Global Definitions Database

Access, learn and discover all terms related to the non-listed real estate sector.

Used in

DDQ ESG SDDS SDDS 4.0

Source

Global INREV NCREIF NCREIF PREA

Topic

Vehicle Terms

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A

Asset Management Company

A legal entity that specialises in the tactical management of a vehicle's assets on behalf of the owner of the real estate. Services may include strategic input and production of asset level business plans, appointment of third party service providers at asset level as well as reporting activities at asset level. View full definition

C

Closed End Vehicle

An investment Vehicle with a fixed amount of capital and a finite life. Limited liquidity, with the redemption of units provided for at the end of the life of the Vehicle. View full definition

Club Deal

Informal industry term used to describe an investment Vehicle or structure (often a fund) with generally a limited number of investors investing in a common strategy. Typically investors have more discretion and control than in a typical fund, and have veto rights over major decisions. View full definition

Commingled Fund

A term applied to all open-end and closed end pooled investment vehicles. A Commingled Fund may be organized as a group trust, partnership, corporation, insurance company separate account, or other multiple-ownership entity. View full definition

Commitment period

The commitment period is the period of time as defined in the vehicle documentation during which an investor is obliged to contribute capital upon receiving a drawdown/capital call notice from the Investment Manager / General Partner (GP). View full definition

Constitutional Documents

See definition Vehicle Documentation View full definition

E

End of Investment Period

The end of the period as defined in the Vehicle documentation during which the vehicle can acquire assets. View full definition

End of maximum extendable vehicle term

The maximum vehicle termination date based on either pre-determined extensions at the discretion of the manager or extensions with advisory board or investor vote. View full definition

F

Feeder Vehicle

A separate investment vehicle that enables one or more individuals or entities to pool and invest capital in a specific Master Vehicle(s), without being involved in the portfolio management decisions of the underlying Master Vehicle(s). View full definition

Final closing

As defined in the Vehicle Documentation, the date of the final closing occurs at the end of the equity raising period set by the investment manager when the Vehicle is closed to new commitments. View full definition

Financing Company

Type of SPV engaged in financing real estate assets. There are many different types of financing structures, for example secured and unsecured or internal and external. View full definition

Fund

A Vehicle where capital is pooled together and managed as a single entity with a common investment objective. View full definition

Fund Manager

See definition Investment Manager. View full definition

Funds of funds

A collective real estate investment vehicle that has a strategy of investing in a portfolio of real estate funds. View full definition

G

General Partner (GP)

Sometimes referred to as Managing Member, an entity or person who joins with at least one other entity or person to form a partnership. The general partner, bound by the terms of the partnership agreement, is responsible to act on behalf of business without having to seek agreement from the limited partners for the day to day operational activities and the authority to legally bind the partnership. The general partner may or may not be monetarily invested in the partnership, but generally has unlimited liability for the financial obligations of the partnership. View full definition

H

Holding Company

A holding company's primary purpose is investing in real estate or controlling other companies, assets or entities. For example, holding companies can hold property or ownership interests in loan portfolios, partnerships, and joint ventures. View full definition

I

Inception date

The date on which the vehicle first undertook operating, financing, or investing activity as defined in the Vehicle Documentation. View full definition

Initial Closing

As defined in the vehicle documentation, it is the date on which the conditions for the operating agreement are met for the initial closing. Generally, these conditions relate to subscription commitments. View full definition

Investee

A corporation, partnership or other legal entity or contractual arrangement in which an investor makes a direct investment. View full definition

Investment

A discrete asset or group of assets held for future income, appreciation, or both and tracked separately. View full definition

Investment Advisor

The role referring to activities related to the development and implementation of a strategic portfolio management function for a real estate investment Vehicle. This generally includes research and the development of a strategic plan, the identification and qualification of deal flow, financing and structuring advice and the monitoring of overall Vehicle performance. The Investment advisor can be a separate legal entity with a contractual relationship with an Investment Vehicle, or can be embedded within the activities of a Vehicle Manager. The role of the Investment Advisor is usually documented in an executed agreement between the client/investor and the Investment Advisor. View full definition

Investment Company

A type of investment vehicle which has legal form and framework adapted for specialised investment activities such as but not limited to managing pooled capital from multiple investors in order to buy, sell, or hold investments in various other investment products, funds, or businesses. The investors share in the profits/losses incurred by the investment vehicle. View full definition

Investment Management Company

An entity which manages investment vehicles on behalf of investors. Depending on the scope of activities and legal domicile a management company may need to be authorized and supervised by a regulatory body. View full definition

