While the basic premise of tenant-in-common investments is thesame regardless of the sponsor — fractional ownership in acommercial real estate asset — individual firms can and dostructure their TIC programs differently. Some firms follow a modelsimilar to that of DBSI, whereby the assets are structured inside amaster lease with a stated monthly distribution by the mastertenant (sponsor) giving the allusion of a guaranteed return.

While the quality and performance of the asset is paramount tothe overall yield to the investor, current events have demonstratedthat if the asset is underperforming to projections, the"guaranteed yield" offered under a master lease is only as strongas the financial stability of the sponsor. Although a promisedhigher yield might be attractive to an investor on the surface,questionable property in a questionable market with questionabletenants translates into a questionable investment when somethinggoes wrong, regardless of a guarantee.

The majority of TIC sponsors, however, do not structure theirprograms this way. Most let each offering stand on its own merits,creating greater transparency through the use of a propertymanagement contract. Notwithstanding the vehicle used to invest inreal estate, when considering the offered yield to the investor,the old adage still holds, "if it looks too good to be true, itgenerally is."