Risk Factors

Investing in our shares involves a high degree of risk. You should purchase our shares only if you can afford a complete loss of your investment.

Some significant risks include the following: 1) Absence of a public market for our shares and a lack of liquidity. 2) Limited operating history or established financing sources. 3) Lack of a diversified portfolio. 4) Ability of our board of trustees to change the methods of implementing our investment policies without shareholder approval. 5) Payment of substantial fees to our advisor and its affiliates. 6) Conflicts of interest facing us and our advisor and its affiliates. 7) Absence of any guarantee that you will receive distributions (distributions have been paid from sources other than cash flow from operations, including proceeds, borrowings or the sale of assets. Payments of distributions from sources other than cash flow from operations reduce the amount of capital available for real estate investments and may decrease or diminish your interest). 8) Absence of any guarantee that we will qualify as a real estate investment trust in any given year. 9) Absence of any guarantee that you will receive distributions (if we do not have enough cash to make distributions, we may borrow, use offering proceeds, issue additional securities or sell assets in order to fund distributions, which will make less funds available for real estate investments, and your overall return may be reduced). 10) Risk associated with the cyclical nature of the homebuilding industry since our activities are limited to this specific sector. We will be affected by changes in industry conditions, as well as by general and local economic conditions. These conditions may occur on a national scale or may affect some of the regions or markets in which we operate more than others.