Frequently Asked Questions

What is a Limited Partnership?

A Limited Partnership (LP) is a legal means for like-minded investors to pool their resources for a defined business venture. A General Partner (GP) is given the authority to manage the defined business investment in the name of the Limited Partners (LPs) and has responsibility for the success of the business. The nature of the business, the roles and responsibilities of the GP, the profit sharing and all other aspects of the business are outlined specifically in the LP agreement. An LP is a provincially regulated legal vehicle to raise capital for a venture without the expensive overhead of a public company. In essence, the GP/LP relationship is similar to a trust, where an appointed trustee (the GP) manages the assets held by the trust (LP). Taurean Global Properties will act as the GP in all Taurean Global Limited Partnerships.

What is an Offering Memorandum?

An Offering Memorandum is the disclosure document that Taurean Global Properties must file with the various provincial security commissions. It allows both accredited (high net worth individuals or entities) and non-accredited investors to subscribe to an investment offering by a private issuer, regardless of the amount of securities purchased. The purpose of the Offering Memorandum is to provide full disclosure and detailed description of all aspects of the proposed investment. Non-accredited investors are also required to sign the Risk Acknowledgement Form in all provinces to indicate they have read and considered the contents thoroughly.

What are the benefits of joining a Limited Partnership?

Limited Partners within an LP are afforded several benefits through this investment structure, including the following:

1. Limited Risk – exposure is limited only to the amount invested, even in the case of a disaster or major lawsuit.
2. Clearly Delineated Responsibility – all aspects of the business are outlined in the Offering Memorandum (OM), including GP compensation, limitations, etc.
3. Loss Allocation – allocation of 100% of losses for potential tax savings (not uncommon in first 1-2 years of asset ownership due to start up costs, depreciation and Capital Investments in the assets).
4. Predictable Investment Timeline - value creation cycle takes approximately 5 years to yield maximum payoff.
5. Resale Potential for Units - Possibility to re-sell units to future partners within the limitations of the OM at a yearly defined price (increased yearly to reflect the value realized for current investors throughout the value creation cycle).
6. Proven Legal Framework – LP structure is a well used financial structure with oversight by federal and provincial financial regulators.
7. Regular Distributions – Quarterly cash flow from rental portfolio when positive cash flow achieved.

What if something should happen to the General Partner?

The Limited Partners can, in limited circumstances such as fraud, gross negligence, criminal activity or death of the owners of the General Partner, vote to change the General Partner.

How long has your company been in business?

Taurean Global Properties was founded by Douglas Thiessen in the December of 2007 and incorporated as an Alberta Corporation in the spring 2008.

What experience do you have?

The Taurean Global team has quite a breadth and depth of experience in both fund management and real estate investing. We have 30 years of combined experience in the financial industry and over 10 years of experience in repositioning distressed multi-family real estate assets.

What are the returns I can expect?

Your investment with Taurean Global are expected to be at least 15% on an annualized basis over a 5 year investment term. More often than not, we overachieve for our investors and have actually reached levels of 30% returns per year.

How am I protected?

As a limited partner, you have no business risk or liability associated with the operations of the Partnership's real estate portfolio. All operational liability is born by the General Partner. Your financial exposure is limited to the amount of capital you have invested in the partnership. Your investment entitles you to an ownership stake of an equivalent holding in the actual assets of the Partnership.

What term is the investment?

The term of the investment is 5 years. The Taurean Multifamily Enhancement System (TMES) is a systematic and proven system of creating value for our investors. In order for the TMES to create optimal value from the partnership's portfolio of assets, at least 5 years is required. We do allow for the early retraction of your investment. This early retraction is associated with a declining penalty over the course of the investment.

What happens at the end of the 5 years?

At the end of the 5 years, the partnership can decide the best course of action for the portfolio of assets. Several options exist and is chosen by the General Partner:

1. Liquidate the assets at the current market value and pay out to investors.
2. Remission of partnership units according to the agreed upon valuation formula in the Partnership Agreement.
3. Hold the portfolio and cash flow the assets providing a stable annuity to investors.

Where does my money go? 

Where do you invest, Canada, USA? Where in Canada?

We look for valuable distressed multi-family real estate assets all over Canada, the United States and even in international markets. To date we have only invested in properties here in Canada because we continue to find great deals and great returns for our investors. Due to the credit crisis, the overall financial situation and the oversupply of product in most US cities, our plan is to continue to invest in Canadian properties for the foreseeable future.

How have your past funds performed?

