Should You Invest Your Real Estate Dollars with DLP?
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I often write a blog post about a private real estate deal once it goes “round trip.” I was in the process of doing so recently on an investment that had not done so well when our COO Brett Stevens pointed out a few things to me:
- I seem to feel a lot more obligation to tell white coat investors when an investment did poorly than when it did well,
- There’s a certain amount of liability when saying bad things about an investment partnership, and I better go back and read the partnership agreement to make sure I wasn’t violating it, and
- Am I ever going to write anything about evergreen funds I’m invested in that never go “round trip?”
Basically he was saying, “You’ve been investing with DLP for years and they’ve been advertising with us for years and you’ve never written a blog post about them. But you spent all this ink on a tiny investment you made many years ago that doesn’t even advertise with us.” I sheepishly admitted he was right. DLP has provided two of my favorite real estate investments I’ve ever had, and I basically only mention them in a paragraph on this blog once a year.
Now, to be fair, our real estate sponsors pay us a lot of money. That money gets them plenty of benefits, like an educational/promotional email sent out to our real estate interest list each month, a webinar each year, a listing on our real estate page and any real estate-related content, mentions in the monthly newsletter, and a 10-minute spot on the podcast each year. DLP has also sponsored WCICON for several years. What advertisers don’t get, however, is any sort of sponsored blog post. This isn’t a sponsored post either. But some parts of it might read that way. DLP does pay us. But I am also a happy investor. Here’s the promotional part of this post:
With that out of the way, let’s move on.
The DLP Story
Dream Live Prosper Capital was started by Don Wenner in 2006. It’s now a large company, growing at an average rate of something like 50% each year since then. Hundreds of people work there. DLP manages over $5.5 billion and something like 12,000 rental units. There are over 4,000 investors, about 1/4 of whom are white coat investors like you who have begun investing with DLP since it started advertising with us in early 2021. It’s very mission-focused, and that mission is providing workforce housing. Many of us lament the housing crisis in the country. DLP is actually doing something about it.
The DLP Investments
DLP offers six investments to investors. Here are the details.
Housing Fund
One of the equity investments, the Housing Fund, is an evergreen, leveraged $2 billion+ evergreen equity/preferred equity fund that basically owns apartment communities serving the “workforce.” It was started in January 2020. It targets a 10%-12% return, pays a 6% preferred return, and averages an annualized 17.4% return since inception. It charges an asset management fee of 2% plus 20% of returns above the 6% preferred return, makes monthly distributions, and has annual liquidity. Historically, the income has been covered by depreciation. It is 199A eligible, and it has the ability to make fund-level 1031 exchanges (not investor 1031 exchanges). It sends out a multi-state K-1 reliably in mid-March, and it has a minimum investment of $500,000 ($250,000 for white coat investors).
More information can be found here.
Lending Fund
The oldest of the still-offered DLP funds, the Lending Fund, is an evergreen, leveraged debt fund. Basically, it loans money for 3-36 months to developers at a relatively high interest rate, takes its fees, and pays the rest to the investors. Almost all of its debt is in first lien position, meaning if the borrowers don’t pay, the fund can foreclose on them and own the property. Opened in October 2014, it targets a 9%-10% return, pays an 8% preferred return, and has provided an annualized return of 12.8% since inception. It charges a 2% annual fund management fee plus 20% of returns above 8%, makes monthly distributions, offers 90-day liquidity, and sends out a 1099-DIV for those who own it in a taxable account. It is 199A eligible, and it has a minimum investment of $500,000 ($250,000 for white coat investors).
More information can be found here.
Preferred Credit Fund
The Preferred Credit Fund is an evergreen, minimally leveraged preferred equity/mezzanine debt fund that can also do senior secured loans. As such, it is a riskier fund than the Lending Fund and a less risky fund than the Housing Fund. Accordingly, it targets a 10%-11% return and pays a 9% preferred return, and it has provided an annualized return of 10.91% since inception. Started in October 2021, it charges a 2% annual fee plus 20% of returns above 9%, makes monthly distributions, offers 90-day liquidity, and sends out a 1099-DIV for those who own it in a taxable account. It is 199A eligible, and it has a minimum investment of $200,000 ($100,000 for white coat investors).
More information can be found here.
