b'What is Equity? Equity in a property is equal to the capital contributions contributed by investors when you first acquire a property. The issuer (your syndicate or fund) will sell off a portion of the ownership to passive investors and retain a portion for the asset management team. Later, on sale of a property, equity is the cash left over after paying all property expenses, including outstanding loan balances, closing costs, and other liabilities (taxes, contractors, utilities bills, etc.), that can be shared among the participants. Note that equity doesnt take into account the purchase price of the value of the asset you are purchasing or developing, as part of the purchase price is usually contributed by a lender, which is a liability on the balance sheet for the property; not an asset. All-cash deals rarely work for commercial properties,aslendersgenerallydemandalesserreturnthanpassive investors. The portion of the purchase price contributed by a lender creates the leverage that a syndicate or fund needs to be able to pay higher returns to investors, and to have enough left over to pay the asset manager for its non-capital contributions.What, Exactly, are Securities? Whentheentityallowsinvestmentsbypassiveinvestorswhoare relyingontheassetmanagertogenerateprofit,theentityisselling securities. What exactly, are securities? Section 2(a)(1) of The Securities Act of 1933 defines the term security as follows: 4'