Investment Manager

The organisation responsible for the overall governance and oversight of the real estate investment fund or other type of investment Vehicles and may incorporate the Investment Advisor. The Investment Manager is ultimately accountable to investors for the overall management of the fund or Vehicle. This can be a formal role as defined by applicable regulation (e.g. the AIFMD), or legally such as the role of the General Partner in a partnership arrangement. Also known as Fund Manager, Vehicle Manager or Investment Advisor. View full definition

Investment Period

The period of time, as defined in the Vehicle Documentation, during the life of the Vehicle when the Vehicle can make investments. View full definition

J

Joint Venture

A Vehicle with at least two parties with a common investment objective. Control over significant investment and risk management decisions is not transferred to an external manager, but is exercised by members in the venture per the Vehicle Documentation. View full definition

L

Life Insurance Separate Account

Funds held by a life insurance company that is maintained separately from the insurer’s general assets. It is generally used for investing pension assets or variable annuity holdings. In the United States, the accounts are regulated by state insurance departments and may or may not be registered with the Securities and Exchange Commission. In Europe, the accounts are regulated by European Insurance and Occupational Pensions Authority (EIOPA) and regulators per country. View full definition

Limited Liability Company

A legal entity which operates within the framework of general corporate legal provisions of a respective domicile. The owner's pooled liability is limited. View full definition

Limited Liability Partnership (LLP)

A partnership established between two or more partners governed by a partnership agreement. The LLP can have different legal forms and varying liability provisions for its partners depending on its jurisdiction. In some jurisdictions LLPs are distinct from Limited Partnerships which may allow all LLP partners to have limited liability, while a Limited Partnership requires the general partner to have unlimited liability. View full definition

Limited Partner

An entity or person who joins with at least one other entity or person to form a partnership. The limited partner generally does not receive dividends but receives distributions from the cash flow generated by the investments, does not have an active role in the operations of the business, and has limited liability with respect to the financial obligations. View full definition

Limited Partnership (LP)

A partnership established between two or more partners governed by a partnership agreement, with at least one general partner and one limited partner. The general partner has responsibility for the day-to-day management of the limited partnership and has unlimited liability for the debts and obligations of the LP whereas the limited partner generally has limited liability. The limited partners have direct rights to a share of the assets and the profits of the LP. View full definition

M

Master Vehicle

A Master Vehicle, also known as Primary Vehicle, is the primary underlying investment vehicle which pools capital from individuals or entities, including Feeder Vehicle, to invest in a portfolio of assets. View full definition

Mortgage Company

A legal entity which conducts business of providing funding to borrowers in order to facilitate additional equity needs in order to acquire residential or commercial real property. The funding is typically collateralized by the real property that is acquired. View full definition

Multi manager

An investment manager who invests capital in a variety of investment strategies. View full definition

O

Open End Vehicle

An investment Vehicle with a variable and unlimited amount of capital which may be accepted and has an infinite life. Investors may purchase or redeem units or shares from the Vehicle as outlined in contractual agreements. View full definition

Outstanding Capital Commitment

Outstanding capital commitment also known as Unfunded Commitment, uncalled capital or remaining capital commitment represents the total unexpired capital commitment less the total capital commitment drawn plus any unexpired Recallable Capital since inception, in accordance with the Vehicle Documentation. View full definition

P

Parallel Vehicle

A separate investment vehicle that enables one or more individuals or entities to pool and invest capital together alongside other investors in another vehicle, or pool of assets, with the ability to control their exposure to the underlying portfolio. View full definition

Partnership

A legal entity or formal arrangement between two or more partners to manage and operate a business, governed by a partnership agreement. The partners have direct rights to a share of the assets and the profits of the partnership. An example of a partnership is a Limited Partnership. View full definition

Planned Liquidation Date

The specific date, as defined in the Vehicle’s Documentation, on which the Vehicle is expected to be liquidated and all residual equity returned to the investors. View full definition

Pooled Trusts

A multi-investor investment Vehicle which is legally structured as a trust. View full definition

Property Company

A legal entity, often referenced as PropCo, formed with the sole purpose of owning real estate assets. This is an example of a SPV. View full definition

Property Management Company

A entity specialised in managing the day-to-day operations of real estate properties for the owners of real estate assets. The entity may be managed directly by the real estate owner or by an asset manager hired by the owner. Services provided can include management, leasing and / or accounting. View full definition

R

Recallable Capital

Also known as recyclable capital, returned capital that can be recalled by the investment manager, in accordance with the Vehicle Documentation. The existence of recallable capital increases investors' remaining capital commitments. View full definition

Redemption limits (cap)

The partial or maximum amount of an investor’s equity that may be returned from the Vehicle over a predefined time period, at the investor’s request, as defined in the Vehicle Documentation. View full definition

