MUTUAL FUND TRUST - WHY?

I was reading through the May 2023 issue of Canadian Real Estate Magazine when I read an article that caught my attention.

The topic was about the ability of mutual fund trusts (MFT) to accept registered funds for real estate projects.

Our investors have been asking us for years when we will be able to accept their RRSP, LIRA, or TFSA in our real estate investments.

The roadblock was the cost to set one of these up with quotes ranging from $350,000 to $500,000, and ultimately investors end up paying for these costs. 

More importantly, there must always be a minimum 150 investors in the fund at all times.

If it dips below 150 investors, the MFT loses its status and the unit holders are subject to a 50% penalty tax. 

Yikes! This is like an early lump sum withdrawal from your registered account.

So be an informed investor and ask how many investors are in the mutual fund trust before you invest.

And yes, we set up OCMI MFT to always have the minimum 150 investors.