Direct Participation Programs
Accessing Alternative Investment Strategies

Working with our experienced professionals, you can incorporate direct participation programs (DPP) into your portfolio. These programs pool qualifying investors’ funds to make investments that the sponsor has identified as appropriate to its goals. Most DPPs require a minimum investment and participation for at least a minimum term. DPPs are limited partnerships that can take many forms, including:

Non-Traded Real Estate Investment Trust (REIT)

A Non-Traded Real Estate Investment Trust (REIT) is a privately held corporation that owns and manages buildings or building mortgages and sells shares to qualified investors. All REITs provide certain tax advantages, including the right to claim depreciation expenses against dividend income. However, returns on a non-traded REIT may have a low correlation with the returns experienced by publicly traded REITs. As opposed to publicly traded REITs that may be illiquid. It is important to speak with an advisor to find out if Non-traded REITs are right for you.

Equipment Leasing Trusts

An equipment leasing trust purchases equipment using financing provided by equity investors and a lender, then leases that equipment to a lessee who signs a contract to pay rent that will cover principal and interest to the lender, dividends to the investors, and a fee to the owner trustee. Returns on non-traded leasing programs may be low correlated with the returns experienced by publicly traded companies who may also lease equipment and additionally may be illiquid.

Developmental Drilling Program

A developmental drilling program explores for oil or gas in areas close to existing productive sites, increasing the probability of success. Such a program may limit investor risk but typically provides a more limited return than successful speculative drilling programs. Returns on a non-traded drilling program may be low correlated with the returns experienced by publicly traded energy companies pursuing similar endeavors. Developmental Drilling Programs may be illiquid and may not be appropriate for everyone.

Non-Traded Business Development Company (BDC)

BDCs are closed-end funds with the goal of generating current income and/or capital growth. The BDC structure provides retail investors direct access to the private equity and private debt investment markets. Due to high investment minimums and limited access these investments they were previously available to high-net-worth and institutional investors only. The BDC brings this market within reach to the ordinary investor. BDCs still may be illiquid or have minimums or suitability requirements so it is important to speak with an advisor prior to investing.

Energy Programs: Gas and Oil Royalties

Gas and oil royalties are a percentage of the value of the gas or oil produced from leased property that are paid to the property owners as required by the lease contract. The royalties may be purchased and packaged for resale to qualifying investors or as a like-kind replacement in a 1031 Exchange. These may be illiquid and may only be offered to accredited investors, please speak with an advisor before investing.

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