real estate syndication

As a real estate investor it is critical that you have access to readily available capital in order to capitalize on the numerous opportunities that are present in today’s market. One way to do this is by acquiring properties through syndication. As a real estate investor, especially as a commercial real estate investor, you should constantly be looking for ways to syndicate real
estate opportunities. By successfully syndicating real estate deals, you will be able to acquire more property and profit in numerous ways.

ADVANTAGESCONTACT US

What is it?

Real estate Syndication is when you raise capital from private individuals. It is an effective way for investors to pool their financial resources together to invest in properties much more significant than they could afford on their own. Real estate syndication is when you partner up with another real estate investor and invest in a property that you alone cannot afford. Both sides of the party benefit, and both end up gaining an enormous amount of profit.

Real estate syndication allows you to close on more deals because it will enable you to leverage partnerships and other financial resources. Real estate syndication is a reasonably simple transaction between the Sponsor (Manager) and a group of investors. The basics of real estate syndication aren’t all that different from two guys opening a bar together. As the manager and operator of the deal, the Sponsor invests the sweat equity, including scouting out the property, raising funds and acquiring and managing the investment property’s day-to-day operations, while the investors provide most of the financial capital.

Real estate syndications are structured so that the Sponsor is motivated to ensure the investment performs well for everyone. The more the Sponsor invests in the deal, the more aligned the Sponsor is with Investors.

Real estate syndication

BENEFITS

The biggest reason investors participate in real estate syndication or crowdfunding for real estate is access to deal flow. Not every investor has the time to search and underwrite hundreds of properties to find a gem to acquire. But there are thousands of real estate companies all over the United States who do this for a living.

By getting involved through real estate syndication, investors have access to this deal flow and the ability to invest in real estate without the hassles of property management. Once you start using this pooled investment model, you can get exposure to apartment communities, self-storage deals, mobile home parks, and many other amazing cash flowing opportunities.

benefits

Advantages of investing through a Real Estate Syndicate

superior investment opportunities

There is nothing wrong with single-family homes; they are easier to manage and learn the business with. However, we want to supercharge our investing in building wealth as quickly as possible. If you genuinely want to gain cash flow, starting with multifamily is a great way to go.

larger properties

The syndicator by gathering several equity investors together makes it possible for the investors to buy a larger property than they could on their own..

Entirely passive

 

 Real estate syndicates allow an investor, a limited partner, to be 100% passive in their investment, with no other responsibilities. The syndicator sends monthly updates and quarterly reports along with quarterly distributions that are directly deposited into the limited partner’s bank account.

cost savings

  

 There are economies of scale in investing with others. By pooling funds, a small real estate syndicate can achieve cost savings as compared to an individual investor. A well-funded syndicate can make a substantial down payment on a property and leverage their capital to create improvements and increase returns.

benefits

 

One of the great benefits of investing in syndications is that it allows investors to leverage other operators’ expertise with their capital. This can open up doors to new asset classes, which helps diversify investors’ holdings while delivering high returns.

superior investment opportunities

There is nothing wrong with single-family homes; they are easier to manage and learn the business with. However, we want to supercharge our investing in building wealth as quickly as possible. If you genuinely want to gain cash flow, starting with multifamily is a great way to go.

larger properties

The syndicator by gathering several equity investors together makes it possible for the investors to buy a larger property than they could on their own..

Entirely passive

 

 Real estate syndicates allow an investor, a limited partner, to be 100% passive in their investment, with no other responsibilities. The syndicator sends monthly updates and quarterly reports along with quarterly distributions that are directly deposited into the limited partner’s bank account.

cost savings

  

 There are economies of scale in investing with others. By pooling funds, a small real estate syndicate can achieve cost savings as compared to an individual investor. A well-funded syndicate can make a substantial down payment on a property and leverage their capital to create improvements and increase returns.

benefits

 

One of the great benefits of investing in syndications is that it allows investors to leverage other operators’ expertise with their capital. This can open up doors to new asset classes, which helps diversify investors’ holdings while delivering high returns.

Evaluate Sponsors

While many industries rely heavily on user reviews to provide general feedback about quality, this practice is not prevalent in the financial services sector. So how do you get good information to evaluate a sponsor? Following are some of the points that should be kept in mind by investors when selecting a platform and when evaluating deals.

  • How much relative experience does the sponsor possess?
  • Is the sponsor credible? How do you know?
  • Assess their knowledge and resources
  • Determine if you trust them and if they respect you
  • Look for the story not the score

Focus closely on what skills is needed for the investment to be successful, and how the Sponsor brings those specific elements to the table. Understanding the sponsor’s experience with the type of offering at issue, both qualitative and quantitative, is a good starting point for your due diligence. Evaluating these elements upfront is key to investing successfully. That person or organization will be responsible for making the right decisions with your capital in terms of which investments to acquire, what management decisions to make, and how to treat you as an investor.

What’s important in real estate is to develop an understanding on each transaction of the elements of risk and effort being undertaken by each party, and the level of return under discussion, and to try to come to an arrangement where those things are aligned