When it comes to transparency in real estate, it seems like everyone boasts how they offer it, but few people are able to fully deliver on their promises. After all, just as chefs have their “secret sauces” and search engines have their “proprietary algorithms,” real estate investors who provide investment opportunities on a large scale tend to have at least a few “connections” that are hard to nail down in terms of value. But without which the entire operation would fall apart.

Transparency is a Must

“That doesn’t matter anymore, though. You have to be transparent whatever the cost,” said Charles Sells, founder and CEO of Platinum Investment Properties (PIP) Group during a training session at Think Realty’s National Conference & Expo in Atlanta, Georgia. “Transparency is the biggest thing you can offer an investor, and you have to offer it these days,” he insisted, noting that PIP itself recently invested hundreds of thousands of dollars and multiple years into the development of a proprietary software that lets investors track all of their investments with the company every single step of the way.

“We found that we simply could not afford to not make this information available,” Sells, Think Realty’s 2016 Master Investor, went on. He explained that when you work with passive real estate investors who trust you with their capital and, in return, expect you to manage their investments and generate returns, any miscommunication can be disastrous. To address this burgeoning issue that is growing daily thanks to a society based centrally around instant gratification from same-day delivery of groceries to the overnight appearance of major purchases.

The Facets of Transparency

Sells said that transparency now includes the following mandatory facets:

1| Fast, easy communication and response
Investors must know they have been heard and when they will see action in response to their requests.

2| Total control of assets
Passive investors may not want to manage the daily processes involved in their real estate investments, but they do require the peace of mind that comes from being able to check in at any time, in real time.

3| Near-instantaneous updates
Sells explained how part of the good faith involved in managing real estate investments hinges on delivering even when an investor is not looking. Update everything as quickly as possible and on an individual level. “This is one of the most important things we’ve done with our transparency over the last three years, and no one else offers anything like it,” he said.

Curious Investors

Sells said that passive investors often are particularly interested in their investments when something is about to change. For example, since PIP handles tax lien investments as well as more traditional flips, rehabs, and rentals, investors often are interested in watching the money flow from one step to the next during the lien redemption process even if they do not monitor the investment closely the rest of the time.

“We make sure we’re tracking in real time with them and prepared to track down the source of any discrepancies,” he said. “For example, if your lien redeems but the funds are not appearing in your self-directed IRA account, we’re right there with you finding out whether the issue is with the county government or your IRA custodian.”

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Carole Van Sickle Ellis is the editor-in-chief for Think Realty Magazine. You can reach her at cellis@thinkrealty.com.

  • Carole VanSickle Ellis

    Carole VanSickle Ellis serves as the news editor and COO of Self-Directed Investor (SDI) Society, a membership organization dedicated to the needs of self-directed investors interested in alternative investment vehicles, including real estate. Learn more at SelfDirected.org or reach Carole directly by emailing Carole@selfdirected.org.

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