Trion Properties Review: Multifamily Real Estate Investing
Trying to make the most of trion properties review multifamily? You are in the right place. Below we break it down in plain English, with practical tips you can actually use.
Key Takeaways
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Trion Properties is a multifamily real estate investment syndicate. In this Trion review, we’ll examine how it works and explain the types of investors who stand to benefit from the company’s hands-on, vertically integrated approach.
4.1/5Trion Properties has a strong track record and is worth consideration for high net-worth accredited investors. Its key differentiator from other real estate platforms is that the entire operation is done in-house, including underwriting, buying, renovating and managing the rentals. There’s an opportunity to invest directly in a single property or in multiple properties through a fund. However, their complex fee and distribution structure makes it a better fit for more advanced real estate investors.
Pros:- In operation since 2005.
- Relies on in-house, tightly controlled property management.
- Has a solid track record and IRR.
- Minimum $50,000 investment.
- Distributes returns via a waterfall.
- Complicated fee structure.
- Limited properties available.
Table of Contents
ToggleTrion Properties: The Basics
Los Angeles based Trion is a private investment fund in operation since 2005. Unlike platforms that act as investor-facing cogs in a larger chain, Trion purchases, underwrites, and manages all their investments
While Trion primarily began acquiring properties in California, Oregon and Colorado, the company is now focusing with equal effort in the southeastern United States. Roughly half of the investment opportunities available at the time of publication are located in Florida, Georgia and North Carolina.
In 2021, Trion closed on nearly $500 million in assets between Los Angeles and Miami.
Types of Properties on Trion
Trion can be viewed as a “rehab” property investment vehicle because it seeks out what the firm describes as value-add projects driven by the acquisition of “underutilized” properties in rising markets. Trion converts these underutilized multifamily properties into more modern, attractive and affordable rentals.
Here’s an overview of the Trion process:
- Sourcing begins for the purchase of multifamily properties at attractive valuations. Access to transportation and major employers is factored heavily during property selection.
- Properties pass the initial screening stage and then undergo modeling to determine potential.
- Trion also identifies optimal capitalization structure during the decision period to avoid leveraging pitfalls. Property-specific scenario modeling, stress tests, and sensitivity analysis of exit cap rates are also performed.
According to Trion, the ideal building is a blank canvas that has remained untouched for at least 10 years. Trion prefers imperfect properties that allow for custom updates that unlock maximum investment potential in the current market. Trion reviews about 100 deals for every property it purchases.
Once a property is purchased, Trion manages the renovations. Acquired properties undergo renovations designed to boost investor return by optimizing rent potential, increasing lease renewals, and reducing vacancies.
How You Make Money
Trion investors are free to “shop” for the properties they like from a list of current opportunities. In addition, Trion periodically launches funds that allow you to invest in multiple properties at once.
Their newest fund, Trion Multifamily Opportunity Fund IV, LLC, launched in February 2023 and is expected to contain between 8-12 total properties.
Investors receive both dividends based on the property’s revenue and potential appreciation minus costs and fees (discussed below).
The average hold time for Trion properties ranges from three to 10 years. As of Q1 2023, Trion has purchased 84 properties since inception and exited 40.
Costs and Fees
The fee structure varies by property and fund type and is complex for novice real estate investors. Unlike some alternatives discussed below, there is no set fee management fee.
Funds on Trion pay out profits via a “promote” structure.
In private real estate investing, “promote” is a form of compensation paid to a fund’s sponsor (in this case, Trion) using the fund’s cash flow to incentivize the sponsor to ensure a profitable project. In other words, the better the property, the better Trion does (and, of course, the better you do).
Trion then offers “breakpoints” for higher levels of investment, or for investing in a fund in its early stages.
In private real estate investing funds, breakpoints refer to tiered levels of promote that are offered to investors based on the amount of their investment. These breakpoints are used to encourage higher investment levels and to reward investors who commit more to the fund.
Breakpoints are typically offered when a fund is in capital-raising mode.
Trion vs. Alternatives
Trion’s business model, while similar to that of other popular crowdsourced real estate platforms, sets itself apart in several ways.
Notably, the company operates similarly to a private real estate syndication firm, which may deter some investors who prefer more accessible options. However, the restrictive pathway to entry also provides a level of exclusivity that could appeal to certain investors.
Trion vs. Fundrise
Fundrise represents a completely different end of the spectrum from Trion.
Fundrise is open to non-accredited investors who can participate on the platform for a minimum investment of $10. Even Fundrise’s Advanced tier , which requires a minimum investment of $5,000 and accreditation status , doesn’t come close to Trion’s $50,000 minimum.
With a portfolio totaling $7 billion, Fundrise is obviously much larger than Trion.
See our Fundrise review to learn more.
Trion vs. Crowdstreet
Final Thoughts
The bottom line: a little research on trion properties review multifamily goes a long way. Compare your options, watch for seasonal offers, and never pay full price when a better deal is one click away. Originally published at thewaystowealth.com.
R.J. Weiss
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