FS Credit Real Estate Income Trust

A differentiated way to generate income by investing in commercial real estate across the U.S.

An investment delivering stable performance in a volatile market

Since inception, FS Credit Real Estate Income Trust has served as a source of stability in a traditional portfolio by generating a steady level of income with a low level of volatility.

GROWTH OF $100,000 SINCE INCEPTION VERSUS TRADITIONAL ASSET CLASSES

The information displayed in the hypothetical growth section has not been approved for use by the state of Ohio.

Past performance is not indicative of future results. An investment in FS Credit REIT is not a direct investment in real estate and has material differences from a direct investment in real estate, including those related to fees and expenses, liquidity and tax treatment.

Source: Bloomberg. FS Credit REIT is not traded on an exchange. The beginning value of Class I is the NAV per share as of the share class’s inception date on January 5, 2018. The ending value is the transaction price as of August 1, 2020 (which generally equals the prior month’s NAV). The S&P 500 Total Return Index is a widely used barometer of U.S. stock market performance. The key applicable risk of the S&P 500 Total Return Index is the volatility that comes with exposure to the stock market. The S&P 500 Total Return Index is a float-adjusted market cap-weighted index. The S&P 500 Total Return Index is calculated by taking the sum of the adjusted market capitalization of all S&P 500 stocks and then dividing it with an index divisor, which is a proprietary figure developed by Standard & Poor’s. The Bloomberg Barclays U.S. Aggregate Bond Index is weighted according to market capitalization. The Bloomberg Barclays U.S. Aggregate Bond Index is the most commonly used benchmark for determining the relative performance of bond or fixed income portfolios. The Bloomberg Barclays U.S. Aggregate Bond Index is also a major indicator for the overall health of the fixed income investing market. An investment cannot be made directly in an index. The illustration assumes reinvestment of distributions pursuant to FS Credit REIT’s share repurchase program. Indexes are shown for illustrative purposes only. Indexes are meant to illustrate general market performance. Each asset class is suitable for specific investor objectives, which vary greatly.

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Time to reframe real estate allocations

Centering on commercial real estate debt to provide:

  • Income: Invests with a primary objective to generate income
  • Preservation: Focuses on managing volatility and preserving capital
  • Diversification: Complements a traditional portfolio and existing real estate allocation

FS Credit REIT is suitable only for eligible long-term investors because the investment has limited liquidity. Distributions are not guaranteed and may be funded from return of capital or offering proceeds. Carefully review these and other risks at the end of the video. Commercial mortgage loans are illiquid and may not have a secondary market. Consider the key risks before investing. While commercial mortgage loans are typically secured by a first-priority mortgage, they are subject to the risk of default. There is no assurance that commercial real estate investments will provide regular, stable distributions.

Timely opportunity

Here’s why we think now is the right time to invest in commercial real estate debt.

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  • CREATING THE OPPORTUNITY TO GENERATE INCOME

    6.60%

    annualized distribution rate for FS Credit Real Estate Income Trust–Class I 1

  • SIGNIFICANT MARKET OPPORTUNITY

    $4.7T

    U.S. commercial real estate debt outstanding 2

Tax reform

The Tax Cuts and Jobs Act of 2017 introduced a change to the taxation of ordinary REIT dividends.3

  • REITs are generally not taxed at the corporate level to the extent they distribute all of their taxable income as dividends.
  • The tax law provided a 20% deduction on ordinary REIT dividends.
  • As a result, REIT investors receive higher after-tax income compared to the prior tax law.

ILLUSTRATING REIT DISTRIBUTIONS UNDER NEW TAX LAW:

6.0%

Distribution rate

6.7%

Tax-equivalent distribution rate4

Assumes a 37% tax bracket

The information displayed in the tax reform section has not been approved for use by the state of Ohio.

The portfolio

FS Credit Real Estate Income Trust invests primarily in floating rate senior loans secured by commercial real estate properties across the U.S.

Investing in commercial real estate debt may offer a differentiated way to invest in real estate and provide an alternative source of income and diversification at a time when both are hard to find.

FS Credit Real Estate Income Trust seeks to generate an alternative source of income, preserve capital and realize long-term appreciation.

Industry-leading managers

FS Investments has extensive experience designing and managing institutional-quality funds for the broader investing public, and Rialto provides a distinct competitive advantage as a leading real estate investment manager.

Rialto Capital Management is a real estate investment and asset management company with a competitive advantage through its access to information.

Read more about our partnership with Rialto Capital

The properties

FS Credit Real Estate Income Trust invests across property types and geographies in the U.S.

View the property profiles

As of 6/30/2020

Featured properties

Fifth Avenue office building

New York, NY

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Seattle apartment complex

Seattle, WA

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Washington, D.C., suburb office complex

Landover, MD

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