To date we have launched three investment funds, two multi-family real estate funds and one land-banking fund in Argentina. Our first multi-family fund, while closed to new investors, is still in progress and we have not liquidated any of the buildings in that fund to date. We are incredibly pleased with the progression of this fund thus far and a summary of the buildings is indicated in the chart below.

Limited Partnership 1:

Our second multi-family fund has three buildings already;

When do you distribute returns? Monthly? Quarterly? Annually?

When we are in a positive cash flow situation, we pay out quarterly.

Are your funds RRSP and TFSA eligible?

No, our current fund is not RRSP or TFSA eligible.

Are my returns capped?

No. Actual returns depend on the performance of the Partnership's portfolio of assets and economic conditions over the term of those investments. There is no cap on the returns other than these factors.

How does the General Partner make money?

As the General Partner, Taurean has structured the partnership to align our success with the general success of our investors.

1. Taurean is paid 15% of gross funds raised for structuring and assembling the partners in this business opportunity. Investors are paid back 100% of their investment before Taurean participates in equity upside.
2. The General Partner of each fund receives a yearly management fee of 1% of assets under management which incents us to increase the value of your investment quickly.
3. The General Partner receives 30% of all distributions from the partnership AFTER our investors have received their initial invested capital back.

Am I investing in one building or several?

You are investing in a partnership which will purchase and hold one or more buildings. You will own a representative share of ALL assets in this partnership.

How much leverage do you employ?

Each deal is as different as each asset we purchase. This decision is made on a case by case basis with the security of our investor's capital and several important cash flow metrics determining the leverage employed. Across the entire portfolio of investments, it is safe to assume an average leverage of about 75%.

After my initial investment will I be required to make any other investments?

You will not be required to make additional investments, however you will be invited to increase your participation as often as you like, until the partnership fund is fully subscribed. Taurean Global is continuously opening new, targeted partnership funds allowing you to participate, as you see fit, in the continued success of this proven business model.

How do I invest with Taurean?

Once you have assessed your personal financial objectives with a professional financial planner and decided to become a Limited Partner, simply fill out the following forms and return them to the General Partner: Offering Memorandum (White) Subscription Form (Green) Risk Acknowledgment Form (Blue) A check for your desired number of units must then be sent to the General Partner. We encourage you to contact us to discuss payment details. Upon receipt of the funds, you will be registered in the partnership and you will receive the necessary legal documents by mail within 10 business days.

How are Taurean Latitude Limited Partnership units valued?

All current LP units are initially priced at $1000 per unit. As the asset base expands and value is created, the unit values change. The price for units following the initial year are determined by the General Partner, increasing to reflect assessed value. It is to be noted that, unlike publicly traded REITs whose shares trade independently of the actual underlying asset values, our LP units reflect directly the "bricks and mortar" investments held by the Limited Partner.

How liquid is my investment?

There is no secondary market for your LP units and there are restrictions on their sale or transfer (see OM) to prevent units from being sold outside of the partnership and to ensure the investments are fully understood.

What are the risks and how are they mitigated?

We use a rigorous and comprehensive combination of complex computer modeling, expert guidance, past experience and good old fashioned physical due diligence to ensure that all possible pitfalls are uncovered and factored into our operational development plan for any asset we purchase. That said however, real estate investment is a speculative venture and is risky in nature. For our Limited Partners, however, exposure to these risks is limited to the amount of capital invested. The General Partner takes on all other risks through the management of the fund/partnership.

1. EXECUTION RISK - Risk of achieving our desired rate of investment returns, discounting poor due diligence, depends heavily on the price paid for the asset. By pooling resources, the Limited Partnership will have the leverage needed to take advantage of low prices on quality assets that enter the market. Also, access to a pool of capital will enable the partnership to find deals in an ever tightening debt environment where the banks are unwilling to fund high leverage speculative investors. Multifamily assets are also viewed as the lowest risk asset class in the real estate family. With a solid pool of money at our disposal, the partnership can afford to step in quickly and invest where others could not fund the deal.
2. OPERATIONAL RISK- There are operational risks associated with this business which can be mitigated through professional management, thorough due diligence, and experience. On the whole, the multifamily asset class is viewed as the least risky of the real estate asset classes. The typical short lease terms in multifamily rentals allow for automatic inflation adjustments to the partnership's income as rents are increased in step with inflation. There is also a very large and predictable tenant pool in most large markets and ample investment liquidity given the large number of buyers searching for high value rental properties. Other commercial real estate becomes less attractive in a slowdown due to longer lease terms which do not easily adjust for inflation as well as much more limited tenant and buyer pools which correspond to increased risk.