Fees and Compensation — Form ADV Part 2A (2/23/2024)
[Brochure]
ITEM 5 - FEES AND COMPENSATION
Management Fees
OREA’s compensation is typically a percentage of its fund clients’ equity that it manages. This
management fee is payable quarterly in arrears and is negotiable with each client as stated in the
investment advisory agreement between OREA and the fund clients. With the exception of de
minimus contributions and withdrawals, management fees are prorated for each capital
contribution or withdrawal made during the calendar quarter. The fee assessment typically
ranges from 1.50% to 2.00% and is initially calculated as a percentage of committed capital during
the investment period as that term is defined in the applicable limited partnership agreement
and investment advisory agreement. After the investment period has expired, the management
fee is assessed as a percentage of the invested capital of the fund (less any permanent write-
downs of invested capital). OREA reserves the right to negotiate fees separately with each client.
The management fee may be drawn from the equity contributions of a fund’s limited partner
investors and/or distributable funds as that term is defined in the applicable limited partnership
agreement and investment advisory agreement.
The management fee for its private partnership clients is typically a fixed fee negotiated at the
execution of the advisory agreement and depends upon the scope of work to be provided by the
Advisor.
Incentive Fees
In addition to the quarterly management fee, OREA may be eligible to receive an incentive fee,
generally at the time of dissolution of the partnership, which is based upon the investment
performance of the fund. This performance fee is negotiable with each client and is typically 20%
of the net profits of the fund above a prescribed preferred return. All incentive fees earned by
the Advisor are netted from the distributable funds generated by the fund. Please refer to
governing limited partnership and investment advisory agreements for further details of
incentive fees.
Expenses Reimbursed by the Clients
There are certain recurring expenses associated with the sourcing, management and liquidation
of real estate assets for client portfolios. Limited partner investors reimburse the general
partners of the clients for partnership expenses as that term is defined in the applicable limited
partnership agreement. These expenses may include, but are not limited to: (i) costs and
expenses of operating and owning partnership property; (ii) travel and entertainment expenses
incurred by the Advisor and general partners in connection with a proposed lease, acquisition,
disposition or capital transaction on behalf of the client; (iii) capital expenses and debt service;
(iv) third party due diligence costs, and (v) such other expenses as agreed upon by the general
partners and a majority-in-interest of the limited partners.
Return of Prepaid Fees
If a client has prepaid a fee for future services and its advisory contract with OREA expires during
the period, which has been prepaid, the client would receive a refund of the unused portion of
the fee, calculated on a prorated basis. For example, if a fund client had paid its quarterly
management fee in advance and that fund liquidated during the quarter for which it had paid,
the client would only be responsible for that portion of the period up to the completion of
liquidation, and any fees or expenses not attributable to such period would be returned to the
client or netted out of any incentive fee which may be due to OREA.
Fees for Additional Services
Fees for additional services performed by OREA for other third-party clients or its affiliates are
fully negotiated depending upon the scope of the assignment and are generally paid after
delivery of the service. Fees for OREA's affiliates are fully negotiated with the client and are
memorialized in a contract.
Neither OREA nor any of OREA’s supervised persons accept compensation for the sale of
securities.
Account Minimums and Types of Clients — Form ADV Part 2A (2/23/2024)
[Brochure]
ITEM 7 - TYPES OF CLIENTS
OREA currently provides investment advisory services exclusively to private real estate
investment funds and partnerships that are organized as unregistered limited partnerships
sponsored and launched by its principals and their affiliates. All fund investors are subject to
applicable suitability requirements. For its fund clients, OREA and the general partners require
that each investor in the funds be an accredited investor as defined in Regulation D under the
U.S. Securities Act of 1933, as amended and/or a qualified purchaser as defined in the Investment
Company Act, as amended.