Updated: Feb 26
Possibly the most beneficial reason to consider investing in real estate syndications is that you have the ability to be a passive investor. The sponsor will find the deal, negotiate, underwrite (create a business plan), find financing, close the transaction. Then the investor is letting the sponsor manage the asset or take care of the operational perspective of the investment.
A syndication allows you to take advantage of the experience and financial strength of the sponsor. The sponsor brings a track record and a network of 3rd parties to inspect, finance, provide legal support and manage properties.
Access to Large Investment
A syndication allows the aggregate of capital among other investors to invest in otherwise unobtainable, high-value apartments with high returns. Over 90% of multifamily purchases are made through syndication.
Investment in a syndication typically start at $50,000 and could be as little as $25,000. The relatively modest investment in a particular syndication allows you to access several markets when investing in multiple deals.
Each syndication purchases the multifamily asset through a Limited Liability Company. An LLC provides its members with personal legal protections against lawsuits and personal financial liability. Consult with your attorney for specific advice on the benefits of investing through a syndication.