Investing in MHP Fund

11 Replies

Hey Team,

My partners and I are kicking off our first mhp fund and I'm curious as to what makes MHP Fund investing attractive to you?

Many different operators offer essentially  similar terms. Can you share what are the deciding factors for you personally? 

Appreciate your insights! 

Katerina

To me, the appeal of any syndication is heavily dependent on the experience, reputation, and skill of the sponsorship team. A fund would be even moreso, since investors give up the ability to review individual deals.

I agree, that the market has pretty much found an equilibrium as to the return projections that sponsors are offering investors. The team is the differentiating factor, because projections are just numbers on a page.

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@Ekaterina Stepanova

Congrats on launching your first fund! As @Taylor L. stated, the sponsor's track record is the first step to evaluate. Once that's done, the markets that sponsors are going into are reviewed next. And then the deals itself. 

If you have one or more MHPs acquired or already under contract, then you should certainly include it in your offering when reaching out to potential investors. 

The main point to keep in mind is: the investors will not join a deal just because they see attractive terms, most will join you on your offering because your team has established and maintains strong relationships with these investors. 

Originally posted by @Ekaterina Stepanova:

Hey Team,

My partners and I are kicking off our first mhp fund and I'm curious as to what makes MHP Fund investing attractive to you?

Many different operators offer essentially  similar terms. Can you share what are the deciding factors for you personally? 

Appreciate your insights! 

Katerina

Do you really, really mean a 'fund'? Where the funds come in and your team decide later how and when to invest? The alternative is you raise funds a deal at a time after you have a deal under contract.

A fund requires a different filing and there are different (higher) costs.

I am not saying you should pick one or the other. Just clarifying what you are asking. 

Originally posted by @Ekaterina Stepanova :

@Taylor L. would it be more beneficial to you, for example, if you knew deals that going into the fund and the fund was small. 

The more you move towards identifying the specific properties before you raise the fund, the less you need to be a fund. You can raise the funds using a different process than what a fund needs to do. Less expensive. And the investors are more likely to take action when they know exactly what they are buying. 

Originally posted by @Ekaterina Stepanova:

@John Corey this makes perfect sense, so I think it will be easier to raise funds since we have identified 70% of funds allocation. Appreciate your input!

Happy to help. Reach out if you have any other questions. In the mean time, good luck on finding deals you can fund.

@Ekaterina Stepanova I look for the experience and expertise of the group. When everyone who has HGTV and a real estate agents license thinks they’re an expert there is just too much white noise you have to block out, everyone is asking for money and promising good returns. I look at the team and see if they’re people I would take seriously.