A Limited Partnership is a legal entity which together with a general partner (GP) holds the properties we acquire. Effectively, the Limited Partnership ‘owns’ the properties. Collectively, everyone who buys Units of the Limited Partnership is a part-owner (Investors).
Our Investment Offering are RRSP, RESP, LIRA, RIFF, TFSA Eligible and eligible for cash investment.
A Limited Partnership is a legal entity that allows a group of investors (Limited Partners) to pool their investment money and buy multiple properties together. Usually, the Limited Partners don’t know each other, and normally they aren’t involved in the management of the real estate.
A General Partner (a company) manages all the day-to-day activities of the Limited Partnership on behalf of the Limited Partners. Activities include: buying properties, collecting rent, paying mortgages and taxes, maintenance, repairs, upgrades, and all tenant management. This makes Limited Partnerships a great ‘hassle-free’ way to invest in real estate.
At Pulis Investment Group, we prefer Limited Partnerships for a number of reasons:
Real Estate is a straight-forward asset.
Real Estate is something that most people understand. It’s tangible—you can touch it. Everyone lives somewhere.
Well-selected and well-managed real estate can deliver healthy profits. According to the great industrialist Andrew Carnegie: “Ninety percent of all millionaires become so through owning Real Estate.”
Invest in real estate without any of the normal landlord responsibilities: rent collection, tenant management, maintenance, repairs, bookkeeping, accounting, etc.
Each investor ‘owns’ a (proportionate) share of each property.
Instead of owning a single property, each investor owns a small portion of each property in the entire portfolio, and therefore shares in the total profit. If there happens to be one property that develops a problem, the problem is resolved by the General Partner, and no single partner is responsible for the problem—only their small share. A little like buying Insurance.
The Partnership is a Limited Partnership.
This ‘limits’ any single investor’s risk to the amount invested. Nothing more. Ever.
In some cases, depending on an Investor’s individual situation, there may be tax advantages to investing via a Limited Partnership.
We recommend that you consult with your financial advisor(s) and accountant to determine how a specific Limited Partnership could benefit you personally.
Deferred Plan Eligibility (RRSP, TFSA, etc.)
Some Limited Partnerships are eligible investments for ‘Deferred Plans’.
A ‘Deferred Plan’ is an investment account that allows for taxes to be deferred or paid at a later date. Two common examples of Deferred Plans are Registered Retirement Savings Plans (RRSP) and Tax Free Savings Accounts (TFSA).
Growth vs. Income Options
Limited Partnerships can be structured for Growth or Income, or a combination of both.
An Income-focused Limited Partnership will pay out periodic (i.e. quarterly, annual, monthly) payments to its investors. Some investors are looking for regular income (i.e. those who are retired), and an Income-focused Limited Partnership can be an excellent choice.
A Growth-focused Limited Partnership makes most or all of its payments to investors at the end of the term. This allows more of the invested capital to work for a longer period of time, and this structure is intended to generate higher overall returns. For investors looking for higher potential returns and those without a need for regular income (i.e. RRSP or TFSA investments), a Growth-focused Limited Partnership is often a preferred choice.