Historical revision — this record as it stood on 23 August 2026, not the current version. View the current record →

Equity transfer model

Each Direct-Hold vehicle is designed so its Investment Units transfer over-the-counter between private parties, with the vehicle's own governing body recording the completed transfer. Only one vehicle is currently established — the Canada limited partnership, Woodfine Professional Centres Limited Partnership — and its units are not currently freely transferable, because the partnership is subject to an active British Columbia Securities Commission cease-trade order. The United States, Spain, and Mexico vehicles described below are planned, not yet established. Once transferability applies, two structural principles govern the design: freely transferable equity within a short, enumerated set of conditions, and peer-to-peer execution — no formal secondary market, no market maker, no corporate buyback facility. The model relies on the fiduciary data mandate for ledger integrity and operates alongside the interest coverage ratio discipline applied at the asset level.

Key takeaways

The Canada vehicle's units are not currently freely transferable because of the active BCSC cease-trade order described above; the design intent below applies once that order lifts, and structurally to the planned vehicles once each is established.
By design, Direct-Hold equity is freely transferable to any eligible counterparty without a general partner approval decision in the ordinary case — distinguishing the model from restricted-equity structures where the issuer holds a right of first refusal or exercises open-ended transfer-approval discretion. In Canada, the General Partner is contractually obligated to admit an eligible transferee, declining only on a short, enumerated list of grounds.
No Direct-Hold vehicle maintains a formal secondary market, matched-order book, or buyback facility; liquidity is determined by the market of willing, eligible buyers, not by corporate policy.
Each transfer is recorded on the asset ledger with a full chain of title, so ownership of a fractional interest is always evidenced by a ledger entry rather than a paper certificate.

Freely transferable equity

Each Direct-Hold vehicle issues Investment Units in its own isolated property ledger. "Freely transferable" means a holder may offer their interest to any eligible counterparty; the vehicle's governing body does not exercise business judgment over who may acquire it. In Canada, the General Partner is contractually obligated to admit any transferee — subject only to two narrow, enumerated grounds: (a) counsel's opinion that the transfer would violate securities or other law, or (b) the General Partner's belief that the transferee's required eligibility representations are untrue. Each unit of equity issued constitutes an investment unit in the named asset.

This distinguishes the model from restricted-equity structures — common in private real estate vehicles — where the issuer retains an open-ended right of first refusal or exercises discretionary transfer-approval power. A transferee does make the same eligibility representations (residency, investor-status, and similar) on each transfer — this is not a business-judgment re-approval, but it is a real, recurring step, not the absence of one.

Over-the-counter execution

Transfer execution is between private parties. No Direct-Hold vehicle maintains a formal secondary market, a matched-order book, or a buyback facility. In Canada, the General Partner records the transfer once the required documentation is delivered — a ministerial recording step, not a discretionary approval, though a narrow, enumerated set of transfers can be declined (see above) or, after the fact, reversed: a holder who causes the partnership adverse tax consequences by becoming a non-resident can be required to divest, at independent-appraiser fair value. An investor seeking liquidity locates an eligible counterparty through their own commercial relationships or through broker-dealer channels that operate independently of the corporate entity.

No subjective liquidity requirements

Traditional fund structures impose redemption gates, liquidity reserves, and lock-up periods subject to fund manager discretion. The Equity Transfer Model contains none of these mechanisms — see Redemption Elimination for the structural rationale. Liquidity terms are determined by the market of willing buyers, not by corporate entity policy. The perpetual equity model applies the same logic over an indefinite holding horizon.

Ledger integrity

The asset ledger records each transfer with a full chain of title. Ownership of a fractional interest is a ledger entry, not a paper certificate. The mathematical integrity of the ledger is maintained by the corporate entity's fiduciary data systems — described further in Fiduciary Data Mandate.

The bottom line

The Equity Transfer Model removes the corporate entity from the liquidity equation without removing it from the record-keeping obligation. Investors can transfer their position to an eligible counterparty at any time; the vehicle's governing body's role is to record that transfer accurately — declining only on the narrow, enumerated grounds described above — not to exercise open-ended approval discretion or to provide a market for it. The absence of redemption gates and liquidity windows is a design feature, not a limitation: it eliminates the structural tension between asset liquidity and investor liquidity that characterizes pooled fund structures. The ledger — maintained under the fiduciary data mandate — provides the authoritative record of every transfer in the chain of title.

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