How Realbricks Works: A Guide to Fractional Real Estate Investing

Learn how Realbricks enables investors to purchase ownership interests in entities that own single-family rental homes, how the investment process works, what investors may receive, and the risks to consider. 

A Different Way to Access Real Estate Investing

Real estate has historically been an asset class that investors have used as part of a broader investment strategy. A popular form of real estate investment is renting the property to tenants.. Traditional ownership of rental property often requires purchasing an entire property, arranging financing, managing operations, and handling all responsibilities associated with being a landlord. .

Realbricks reduces these traditional barriers to accessing real estate investment. Realbricks provides a platform that allows investors to purchase ownership interests in a company that owns individual single-family rental homes. Through this structure, investors may participate in a specific property investment without purchasing the entire home or managing the property directly. .

This guide explains how fractional real estate investing with Realbricks works, what investors own, how potential distributions are determined, and the risks and limitations associated with these investments.

About Realbricks 

Our mission is to help more people participate in real estate investing by providing transparent, accessible investment opportunities designed to support long-term financial goals. Through the Realbricks platform, investors are able to access fractional ownership opportunities involving single-family rental properties.The platform is led by Founder and Chief Executive Officer Chris Gerardi, alongside a team dedicated to optimizing technology, real estate operations, and investor experience.

Securities offered through the platform are held through a Series LLC that owns the property. Terra Mint Group Corp. provides the property management. Broker-dealer services are provided by Dalmore Group, LLC, a registered broker-dealer. Investor funds are held in escrow through a third-party escrow provider during the investment process. .

What fractional real estate investing means

Fractional real estate investing allows multiple investors to purchase ownership interests connected to a single property rather than purchasing the entire property individually.

When Realbricks acquires a home, that property is placed into its own separate legal entity. The investment opportunity for that property is then divided into ownership interests, or shares, priced at $10 per share.

When you invest, you are purchasing these shares in the entity that owns the property. You do not directly own the home, your name is not placed on the property title, and you do not have direct ownership of the physical real estate. Instead, you own an interest in the legal entity that owns that specific property, along with other investors who purchase interests in the same series.  

This is what "fractional" means: many investors each own a fraction  of the total interest in the  property. The minimum investment amount is $100, subject to the terms of each offering. Investors should review the offering documents for each property before making an investment decision.

A step-by-step guide for investing with Realbricks

Getting started follows a straightforward path:

  1. Create an account through the Realbricks platform. Choose to sign up on the Realbricks app or website. In order to create an account, you will complete a short process to verify your identity, a standard requirement for regulated investments.

  2. Connect your bank. Securely link a bank account to fund your investments.

  3. Browse available offerings.Each offering includes information about the property, investment terms, financial projections where applicable, and related offering documents. Investors should review these materials carefully, including information about risks, fees, assumptions, and limitations.

  4. Select an investment amount. Investors choose the amount they would like to invest, subject to the minimum investment amount of $100 and the terms of the applicable offering.  Complete your investment directly on the Realbricks platform.

  5. Track your portfolio. After investing, investors may access information about their holdings and any distributions that may be made through their  account.

What Investors own, and what they might receive

Investors acquire ownership interests in a company that owns real estate. Realbricks manages property acquisition, tenant placement, and ongoing property management services.

If a property is rented and generates net operating income from the lease, investors may receive distributions based on the terms of that applicable offering. Distributions are not guaranteed and depend on factors such as whether the property is leased, rental income collected, operating expenses, reserves, and other property-level expenses. . 

For properties that are newly constructed or not yet leased, rental income is not generated until a tenant occupies the property and rent payments begin. 

Real estate should be understood as an investment with a long time horizon that will include fluctuations in property values over time.The value of a property may increase or decrease over time based on factors such as local market conditions, property condition, operating performance, interest rates, economic conditions, and other variables. Any potential increase in property value is not guaranteed and would generally only be realized if the property is sold or through another approved liquidity event. 

Understanding risks and Investment considerations

Real estate investments involve risks, and fractional real estate investments with Realbricks are no exception. Investors should carefully consider these risks before investing. 

Fractional real estate investments are intended to be long-term investments. By way of example, traditional real estate investments are held for 5+ years. They are considered illiquid, meaning there is currently no public market where investors can sell their interests on demand.  

Realbricks is exploring opportunities to provide a secondary marketplace in the future where investors could potentially list shares for sale. However, no secondary market currently exists, , there is no guarantee that one will be established, and there is no assurance that an investor would be able to sell shares if a secondary market becomes available..  Investors should consider whether they can hold an investment for an extended period and whether they may need access to those funds before investing. 

Distributions are not guaranteed.Any projected distributions are estimates based on assumptions regarding factors such as rental income, expenses, occupancy, and property operations. Actual results may differ from projections.  

Real estate values fluctuate. A property's market value may be affected by local conditions, broader economic factors, changes in interest rates, supply and demand, and other circumstances. 

Investors acquire ownership interests in a company that owns real estate. . These ownership interests  are securities offered under Regulation A, and these offerings are qualified by the SEC. "Qualified" means the offering materials have been reviewed by the SEC for compliance with applicable disclosure requirements. SEC qualification does not mean the SEC has approved, endorsed, or recommended the investment, nor does it guarantee investment performance. 

Investors should review the applicable offering circular and related documents before investing. 

What Realbricks handles for you

Once you invest, Realbricks manages the operations:

Acquisition: We source and purchase the homes, with a current focus on new-construction single-family rentals built by one of the nation's largest home builders.

Management: Tenant placement and day-to-day property management activities are covered. Property management expenses are paid according to the terms disclosed in the applicable offering documents. 

Reporting: Investors can access information regarding their investments and any distributions in their Realbricks account.

Fees: Realbricks charges fees on available offerings related to services provided through the platform, including transaction fees, property management fees, and assets-under-management fees. The fees applicable to each offering are disclosed in that offering's documents, which we encourage you to review before investing.

Getting started

You can explore available properties and open an account on the Realbricks app or at realbricks.com. Take time to review the information provided for each offering and consider whether the investment structure, risks, and potential outcomes are consistent with your own financial situation and investment objectives. 

Disclaimer: Investing in real estate involves risk. This article does not constitute investment advice. Prospective investors should conduct their own due diligence and consult with financial advisors before making investment decisions.