Black-owned investment company RD Lee Capital Partners has created a new initiative that gives nontraditional investors a shot at obtaining generational wealth in the hotel sector.
The company launched the RDL Hotel Fund I on Vesterr, ultimately giving people who are not accredited investors a chance they would not have otherwise.
“Once I became an accredited investor, a lot of investment opportunities came my way,” Founder and Managing Partner Ramel Lee tells BLACK ENTERPRISE.
“I started getting opportunities to invest in liquor barrels, Broadway shows, and big real estate projects.”
An accredited investor is a person or entity that meets the stringent financial criteria set by the Securities and Exchange Commission (SEC).
According to SEC guidelines, individuals must earn at least $200,000 in the last two years to become accredited. Couples need a combined income of at least $300,000 in the previous two years.
Additionally, individuals must have a net worth of over $1 million. Accreditation has advantages. It allows companies raising capital to determine who is in their pool of potential investors. For investors, it determines whether they can invest in early-stage companies.RD Lee Capital Partners Aims To Close The Wealth Gap
When you scratch the surface, one thing is clear for significant investment projects: you have to earn a certain amount of money for the opportunity to make more. Lee, who comes from a civil service background, doesn’t think this is fair.
“People in my background are making good money and had enough to invest [but] they still weren’t given the opportunity to get ahead,” he says.
After careful research, he found a way to open the door for people who want to invest but do not meet the SEC’s accredited requirements through its crowdfunding regulation.
In 2024, RD Lee Capital Partners finalized a deal to be a part of the ownership group that owns the Staybridge Suites in Indianapolis and the Hampton Inn & Suites in Scottsburg, Indiana. The RDL Hotel Fund I initiative allows investors to capitalize on the rapidly growing U.S. hotel market. The fund focuses on the economy and extended-stay hotel sectors, which have demonstrated remarkable resilience through economic cycles, according to Lee.What It Takes To Invest in RDL Hotel Fund I
Lee says RD Lee Capital Partners lowered the bar for people to invest. The minimum is $10,000 to get into the fund. For perspective, Lee says these funds would cost accredited investors anywhere between $25,000 and $50,000 minimum.
For nonaccredited investors, there are still SEC requirements to abide by. One in particular is that the investment can’t exceed 10% of your income. While most companies shy away from the crowdfunding regulation, Lee says opening up opportunities in the hotel sector is important to him.
“African Americans own less than 2% of all hotels in the U.S.,” he says. “While we’re big consumers, we have very little ownership into the asset class. That’s something I want to work on changing,”
He adds, “African Americans spend over $2 trillion consumer dollars. We have to start shifting our mindset from a consumer mindset to an investor mindset. That same $2 trillion can be used to invest and completely close the wealth gap, but we need these opportunities for all of us to be able to invest in.”
Information on RDL Hotel Fund I can be found on Vesterr. Lee tells Black Enterprise that he plans to take a hands-on approach with investors by taking them on an investment and operational journey.
“We host webinars with the investors to discuss our thought process on acquiring assets [and] what we’re doing to add value to the assets,” says Lee.
“We bring them on not just the financial journey but also the operational journey. They’ll learn enough that if they decide to sponsor a deal on their own, they’ve been through the process already, and they’ll be able to do exactly what I’m doing.”
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