Bluerock Capital Markets Reports $986 Million of New Equity Capital Inflows in 2020 and Achieves #1 Ranking in Capital Raise and Total Returns Across Multiple Investment Programs
The DI Wire – Bluerock Capital Markets, LLC (“BCM” or “Company”), a distributor of institutional alternative investment products, and the dedicated dealer manager for Bluerock Real Estate (“Bluerock”), reported total equity inflows of approximately $986 million in 2020 across all investment programs, inclusive of distribution reinvestment. The Company also reported approximately $1 billion of average annualized equity capital raise over the prior four-year period. Per Robert A. Stanger & Company, BCM has ranked among the top sponsors in total capital raise in the Direct Investments Industry from 2017-20201.
In a year characterized by significant challenges and disruptions, Bluerock delivered standout performance with a multitude of #1 rankings amongst its two flagship, continuously offered investment programs, including:
- Bluerock Total Income+ Real Estate Fund: Highest Total Returning Real Estate Interval Fund in 20202
- Bluerock Total Income+ Real Estate Fund: #1 Real Estate Interval Fund Equity Capital Raise Post COVID-19 (April-December 2020)1,2
- Bluerock Residential Growth REIT: #1 Performing Common Stock of All Multifamily Sector REITs Listed on a Major Exchange in 20205
- Bluerock Residential Growth REIT: #1 Non-Traded Preferred Stock New Equity Capital Raise with Approximately 42% Market Share in 20201
“Capital tends to follow performance and we are very grateful and proud to have earned the #1 rankings as detailed above”, remarked Jeffrey Schwaber, CEO of Bluerock Capital Markets. “Bluerock’s leadership among the top alternative sponsors is a result of several factors, including providing access to high quality institutional investment products and managers, which have delivered high current income, tax efficiency, appreciation potential, and low pricing volatility”, added Schwaber.
“We are extremely pleased to have delivered to our valued financial advisors and shareholders the #1 return performance in both of our flagship investment products“, added Ramin Kamfar, Founder and CEO of Bluerock Real Estate. “I am proud of the extreme hard work of our entire organization and their dedication to the more than the 77,000 shareholders we serve’, added Kamfar.
2020 Highlights of Bluerock’s Investment Programs Include:
The Bluerock Total Income+ Real Estate Fund was the #1 performing real estate interval fund in 2020 and the #1 capital raising real estate interval fund in the direct investment industry from the onset of the pandemic (April – December) raising more than $646 million of new investor capital in 20201,2.
The Fund’s institutional share class (I-shares, ticker: TIPWX) delivered a total annualized return of 1.64% in 2020, the highest total return of all real estate interval funds2 and more than 900 basis points higher than the MSCI U.S. REIT Index, an index of leading listed public real estate. The Fund’s longest running share class (A-shares, ticker TIPRX) boasts a 7.10% annualized total return since its inception dating back to October 2012. The Fund has also delivered eight consecutive years of positive returns with no down years and with 29 of 32 positive quarters (90%+ of quarters) and has made 32 consecutive quarterly distributions to shareholders at a 5.25% annualized rate.
Further, the Fund has generated the single highest risk-adjusted return (as measured by the Sharpe ratio) as of 12.31.2020 among approximately 890 global real estate sector funds in the Morningstar universe of open-end, closed-end and exchange traded funds3. The Fund closed 2020 with significant growth in AUM and is the 6th largest interval fund among all 70 active interval funds4. Past performance is no guarantee of future results.
Bluerock Residential Growth REIT (BRG) posts #1 Return amongst all publicly traded multifamily REITs in 2020 with a 14.7% total shareholder return, to close at $12.72 at the end of the year5.
In addition to BRG publicly listed shares, the REIT issues non-traded (NT) preferred stock through its Series T preferred stock which was the standout leader in capital raise among its peers in 2020 with more than $242 million of new investor capital and approximately 42% market share of the NT preferred stock sector1. BRG has raised more than $740 million of NT preferred stock over time and has successfully retired and/or converted over $110 million previously issued preferred stock significantly improving its capital stack and reducing dividend liability.
BRG has paid 57 consecutive monthly dividends, all of which were paid from cash flows from operations, to its preferred stock shareholders at the stated annual dividend rate of 6.15% for Series T and has experienced no pricing volatility since their launch in April 2016. Further, the REIT recently announced 26 tranches of BRG warrants being “in the money”, affording the opportunity for those shareholders to potentially enhance their returns with potential capital appreciation through the exercise of their BRG warrants. Past performance is no guarantee of future results.