Building Communities Fund
The Building Communities Fund is an evergreen, leveraged, $180 million+ equity, preferred equity, and debt (mostly equity) fund. It targets a 12%-14% return and pays a 9% preferred return, and it has provided an annualized return of 11.98% since inception. It is mostly doing ground-up development of new communities and, thus, it’s probably the riskiest of the DLP evergreen funds. Also started in October 2021, it charges a 2% annual fee plus 20% of returns above 9%, makes monthly distributions, offers annual liquidity, and sends out a K-1 each March. It is partially 199A eligible, and it has a minimum investment of $200,000 ($100,000 for white coat investors).
More information can be found here.
Living Fully Community Fund
One of the newest funds, the Living Fully Community Fund, is a 6-8 year, leveraged, targeted $150 million equity, preferred equity, and debt (mostly equity) fund. These communities include manufactured housing, build-to-rent, short-term rentals, and RV communities. Started in November 2025, it expects to offer monthly distributions after the third anniversary (although I wouldn’t expect them to be very large initially) and no liquidity until final distribution. Given the risk profile, you won’t be surprised to see it targeting an equity multiple of 2-3X over those 6-8 years (10%-20% IRR) and offering a 10% preferred return. It charges a 2% annual fee plus 20% of the returns above 10%. It will be partially 199A eligible and will send out a K-1 each March. In 2025, it had enough depreciation to cover over 92% of the investments made. It has a minimum investment of $100,000.
More information can be found here.
Lending Fund Series A Note Offering
The Series A Note Offering is a $20 million debt investment with a rate of return fixed at 8%. It is basically used the same way as the Lending Fund, but it actually sits senior to the Lending Fund “equity holders.” That’s why it offers a slightly lower return. It has a five-year term, but it functionally still offers 90-day liquidity with an optional call right. It offers monthly distributions and a 1099 tax treatment, and it requires a minimum investment amount of $200,000. It is not 199A eligible.
More information here:
- How to Start Investing in Real Estate
- I Want to Invest in Real Estate, But I Also Want to Be Totally Lazy About It: What Are My Options?
Our History Investing with DLP
Katie and I have had money invested with DLP since March 2019—first indirectly in the Lending Fund, then directly in the Lending Fund starting in January 2021. We have invested in the Housing Fund since June 2021. Although both funds offer monthly distributions, we have reinvested all of our distributions in both funds. We invest in the Housing Fund in a taxable (trust) account and in the Lending Fund via the WCI 401(k). Altogether, it’s a high six-figure amount, and we expect to invest more this year that will push that to a seven-figure amount. We calculate our Housing Fund returns slightly differently than DLP (it values the assets in the new year and then applies that value to the end of the prior year when changing the Net Asset Value [NAV] each March). Our returns have been as follows:
Housing Fund
- 2021: 6.69% (partial year)
- 2022: 18.93%
- 2023: 12.57%
- 2024: 9.97%
- 2025: 9.48%
Our annualized return in the investment is 11.98%. Basically, we’ve gotten the targeted return as expected and have not experienced a negative year. In comparison to another real estate investment we own, the Vanguard Real Estate Index Fund (VNQ), the DLP returns have been higher and more consistent in the years since we’ve been invested in the DLP fund. Here are the comparison returns:
- 2021: 42.49%
- 2022: -23.31%
- 2023: 10.74%
- 2024: 5.02%
- 2025: 3.13%
It’s a little tricky for us to see annualized returns for the exact same dates for this fund since we didn’t start investing in the DLP fund until mid-year 2021, but our annualized returns for the full years of 2021-2025 were 0.43%, dramatically lower. As of July 29, 2026, VNQ’s annualized five-year return is 2.79%. Either way, it’s much lower than the 12% the Housing Fund provided for us. Plus we got to avoid that nasty 2022 experience.
Lending Fund
While not super tax-efficient, debt real estate (a type of private credit) is one of my favorite asset classes. I love the consistent, high returns. Sure, you’re not going to get 17%, much less 25%, out of this asset class, but for volatility that is often even lower than bonds, I think the return is fantastic. We’ve had an annualized 9.57% return in this asset class over the years, and the Lending Fund has been a big part of that. Our returns have been . . .
