from selling for a decade. You still get the return of VTI.

If there are ready liquid alternatives to invest in the same thing, then there will be no premium for accepting illiqidity.

I have looked but have not found evidence that these illiquid real estate funds have higher returns than the REIT market. There are some data suggesting that REITs, on average, have HIGHER returns than does private real estate. There are some, limited, data indicating a lower correlation with stocks. Unfortunately, the difference is pretty small. Private real estate has a far higher correlation with stocks than do bonds.

I have to look it up again but I think the correlation with the stock market as a whole is around 0.65 for REITS and 0.55 for private real estate. Right direction but small effect.

Given the high idiosyncratic risk of these deals, any one of them could have a correlation with the stock market that is far higher or lower than for private real estate on average. I have not seen any data on the predictability of these correlations. MAYBE one can pick deals with lower correlation, but absent data, any expectation of being successful in finding these low r funds is just wishful thinking

[G]

Don't look now, G ! CityVest Pathfinder just today dropped a bit north of 10% my initial investment into my checking account.

I just checked. No Pathfinder distribution is noted in my account.

Very interesting, no?

Not shady at all.

[VagabondMD]

I just checked. No Pathfinder distribution is noted in my account.

Very interesting, no?

Not shady at all.

Not posted in mine, either, but the money is in my bank account.

[G]

Not posted in mine, either, but the money is in my bank account.

Got the check today. It is dated for 1/5/22. Interesting that it will be income for 22, as opposed to 21--since I assume that there is still a 2021 Q4 distribution coming?

Still no documentation on the "award winning" investor's portal.

[G]

Got the check today. It is dated for 1/5/22. Interesting that it will be income for 22, as opposed to 21--since I assume that there is still a 2021 Q4 distribution coming?

Still no documentation on the "award winning" investor's portal.

I am assuming nobody has heard about a K-1 from CityVest Pathfinder. The "portal" lists the distribution for 12/30/21, but the check is listed as 1/5/22. So...when I file for my extension, do I estimate the income for 2021 or not? And what happens when you find out after the filing deadline that you should have filed in states that you didn't even know about?

And by the way, since it is almost time for the Q1 report, did anybody hear about 2021 Q4 or 2021 Q3?

Sorry, VagabondMD , on a hassle : profit analysis, this is the worst investment I've ever made.

[The White Coat Investor]

I am assuming nobody has heard about a K-1 from CityVest Pathfinder. The "portal" lists the distribution for 12/30/21, but the check is listed as 1/5/22. So...when I file for my extension, do I estimate the income for 2021 or not? And what happens when you find out after the filing deadline that you should have filed in states that you didn't even know about?

And by the way, since it is almost time for the Q1 report, did anybody hear about 2021 Q4 or 2021 Q3?

Sorry, VagabondMD , on a hassle : profit analysis, this is the worst investment I've ever made.

Kind of early to be complaining about K-1s. I only have 2 of the 15-20 I'm expecting. I still don't have the one from my physician partnership, WCI, PIMD, POF, or the syndication where I'm the chairman of the board, much less most of my real estate investments.

[VagabondMD]

I am assuming nobody has heard about a K-1 from CityVest Pathfinder. The "portal" lists the distribution for 12/30/21, but the check is listed as 1/5/22. So...when I file for my extension, do I estimate the income for 2021 or not? And what happens when you find out after the filing deadline that you should have filed in states that you didn't even know about?

And by the way, since it is almost time for the Q1 report, did anybody hear about 2021 Q4 or 2021 Q3?

Sorry, VagabondMD , on a hassle : profit analysis, this is the worst investment I've ever made.

K-1's? LOL. Talk to me in two months! For the purposes of immediate tax planning, I might assume that our entire distribution from the past year is ordinary taxable income, to be on the safe side. That is probably overly conservative, but this will reduce the chance of any negative tax surprises. I would also assume that the same four states as last year (CA, CO, AZ, and OR) are in play.

