Our in-depth review compiles crucial details to help you assess whether Roots is legit, ensuring you make informed investment decisions.

What is Roots and how does it work?

Roots Investment Community Fund is a real estate investment trust (REIT) that focuses on acquiring residential rental properties within the greater Atlanta area. This investment approach leverages Atlanta's appealing market conditions, including its consistent population growth, diverse economic landscape, and the burgeoning influence of the film and television industry, which collectively make it an attractive region for real estate investments.

Operating under Regulation A+, Roots offers investors the opportunity to engage in real estate investment without the need to directly purchase or manage properties. Investors in Roots gain exposure to a portfolio of residential properties, which can potentially provide returns in two main forms: income generated from the rental properties and appreciation in the properties' value over time.

As a REIT, Roots is mandated by law to distribute at least 90% of its taxable income to its shareholders annually, primarily in the form of dividends. This structure not only provides investors with regular income streams but also diversifies their investment across multiple properties, thereby reducing investment risk.

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How risky is Roots?

— Moderate Risk

Investing in the Roots Investment Community Fund, like any investment in real estate or securities, involves several risks. These can include market risk, where the overall real estate market conditions affect property values and rental income. Economic factors, such as changes in interest rates or economic downturns, can also impact the performance of real estate investments.

Additionally, there's the specific risk associated with the properties within the fund's portfolio, such as occupancy rates, property management effectiveness, and the potential for unforeseen expenses related to property maintenance and repair. Investors should be aware that the value of their investment can fluctuate, and there's the potential for loss as well as gain. It's important for investors to consider their risk tolerance and investment objectives carefully before investing in real estate funds like Roots.

How liquid is Roots?

— Minimum Liquidity

The Roots Investment Community Fund allows investors to cash out their investment after the first year. While the fund recommends holding the investment for at least a year to potentially benefit from the expected returns, it acknowledges the possibility of changing circumstances for investors. Therefore, it offers liquidity options on a quarterly basis, providing a balance between the recommended holding period and the need for investor flexibility.

How volatile is Roots?

— Moderate Volatility

The assets within the Roots Investment Community Fund, primarily residential real estate properties in the greater Atlanta area, may exhibit some level of volatility due to various factors. Real estate markets can be sensitive to changes in economic conditions, interest rates, and local market dynamics such as supply and demand imbalances.

However, residential real estate often experiences less volatility compared to stocks and other financial instruments, partly because property values do not fluctuate as rapidly. Additionally, rental income can provide a stabilizing effect on cash flow, which may mitigate some of the asset volatility. Nonetheless, investors should be prepared for the possibility of value fluctuations in their real estate investments over time.

What is the average rate of return for Roots?

16 %
— High Return

Investors in the Roots Investment Community Fund can expect an annualized return of 16%. This figure represents the yearly return on investment, expressed as a percentage, that an investor could potentially earn from their investment in the fund, assuming the performance remains consistent over a 12-month period.

What is the minimum investment amount for Roots?


The minimum investment amount required to participate in the Roots Investment Community Fund is $100.

What is the investment time horizon for Roots?

1 year

The Roots Investment Community Fund recommends investors hold their investment for at least a year to potentially realize the intended returns.

However, recognizing that investors' circumstances can change, the fund offers liquidity options each quarter, allowing investors the flexibility to exit their investment earlier if necessary. This approach balances the long-term nature of real estate investing with the need for investor flexibility.

Who can invest in Roots?

United States

Both non-accredited and accredited investors are eligible to invest in the Roots Investment Community Fund. This inclusivity broadens the opportunity for a diverse range of individuals to participate in real estate investing, regardless of their financial status or investment experience.

Is Roots regulated or audited?

SEC Regulated

The Roots Investment Community Fund operates under regulatory oversight, as evidenced by its offering circular filed with the U.S. Securities and Exchange Commission (SEC). This filing is a requirement for companies that want to raise capital through the sale of securities to the public under Regulation A+. The offering circular provides detailed information about the fund's operations, financial condition, management, and investment strategy, allowing investors to make informed decisions.

Additionally, being subject to SEC regulations means that the fund must adhere to specific reporting and compliance standards, including regular financial audits. These audits are conducted to ensure the accuracy of financial statements and compliance with applicable laws and regulations, providing an additional layer of transparency and security for investors.

Is Roots insured?


