Keeping ROIs high and taxes low

Marc Dupuis has a firm grasp of real estate investment—so much, in fact, that Simple Acquisitions, the company he founded with his partner Amanda Crowther, creatively brings together accredited investors to allow them to participate in larger deals than they would normally not be able to afford on their own.

Specializing in syndications, Simple Acquisitions assembles the right blend of real estate professionals, whose wealth of knowledge and experience includes finding the right emerging markets, researching and acquiring the right properties, then managing them, increasing their value, and disposing of them at the right time. Dupuis thinks strategically, and by taking on larger projects that throw off larger amounts of cash flow, full-time onsite management becomes possible and safeguards everybody’s investments. It’s what Dupuis refers to as quiet investing.

Simple Acquisitions also relishes economies of scale, because properties with more units are more cost effective. But arguably the biggest benefit of participating in a syndication with knowledgeable promoters comes in the form of doing business with professionals who know the ins and outs of this type of business, who have systems all the while earning investors’ returns passively and tax-free.

“We bring in partners who bring equity,” Dupuis told CREW. “Together we start a new company that gives them an equity stake in that company, and we do all the leg work. We put all the pieces in place and make all the day-to-day decisions to allow for true passive investing. All our decisions are made with the idea of pushing values up.

“We share everything with our partners so that they know what’s going on. There are a lot of companies that don’t do that; they just ask if you want in on a deal and that’s it. We try to make sure people really understand what’s going on because they’re partners. They own an equity share in the underlying property. We don’t make big decisions unless everybody knows what’s going on, and I want them to know that I have their best interests at heart.”

At this year’s Investor Forum, Dupuis and Crowther will give a speech about real estate investment syndication and its many benefits, like tax-free, hands-off investing.

“A lot of people don’t know this, but if you do real estate properly you can shelter the income from taxes,” said Dupuis. “We get cash flow from properties, and with the help of the right professionals you can even lower the taxes that you pay at your regular job.”

Another method Simple Acquisitions uses in its American real estate investments is the ‘1031 exchange,’ named after Section 1031 of the tax code, which helps investors defer capital gains. Dupuis says, unbeknownst to most people, the same system exists in Canada.

“When I was new in real estate, I was young and didn’t know what I was doing,” said Dupuis. “I was buying stuff, fixing it up and flipping it, but then I realized at the end of the year that I was spending a lot on taxes.”

Now, a more seasoned investor, Dupuis has learned some of the tricks of the trade and he’ll share them at the Investor Forum on April 7.

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Neil Sharma

Neil Sharma is the Editor-In-Chief of Canadian Real Estate Wealth and Real Estate Professional. As a journalist, he has covered Canada’s housing market for the Toronto Star, Toronto Sun, National Post, and other publications, specializing in everything from market trends to mortgage and investment advice. He can be reached at neil@crewmedia.ca.