I did get a recent and unexpected Medical Properties distribution, FWIW. As the @whitecoatinvestor says, you cannot properly assess the success or failure of a private real estate investment until it has gone full circle. Judging by our similar attitudes and comments, you and I are probably just not cut out for these deals. It just took me longer (and two additional investments) to learn this.

I do believe in the end that these CityVest investments are going to turn out just fine.

[TheDangerZone]

I think this thread and the experienced shared have been helpful to me. I can see how these investments might not be my favorite asset class to deal with between the uncertainty and the taxes and they calms my FOMO. It does sound like they’ve worked out well in the end for investors who have committed. Just not for me.

[SteffanW]

I had an e-mail exchange with Alan on this topic that was promising/informative (I did have to e-mail one of his colleagues a couple times recently to get a response to one of my recent e-mails but Alan did eventually respond).

Me:
Hello Alan,

I'm sure there is a reasonable explanation, but I'd like to inquire as to why I have received only 4 distributions (10/19/20, 2/2/21, 8/17/21, and 10/13/21) for the NEMI II fund but the NEMI FUND II Q4 2021 Report shows 7 distributions in the Manager's Report (see image).

Alan:
Hello Steffan,
I hope you have been well. The March distribution was received yesterday. So let’s call it 6 distributions, not 7. We made 4 distributions, rather than the 6 we received. Your questions is what happened to 2 distributions.

Obviously the distributions made by New Era in March and June 2021 were paid as one distribution in August 2021. So that’s one skip. And then the distribution that should have been made in December 2021 was skipped. The reason for the two skips is that CityVest tends to take our fees every six months so it reduced the distribution amount so low (some investors would have gotten just a $50 distribution and they have me wiring them the funds for $30 a wire). The fees in December did not consume the distribution and we had a bit left over from the December distribution, so this March distribution you should be getting around $420, which is an annualized 3.4%

[MaxPower]

I had an e-mail exchange with Alan on this topic that was promising/informative (I did have to e-mail one of his colleagues a couple times recently to get a response to one of my recent e-mails but Alan did eventually respond).

Me:
Hello Alan,

I'm sure there is a reasonable explanation, but I'd like to inquire as to why I have received only 4 distributions (10/19/20, 2/2/21, 8/17/21, and 10/13/21) for the NEMI II fund but the NEMI FUND II Q4 2021 Report shows 7 distributions in the Manager's Report (see image).

Alan:
Hello Steffan,
I hope you have been well. The March distribution was received yesterday. So let’s call it 6 distributions, not 7. We made 4 distributions, rather than the 6 we received. Your questions is what happened to 2 distributions.

Obviously the distributions made by New Era in March and June 2021 were paid as one distribution in August 2021. So that’s one skip. And then the distribution that should have been made in December 2021 was skipped. The reason for the two skips is that CityVest tends to take our fees every six months so it reduced the distribution amount so low (some investors would have gotten just a $50 distribution and they have me wiring them the funds for $30 a wire). The fees in December did not consume the distribution and we had a bit left over from the December distribution, so this March distribution you should be getting around $420, which is an annualized 3.4%

Seems like that should have been an easy, pre-emptive email to send out to everyone, rather than something you had to chase down through an email.

[SteffanW]

Seems like that should have been an easy, pre-emotive email to send out to everyone, rather than something you had to chase down through an email.

Yes, that did cross my mind.

[G]

Kind of early to be complaining about K-1s. I only have 2 of the 15-20 I'm expecting. I still don't have the one from my physician partnership, WCI, PIMD, POF, or the syndication where I'm the chairman of the board, much less most of my real estate investments.

Yes, it is kind of early to be complaining about K-1s. That said, IIRC, the underlying investment had the K-1 to CityVest well before regular deadline, but CityVest was unable to turn this around to the access fund investors.

But I was also complaining about the discrepancy in the distribution dates, FY 21 or 22, because that matters how much I pay The Man with my extension, right?

And I was also also complaining that it's been 7 months since the last quarterly update, because, you know, it isn't called a semi-annual or annual update.