The Roots Investment Community Fund, like most real estate investment entities, likely holds various forms of insurance to protect its assets and mitigate risks associated with property ownership and rental operations. While specific details were not provided, common types of insurance for real estate portfolios include property insurance, which covers damage to buildings and personal property caused by events like fire, storm, or vandalism; liability insurance, which protects against claims of property damage or injury occurring on the property; and loss of income insurance, which covers lost rental income due to covered property damage. These insurance policies are essential in safeguarding the investment against unforeseen events and ensuring the continuity of operations and income generation for investors.

Does Roots distribute payouts?


Investors receive distributions at the end of each quarter, which they can choose to either reinvest into the fund or cash out. This flexibility allows investors to either compound their returns by reinvesting their dividends or to extract value in the form of cash, depending on their personal financial goals or needs.

How do I get my money back from Roots?

Investors can get their money back by opting to cash out their investments. This can be done after the first year of investment, with liquidity options available on a quarterly basis. To initiate a withdrawal, investors would typically follow the fund's specified process, which may involve submitting a request through the fund's platform or contacting customer service for assistance. The fund's liquidity provisions are designed to offer investors a balance between the long-term nature of real estate investing and the need for access to their funds due to changing personal circumstances or financial goals.

What are the annual fees for Roots?

For new investors, there is a $5 transaction fee applied to the first investment made into the fund. Any subsequent investments incur a lower transaction fee of $3.

If an investor decides to liquidate their investment before completing one year with the fund, a 6% fee is charged. However, after the one-year mark, investors can liquidate their investments without incurring any fee.

How do I handle my investments in Roots?

Investors in the Roots Investment Community Fund have the ability to manage their investments actively. They can choose to set up recurring investments either on a monthly or quarterly basis, allowing for a systematic investment approach.

Additionally, investors have the option to withdraw their funds, providing flexibility in managing their investment according to their financial goals and needs. This combination of features allows investors to tailor their investment strategy in the fund to suit their preferences for capital contribution and liquidity.

How does Roots get taxed?

The income investors receive from the fund is treated as capital gains. Individual investors have the advantage of deducting up to 20% of the dividend income received on their tax returns. This tax benefit comes with no cap and no restrictions based on wages, offering a tax-efficient way for investors to receive income. This structure is designed to support investors in maximizing their returns by minimizing their tax liabilities.

How many investors are on Roots?

The website received an average of 153,000 visits in the last 3 months.

By the end of 2023, Roots Investment Community Fund attracted 3,000 investors.

Financially, it raised over $14.5 million in capital. This influx of capital facilitated the addition of 58 new properties to its portfolio, expanding its real estate holdings and potential for generating rental income.

The Net Asset Value (NAV) of Roots stood at $26 million, reflecting the current market value of its assets after accounting for liabilities. This figure is crucial for investors as it provides insight into the fund's overall financial health and the value of its property portfolio.

For the last quarter, Roots reported distributions totaling $295,000, showcasing its ability to generate revenue and return a portion of its profits to investors in the form of dividends. This is in line with the REIT requirement to distribute a significant portion of its income to shareholders.

Moreover, the fund maintained an impressive occupancy rate of 97%, indicating strong demand for its rental properties and efficient property management. High occupancy rates are vital for generating consistent rental income and ensuring the stability of the fund's cash flow.

Who is the CEO of Roots?

Daniel Dorfman holds the positions of Co-Founder and CEO at Roots Investment Community Fund. In addition to his leadership role at Roots, he is also a Partner at Roots Real Estate Atlanta, where he has been contributing his expertise since January 2017, marking over 7 years of involvement with the organization. His dual roles underscore his deep commitment and extensive involvement in the real estate market within the Atlanta area, particularly in fostering investments and managing residential properties.

Larry Dorfman is recognized as a Co-Founder and Partner of the Roots Investment Community Fund. His extensive experience in the business world is further highlighted by his role in co-founding and leading the EasyCare team for 36 years. EasyCare is well-known for providing vehicle service contracts and benefits designed to offer peace of mind to car owners, indicating Larry Dorfman's significant experience in building and managing customer-focused businesses. His transition into the real estate investment sphere with Roots Investment Community Fund showcases his versatility and commitment to leveraging his entrepreneurial skills in diverse markets.

Scott Jacobsen serves as a Co-Founder and the Chief Operating Officer of the Roots Investment Community Fund. His professional journey includes nearly a decade of collaboration with Larry Dorfman at EasyCare, where he held the roles of National Program Director and Regional Performance Manager. This tenure at EasyCare allowed him to develop a deep understanding of operations, strategic planning, and performance management, skills that are crucial in his current role overseeing the day-to-day operations and strategic direction of Roots Investment Community Fund. Jacobsen's transition from automotive service contracts to real estate investment underscores his broad operational expertise and adaptability in diverse business environments.

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