QUOTE (UTCVenturesLtd @ May 21 2009, 05:06 PM) I know 4 sales people for them. It is starting to feel like one in 25 people i know are involved in selling their product. I looked over their brochure and see that you might end up holding as long as 19yrs and some of their exits were in the 10 to 13yr hold range. They try and target projects with an exit time of 3 to 6yrs. The overall average rate of return is 15.4% based on thier projects that have exited.
A land bank seems to have some attractive features such as no leverage is used, no landlord duties involved, strictly a passive investment, they have international investments, rsp eligible
Disadvantages seem to be the length of time your money is tied up, unknown rate of return til you exit, no interest on your investment unless they are renting out the raw land.
Check out this
forum on Walton
I invested a couple of years ago in Walton International without doing proper DD.
I have not exited yet, but most likely, I will get good profit on the 2 properties I purchased near Edmonton alberta.
But I did purchase a few units in Cactus springs, Az., without reading the prospectus.
In it I found that Walton was selling units to their clients at 7 times what they paid for the land only a few months earlier, and that they got the land appraised by only one appraisal company for 7x their purchase price.
I find that kind of markup very excessive----I should have invested in Walton, and not their overpriced land.
They had a buyer for the land after only one year, and the return would have been approximately 16% after costs, but the purchaser didn`t close and the deal fell through.
with the plummeting of the real estate market in the USA, it will most likely take years to get any return at all for that property.
I was offered a similar deal a few weeks later, also for a property in Az, but the prospectus showed that Walton was selling the land to it`s investors(suckers) at a roughly 5x markup from their also recent purchase price of the land.
don`t forget, in the deal you sign, you take all of the risk, and pay all of the developement costs, and Walton has walked off with 5x to 7x their cost on the land.
I purchased my "investments" from a friend who no longer works for Walton, and it was on the basis of their huge markups on the land that I decided to not buy from them again.