Bluerock Value Exchange successfully full-subscribed three sponsored DST programs in 2020 resulting in total acquisition of over $220 million in multifamily assets and maintained its position within the top quartile of sponsors providing 1031 exchange programs.
1 Sources: The Stanger Market PulseTM (December 2020). Figures include dividend reinvestment.
2 Source: Morningstar Direct, includes all real estate sector interval funds as defined by intervalfundtracker.com with AUM greater than $50 million.
3 Source: Morningstar Direct, annualized Sharpe Ratio, based on daily data from 1.1.2016-12.31.2020. Using Morningstar data compiled by Bluerock Fund Advisor, LLC, TIPRX received the highest Sharpe Ratio among approximately 890 open end, closed end, and exchange traded funds in the global real estate sector equity category for the five-year period ending 12.31.2020. TIPRX, no load. Sharpe Ratio and standard deviation are only two forms of performance measure. The Sharpe Ratio would have been lower if the calculation reflected the load. Investors may be eligible to purchase Class A share without load. Please see the Fund Prospectus.
4 Source: Intervalfundtracker.com (September 30, 2020)
5 Source: Morningstar Direct, based on total returns for common stock of publicly traded REITs classified as part of the multifamily sector by IQ Capital and SNL Financial for the period commencing 1.1.20 through 12.31.20.
TI+ A Share Fund Performance
6 Inception date of the fund is October 22, 2012.
7 The maximum sales charge for the Class A shares is 5.75%. Investors may be eligible for a reduction in sales charges.
The performance data quoted here represents past performance. Current performance may be lower or higher than the performance data quoted above. Investment return and principal value will fluctuate, so that shares, when redeemed, may be worth more or less than their original cost. For performance information current to the most recent month end, please call toll-free 1-844-819-8287. Past performance is no guarantee of future results.
The total annual fund operating expense ratio, gross of any fee waivers or expense reimbursements, is 2.21% for Class A. The Fund’s investment adviser has contractually agreed to reduce its fees and/or absorb expenses of the fund, at least until January 31, 2021, to ensure that the net annual fund operating expenses will not exceed 1.95%, per annum of the Fund’s average daily net assets subject to possible recoupment from the Fund in future years. Please review the Fund’s Prospectus for more detail on the expense waiver. A Fund’s performance, especially for very short periods of time, should not be the sole factor in making your investment decisions. Fund performance and distributions are presented net of fees.
A summary of Bluerock’s three distinct investment programs include:
About Bluerock Total Income+ Real Estate Fund
Bluerock Total Income+ Real Estate Fund offers individual investors access to a portfolio of institutional real estate securities managed by best-in-class fund managers with more than $223 Billion of underlying gross asset value and ~4,300+ properties. The Fund’s primary investment objective is to generate current income while secondarily seeking long-term capital appreciation with low to moderate volatility and low correlation to the broader markets. The Fund utilizes an exclusive partnership with Mercer Investment Management, Inc., the world’s leading advisor to endowments, pension funds, sovereign wealth funds and family offices globally, with over 3,300 clients worldwide, and $15 trillion in assets under advisement.
About Bluerock Residential Growth REIT
Bluerock Residential Growth REIT, Inc. is a real estate investment trust that focuses on developing and acquiring a diversified portfolio of institutional-quality highly amenitized live/work/play apartment communities in demographically attractive knowledge economy growth markets to appeal to the renter by choice. BRG’s objective is to generate value through off-market/relationship-based transactions and, at the asset level, through value-add improvements to properties and operations. BRG reports assets in excess of $2.4 billion and more than 17,200 apartment units. BRG’s common stock is included in the Russell 2000 and Russell 3000 Indexes. BRG has elected to be taxed as a real estate investment trust (REIT) for U.S. federal income tax purposes.
About Bluerock Value Exchange
Bluerock Value Exchange is a national sponsor of syndicated 1031-exchange offerings with a focus on Premier Exchange Properties™ that seek to deliver stable cash flows and potential for value creation. Bluerock has structured 1031 exchanges on over $1.8 billion in total property value and over 10 million square feet of property.
