Tampa commercial real estate broker David Sobelman, a national expert in net leases, where the tenant pays some or all property expenses, in addition to rent, senses a shift in the niche market.
In an effort to get ahead of that shift, Sobelman seeks to raise $20 million for a new Real Estate Investment Trust, Tampa-based Generation Income Properties. Shares are being offered at $5 each, and there is no minimum purchase. The REIT is one of the first nationwide to successfully file under the Securities and Exchange Commission's Regulation A+, according to a statement. The new regulations, under the 2012 federal JOBS Act, allow for what's essentially a mini-IPO.
Sobelman's strategy with Generation Income is to zig where others in commercial real estate zag. That particularly goes for competitors who might have over-reached in the current market rebound, and are too short-term focused.
“We believe there is a current trend to purchase U.S. net lease properties that provide the highest return possible, which in our estimation causes investors to purchase assets in less desirable locations with lower real estate values,” Sobelman states in the SEC filing. “In our estimation, this leaves an opportunity to purchase prime net lease real estate assets that are not being sought out by institutional owners. With the vast amount of similar REITs currently seeking assets that provide an immediate return, we believe that many assets are being overlooked.”
Generation Income Properties targets only investments in the top 20 highest density U.S. cities. Sobelman, in a statement separate from the SEC filing, adds the company believes its “low leveraged approach to acquiring properties clearly differentiates itself from its colleagues in the same industry as well as other public net lease REITs.”
A Sarasota native, Sobelman worked for the travel and logistics planning team in the White House during Bill Clinton's presidency before he got into real estate. He launched the Tampa office for Reston, Va.-based Calkain Cos. in 2006, and in 2010, with Calkain President and CEO Jonathan Hipp, he wrote “The Little Book of Triple Net Lease Investing.”