15% is our target annual IRR (Internal Rate of Return).
This is 3 times the S&P 500 over the past 20 years which performed at 4.23%.
It is 500 times a Bank of America savings accounts at 0.05%.
We pay out dividends Quarterly.
A 15% IRR means that over the 5 year life of the fund, our goal is that your average annual return will be 15%.
It does NOT mean that you get $1500 on a $10,000 investment every October 1st.
Given that this is opportunity fund, for the first 6-9 months, the returns might only be in the single digits, because we are acquiring the property and rehabbing and there is no major cash flow.
But in years 3-5, the returns may be 12%-15% once everything is up and running and rented.
As a result, the average over 5 years ends up approaching 15%.