About Bluerock
Bluerock is a leading institutional alternative asset manager with approximately $8.8 billion of acquired and managed assets headquartered in Manhattan with regional offices across the U.S. Bluerock principals have a collective 100+ years of investing experience, have been involved with over $13 billion in investments, and have helped launch leading private and public company platforms.
About Bluerock Capital Markets
Bluerock Capital Markets, LLC serves as the managing broker dealer for Bluerock and is a member of FINRA/SIPC. Formed in 2010, BCM distributes a broad range of institutional investment products with potential for growth, income, and tax benefits exclusively through broker dealers and investment professionals including the Bluerock Total Income+ Real Estate Fund, Bluerock Residential Growth REIT, Inc., and programs sponsored by Bluerock Value Exchange, LLC. BCM ranks #4 for capital fundraising in 2020 among all active managing broker-dealers in the Direct Investments Industry1.
Bluerock Residential Growth REIT’s Series T Preferred Stock and Bluerock Value Exchange’s programs are offered by Bluerock Capital Markets, LLC. The Bluerock Total Income+ Real Estate Fund is distributed by ALPS Distributors Inc. Bluerock Capital Markets, LLC is not affiliated with Alps Distributors, Inc. or Mercer Investment Management, Inc.
Sharpe Ratio: Measurement of the risk-adjusted performance. The annualized Sharpe ratio is calculated by subtracting the annualized risk-free rate – (3-month Treasury Bill) – from the annualized rate of return for a portfolio and dividing the result by the annualized standard deviation of the portfolio returns. You cannot invest directly in an index. Benchmark performance should not be considered reflective of Fund performance.
Disclosures
Bluerock Total Income+ Real Estate Fund
Bluerock Total Income+ Real Estate Fund’s primary investment objective is to generate current income while secondarily seeking long-term capital appreciation with low to moderate volatility and low correlation to the broader markets. Investing in the Bluerock Total Income+ Real Estate Fund involves risks, including the loss of principal. The Fund intends to make investments in multiple real estate securities that may subject the Fund to additional fees and expenses, including management and performance fees, which could negatively affect returns and could expose the Fund to additional risk, including lack of control, as further described in the prospectus. The Fund’s distribution policy is to make quarterly distributions to shareholders. The level of quarterly distributions (including any return of capital) is not fixed and this distribution policy is subject to change. Shareholders should not assume that the source of a distribution from the Fund is net profit. A portion of the distributions consist of a return of capital based on the character of the distributions received from the underlying holdings, primarily Real Estate Investment Trusts. The final determination of the source and tax characteristics of all distributions will be made after the end of each year. Shareholders should note that return of capital will reduce the tax basis of their shares and potentially increase the taxable gain, if any, upon disposition of their shares. There is no assurance that the Company will continue to declare distributions or that they will continue at these rates. There can be no assurance that any investment will be effective in achieving the Fund’s investment objectives, delivering positive returns or avoiding losses.
Limited liquidity is provided to shareholders only through the Fund’s quarterly repurchase offers for no less than 5% of the Fund’s shares outstanding at net asset value. There is no guarantee that shareholders will be able to sell all of the shares they desire in a quarterly repurchase offer. Quarterly repurchases by the Fund of its shares typically will be funded from available cash or sales of portfolio securities. The sale of securities to fund repurchases could reduce the market price of those securities, which in turn would reduce the Fund’s net asset value.
Investors should carefully consider the investment objectives, risks, charges and expenses of the Bluerock Total Income+ Real Estate Fund. This and other important information about the Fund is contained in the prospectus, which can be obtained online at bluerockfunds.com. The Bluerock Total Income+ Real Estate Fund is distributed by ALPS, Inc. The prospectus should be read carefully before investing. Bluerock Fund Advisor, LLC is not affiliated with ALPS, Inc.
Bluerock Residential Growth REIT
The discussion of BRG securities herein relates solely to BRG’s Series T Redeemable Preferred Stock, non-traded securities of BRG which have not been listed on any national exchange. The risks and rewards of investing in the Series T Preferred Stock are separate and distinct from an investment in BRG’s common stock listed on the NYSE American. This is neither an offer to sell nor a solicitation of an offer to buy any securities. An offering is made only by the prospectus. Any prospective investor must be read the prospectus in order to understand fully all of the implications and risks of the Series T Preferred Stock.