Redemption Queuing Mechanism

The order in which outstanding redemption requests/ investor requests to redeem or sell their shares or units in the investment vehicle are prioritised by the Investment Manager in accordance with the Vehicle Documentation. It establishes a queue or waiting list, ensuring a fair and transparent process for honouring redemption requests, particularly in open-end vehicles. View full definition

S

Secondary Trade

A transaction whereby an existing investor transfers units or shares in a Vehicle directly to another investor (either a new investor, or one already invested in the Vehicle), based on pricing and terms agreed between the two parties, without the occurrence of new share/unit issue or redemption by the Vehicle itself. View full definition

Segregated Account

See definition Single Account View full definition

Separate Accounts

A segregated investment account set up by a life insurance company which, through subaccounts, invests in the underlying mutual funds offered through a variable annuity or variable life insurance contract. The Separate Account assets are maintained separately from the insurance company's general account so they cannot be used to pay claims associated with any other business of the insurance company. Separate Accounts are regulated by state insurance departments and may or may not be registered with the Securities and Exchange Commission. View full definition

Single Account

Customized real estate investment accounts funded by one qualified investor. The manager makes investments from the account to meet the strategic and other portfolio management needs of the institutional investor. In certain jurisdictions, it can also be known as separate, segregated or single client account or mandate. The account's investment mandate can be of discretionary or non-discretionary nature. View full definition

Single Client Account

See definition Single Account. View full definition

Special Purpose Vehicle (SPV)

A separate legal entity created for a specific purpose within an investment structure, most often to acquire and/or finance specific assets as a method for isolating financial risk. An example of a SPV is a Property Company or Financing Company. View full definition

Start of Investment Period

The beginning of the period during which the vehicle can acquire assets. View full definition

Strategy-Account Vehicle

A description of the mandate that includes the plan for investment allocations, taking into consideration including but not limited to, goals, risk tolerance, leverage limits, holding period, and the investment style. View full definition

Style

Describes the risk profile of the investment strategy adopted by an investment vehicle - there are three commonly used industry terms: core, value-added and opportunistic. View full definition

Subscription Agreement

A legally binding agreement made by an incoming investor with a Vehicle or its representative fixing the amount of the contributions paid, or to be paid, and the terms and conditions for investing in the Vehicle. View full definition

Subscription queuing mechanism

The order in which outstanding subscription requests/ incoming investment requests from potential investors are prioritised by the Investment Manager in accordance with the Vehicle Documentation. It establishes a waiting list or queue to allocate shares or units in the vehicle when investor demand exceeds the available capacity, ensuring a fair and transparent investment process, particularly in open-end vehicles. View full definition

T

Termination Clause

A clause defined within the Vehicle Documentation that, when exercised, can lead to the termination of the agreement between the members and the Vehicle or the termination of the Vehicle itself. View full definition

Termination Date

The date the Vehicle is scheduled to liquidate, per the Vehicle's Documentation, or if such information is not identified within the legal documents, then the anticipated termination date agreed by investor and Investment Manager. View full definition

U

Unfunded Commitment

See definition of Outstanding Capital Commitment. View full definition

V

Vehicle

The overarching term for any kind of investment structure, including funds, joint ventures, club deals and separate or single accounts. View full definition

Vehicle Documentation

The key documents, including their annexes, establishing a contractual framework of how the Vehicle will operate and the significant legal rights and obligations of the parties entering those agreements related to the Vehicle. For example, these include funds, partnerships, joint ventures or trust agreements. View full definition

Vehicle Formation Date

The date on which the Vehicle was legally established and became available for investors. View full definition

Vehicle Manager

See definition Investment Manager. View full definition

Vehicle Reporting Currency

This is a denomination in which a Vehicleprepares and presents its financial statements and other financial information. View full definition

Vintage Year

A vintage year of an investment vehicle may be determined by using the following two methods: 1. The year when the first committed capital agreement from outside investors is closed and legally binding. 2. The year of the investment vehicle's first drawdown or capital call from its investors. The user should specify which definition is being used and presented for investor reporting purposes. Reference: GIPS View full definition

W

Weighted Average Remaining term of Floating Rate Fund T1 leverage

Generally, the classification of a loan as floating rate debt depends upon what is stipulated in the loan documents without regard to triggers associated with the breach of loan covenants. The measure is calculated as the average remaining term until the maturity date weighted by the outstanding principal balances. The remaining term is defined as the period between the period end and the maturity date measured in years and fractional months. Extension periods that have not been formally exercised should not be included in the remaining term measure. Fund T1 leverage is used for the calculation. View full definition