- 2021: 4.60% (partial year)
- 2022: 11.74%
- 2023: 11.31%
- 2024: 10.55%
- 2025: 10.61%
. . . for an annualized return of 10.08%. It’s pretty hard to complain about an investment that seems to reliably give you a 10% return every year. There are obviously no guarantees, and even DLP says it’s only targeting 9%-10% per year. But you can see why we’re pleased with the performance, especially given what has been happening in public real estate during the years we’ve been investing in the fund. Perhaps a reasonable comparison can be made to the iShares Mortgage Real Estate ETF (REM). Morningstar reports the following returns for that fund:
- 2021: 16.37%
- 2022: -27.44%
- 2023: 14.55%
- 2024: -0.87%
- 2025: 13.37%
The annualized five-year return from March 2021 to March 2025 is reported as -2.14%. The DLP fund outperformed that by 12%, and again, we didn’t have to go through that nasty 2022 experience. Hard to complain about that. Now you know why 1/4 of DLP investors are WCIers.
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What Do I NOT Like About Investing with DLP?
I told you this wasn’t a sponsored post, and I meant it. I don’t have much negative to say, especially when I compare these investments to my other private, passive real estate investments. I run into people who don’t like real estate investing at all, figuring they get enough real estate out of a total stock market fund. That’s fine; real estate is optional, even if I think it’s the first “alternative” asset class that should be included in your portfolio.
I also run into people who don’t like private real estate. That’s fine, too, but you can see what we would have received if we’d only been invested in VNQ and REM. And, of course, there are plenty of direct real estate investors who note the advantages they get by investing directly. That’s fine also, but we’re a little busy practicing medicine (Jim), serving on a school board (Katie), raising kids, and running WCI. Back in 2011, I said if WCI didn’t take off within two years, I’d build a direct real estate empire. Well, WCI took off, so here I am blogging instead.
Some people might not like that DLP probably isn’t going to give you a 17% or 25% return, like some other real estate investments. That’s fine; I don’t need to shoot the lights out to reach my goals. Frankly, many real estate investors take on way too much risk, especially brand new ones, as I’ve written about before. I’d much rather make a consistent 12% and sleep well at night than get 20%+ sometimes and sweat out the 2008s and 2022s of the future. Besides, DLP has had some fantastic years. I think the Housing Fund reported a 45.6% return for 2021. We missed most of it, unfortunately, but many real estate investments crushed it that year. Even VNQ made 40.5% in 2021, most of it early in the year like the Housing Fund. Be sure to remember that just because a syndicator projects a 22% return on their latest and greatest project doesn’t mean you’re going to get it. I’d rather see underpromising and overdelivering when it comes to my real estate returns.
DLP raised its fees a few years ago, basically doubling them from 1% to 2% for the lowest balance investors. I wasn’t thrilled about that (fees have to come out of your return after all), but I also recognize a private real estate fund management fee isn’t exactly the same thing as an index fund expense ratio. The private fund is doing a whole lot more than just buying stocks on the open market.
But there is a way around that increase. It’s called being rich. Larger investments pay lower fees:
- <$1 million = 2%
- $1 million-$10 million = 1.5%
- $10 million-$25 million = 1%
- $25 million+ = 0.75%
But if you’ve got 30% of your portfolio in real estate and DLP is only one of your three operators, you’d still need to be a decamillionaire to get a 0.5% discount on your annual fees.
Some people like more transparency into the underlying investments themselves. DLP doesn’t put out quite as much property-specific detail as some of my other private real estate investments, but it’s enough for my taste. I’m really only interested in reading the periodic reports when things aren’t going well, and that hasn’t happened so far for me at DLP.
In early 2026, DLP was not taking retirement account money into the Housing Fund and Lending Fund. This was a compliance issue. Basically, if 25% or more of a fund consists of retirement funds, the entire fund must be treated like a retirement fund, which introduces additional costs and hassle. DLP’s plan was to start accepting additional retirement account money once the ratio of retirement to taxable money decreased again. At the time this was written, the Housing Fund was taking retirement account money again, but the Lending Fund still couldn’t.
The minimum investments for the Housing and Lending Fund were increased from $100,000 to $250,000 for white coat investors (although those are still half the amount non-WCIers must have.) This is also a compliance issue. Due to the regulations for these funds, the number of investors in the funds is limited to 2,000 per fund, and both of these funds are rapidly approaching that number. DLP is just trying to get as much bang for its buck capital-wise as possible out of the remaining slots available.
