Origin Investments is pleased to announce an increase in the IncomePlus Fund’s dividend for the third consecutive year. This comes despite significant challenges facing the real estate market over the past year—and it underlines the effectiveness of the Fund’s strategy, which is defensively positioned during challenging environments. This is the 58th consecutive month of distributions made by the Fund.
This contributes to a significant 15% increase in the dividend payout over the past three years, aligning with our aim to average an annual dividend increase of 5% or more. For example, a $100,000 investment in March 2019 would be valued at $141,949 today (net of fees) with dividend reinvestment. That equals a $110,087 net asset value and $29,525 worth of cash dividends received during that time.
The Fund’s all-weather strategy is designed to provide defensive positioning during periods of market headwinds. In the past year, these headwinds have included elevated interest rates, rising insurance costs and the threat of increasing oversupply. Added to that was a period of negative rent growth, which we predicted in early 2023 with the use of Multilytics℠, our proprietary suite of machine-learning models. Multilytics forecasts rent growth, one of the most important variables when underwriting a real estate acquisition.
Outperforming During a Challenging Environment
Asset class selection, redemptions and erosion of common equity value also plagued the broader non-traded REIT market in 2023, but Origin’s strategy has proved resilient through significant market corrections. The Fund’s three-year return profile of 39.5% (11.7% annualized) includes COVID-19, record-low interest rates and their subsequent rise to combat increasing inflation, and bank failures. These events have amplified market uncertainty, obscured rent growth predictability—which has complicated acquisition underwriting—and made it more difficult and expensive to borrow capital. The Fund’s agility has allowed it to respond to these challenges.
Today, this strategy includes a significant allocation (61%) to preferred equity investments at cushioned positions in the capital stack, paired with stabilized and development common equity investments providing long-term growth and cash flow. The Fund has not purchased a stabilized asset in three years, primarily due to elevated valuations and a negative leverage environment.
This flexibility means we can tactically reallocate the Fund’s portfolio among preferred equity, common equity and development in search of the highest potential for risk-adjusted returns at any given time in the market. It also highlights the disciplined approach that Origin takes when investing capital—avoiding acquisitions at elevated valuations, which in turn can erode shareholder value. This discipline will continue to guide our approach to Fund management throughout the year and beyond.
About Origin’s IncomePlus Fund
The IncomePlus Fund is designed to deliver a tax-friendly blend of monthly income and long-term capital appreciation to accredited investors by buying, building and lending to Class A multifamily projects in markets in the path of growth.
Please contact your investor relations team member or email investorrelations@origininvestments.com to learn more about investing with Origin.
Disclosure: This information may contain certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance, and actual results or developments may differ materially from those discussed. No investor should assume future performance will be profitable or equal the previous reflected performance. There is no guarantee that investors will or are likely to achieve their objectives or that any investor will or is likely to achieve results comparable to those shown or will avoid incurring substantial losses. Additionally, the performance results displayed herein may have been adversely or favorably impacted by events and economic conditions that will not prevail in the future.
