Fairway America was founded in 1992 by its CEO and Chief Investment Officer, Matt Burk. Fairway coined the term “Small Balance Real Estate” (SBRE) in 2012 and with it defined the common thread of an industry. Fairway has been investing in SBRE deals since then and managing its own discretionary SBRE funds since 2001. Since 2012, Fairway has helped to architect, structure and create more than 125 funds and syndications for other SBRE entrepreneurs and managers around the United States. Fairway’s core business strategy is to identify, create and engage in long-term relationships with high quality SBRE stakeholders, which includes both SBRE entrepreneurs and investors. As both SBRE entrepreneurs and investors ourselves, we have a visceral understanding of the space.
What Is Small Balance Real Estate?
SBRE refers to any real estate asset-based investment opportunity that is non-institutional in size, scale and scope. This includes a wide variety of real estate asset-based strategies and types including private money lending, value-add direct acquisition of real estate (multiple asset types both residential and commercial), acquisition of distressed or discounted debt, and much more. SBRE transactions represent a large percentage of the total volume of real estate transactions in the United States1. SBRE is a highly fragmented market with opportunities to potentially generate attractive risk-adjusted returns for investors.
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An SBRE Entrepreneur is anyone running a business that originates and/or acquires real estate-based assets of some type and who must regularly and repeatedly raise capital from investors (most often non-institutional investors) in order to fund all or a portion of the acquisition of those assets. There are many thousands of SBRE entrepreneurs around the United States.
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Accredited Investors, a term defined by the Securities and Exchange Commission (SEC), must meet certain criteria to obtain special status under financial regulation laws which provides access to complex and perceived higher-risk investments such as SBRE, venture capital, hedge funds and angel investments.Generally, accredited investors include high-net-worth individuals and entities, banks, and other financial institutions. Fairway America and many other SBRE entrepreneurs work mostly with high net worth accredited investors as a primary source of capital for their SBRE businesses.
For more information on whether or not you qualify please see the SEC explanation (pdf) of an accredited investor.
1. According to CoStar
Why Work with Fairway America?
SBRE entrepreneurs need to raise capital in order to execute their SBRE business plans. Investors who seek alternative investment opportunities want to invest in quality deals to maintain and grow their wealth. Fairway America provides a platform built on high integrity, mutual trust, and rigorous due diligence to help bring both sides together. We vet deals for our Funds and often make those same deals available to investors to help raise greater capital for what we believe are quality SBRE entrepreneurs.
What Is the Marketplace?
Powered by the experienced team at Fairway America, the marketplace is a real estate investment opportunity listing service that provides accredited investors with access to a variety of SBRE offerings across the nation, including Fairway’s proprietary investment funds. Fairway scrutinizes, through its own rigorous underwriting process, every deal offered on the marketplace, including the real estate entrepreneurs behind the deal, and makes much of this information available on the site. Fairway’s discretionary investment funds typically invest into many of these opportunities as well as making them available to our investor base.
How Can Investors Access the Marketplace?
Each prospective investor must certify that he or she is an “accredited investor,” as that term is used by the SEC. We strive for quality over quantity and spend the time to understand who our investors are and what and how they intend to utilize the site. Fairway will review and talk to each investor who requests access to the site. Only approved investors may browse the deal room for current offerings. Fairway America reserves the right to revoke access to any investor. Investors must verify their accredited status before actually making an investment with Fairway.
How Can SBRE Entrepreneurs be Listed on the Marketplace?
Deals listed on the marketplace must pass through Fairway’s rigorous due diligence. Examples of steps we take before listing any opportunity on our marketplace include, but are not limited to, comprehensive and ongoing background checks on SBRE entrepreneurs, a thorough review of their offering documents and financial projections, a sample verification of their performance on prior deals, a deep dive review on their underwriting assumptions and approaches, and more. To learn more, please contact Kellen Stevens at firstname.lastname@example.org.