Like any diversified private passive real estate equity fund, investing in a fund like the DLP Housing Fund may eventually require you to file multi-state tax returns. While there were numerous contributing factors, the main reason I stopped doing my own personal tax returns was that I just couldn’t figure out which states I had to file in and which ones I didn’t. There is an additional cost and some hassle associated with this.
More information here:
- 5 Bad Arguments Against Private Real Estate Syndications
- A Tale of 2 Sponsors: How My Real Estate Investments Have Had Vastly Different Results
What DO I Like About Investing with DLP?
The main reason I invest in real estate is to get high returns and low correlation with stocks and bonds. I get that out of DLP. At least for the last few years, the returns have been much better than what was available in publicly traded markets, and with lower correlation to my stocks and bonds. However, I really appreciate the evergreen nature of my DLP funds. While a closed-end fund has some benefits, an evergreen fund allows us to:
- Have more liquidity (although we haven’t needed that)
- Reinvest all our distributions
- Not have to realize unwanted capital gains
- Purchase additional shares of the same fund with new investment money—just like a mutual fund—and still only get one K-1 each year
- Not have to do additional due diligence on a new fund or operator
We appreciate DLP’s focus on taxes as well. Almost all of the income we’ve ever received from the Housing Fund has been covered by depreciation. The K-1s always come out in mid-March, and DLP has worked with me so I could hold the less tax-efficient Lending Fund in the WCI 401(k). And since the Housing Fund is evergreen and the properties are held long-term, I don’t have to realize capital gains there until I choose.
I appreciate the DLP focus on mission. Solving the workforce housing crisis is an important mission, but perhaps even more significant, people who work for a company with a strong mission experience more happiness, do better work, and achieve better returns. DLP mostly keeps things pretty simple. The two funds I invest in basically do one thing and do it well. I appreciate that reliability as well as the top-notch communication from the company.
Over the eight years since we started investing with DLP, I’ve come to appreciate founder Don Wenner. Integrity and trust are important in a long-term relationship. Business really isn’t that complicated. You just say what you’re going to do, and then you do what you said you were going to do. Don does that. After investing and partnering with DLP as a real estate advertiser for years, we’re now working together in a new business that is even more important to me, White Coat Planning. There are no guarantees in life, and WCI (the media company) doesn’t ever officially “recommend” investments (gotta have a license for that). But Katie and I are certainly happy with these ones.
DLP puts on plenty of fun events and conferences as well. I’m not really a “conference person” (despite the fact that WCI puts one on every year), but I know lots of people are, and the conferences are good. I appreciate the focus on not letting our wealth ruin our kids and learning to be better givers.
Who Should Invest with DLP?
Accredited investors who have enough money to hit the minimum investments while still maintaining a diversified portfolio and who desire a private, passive real estate investment in their portfolio should consider investing with DLP.
More information here:
- Truth, Lies, and Hype: Sorting Through the Messaging Around Real Estate Investing
- Diversification Always Matters (My Syndicated Investment Goes to Zero)
In Which Fund Should You Invest?
Once people have decided that they want a private, passive real estate investment and that they like DLP, their next question is usually in which fund they should invest. While fund minimums will dictate this answer for many people (Housing and Lending funds are $250,000, but you can get into most of the other funds with $100,000), I think you’re better off assessing the underlying investments, particularly when it comes to risk. Consider a list of the DLP investments in order from least risky to most risky, along with their targeted returns, and that will give you a sense of how much risk you will be taking.
- Series A Notes (8%)
- Lending Fund (9%-10%)
- Preferred Credit Fund (10%-11%)
- Housing Fund (10%-12%)
- Building Communities Fund (12%-14%)
- Living Fully Community Fund (Equity Multiple of 2-3X over 6-8 years, i.e. 9%-20%)
The higher the targeted return, the harder it is to achieve and the higher your risk of loss.
If liquidity is a serious consideration, consider the Lending Fund and Preferred Credit Fund, and definitely not the Living Fully Community Fund.
If tax benefits are a key reason for your investment, focus on the Housing Fund or the Living Fully Community Fund. The debt funds might get the 199A deduction, but that pales in comparison to having depreciation provide you with tax-free income.
Do you have more questions about DLP or private real estate in general? Post them in the comments below!
The post Should You Invest Your Real Estate Dollars with DLP? appeared first on The White Coat Investor – Investing & Personal Finance for Doctors.
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