How to become a Sponsor for large project

9 Replies

How does someone connect with investors to assist them with managing a project as a Sponsor? 

I have experience in residential real estate, commercial real estate and land management. I have a management team in place and have been doing this for 5+ years.

Hi Peter, BP is a great place to do it. Listen to podcasts and read people's posts and reach out to them to see how you can potentially partner with them. Not sure if you are asking about connecting with LPs or GPs. For LPs, attend events where they go (meetups for the most part) or professional events to find GPs (NMHC, IMN, etc).

@Peter Demopoulos you will need to bring significant capital into the deal or find a deal to bring to a sponsor.

Most larger operators use third party managers or already have management in house if they have been in the business for a while.

As @Ellie Perlman pointed out networking and attend events and conferences is a great way to meet sponsors that may need some help on the management side.

Can't imagine a sponsor would need someone to manage their deal, that's kind of their job?

If you are trying to go to LP investors for that then they won't have a deal they need you to manage for them.

I consider myself a fairly smart dude but I think I'm missing something here, could be the 4:00pm bourbon in my hand? ;-)

Originally posted by @Bruce Petersen :

Can't imagine a sponsor would need someone to manage their deal, that's kind of their job?

If you are trying to go to LP investors for that then they won't have a deal they need you to manage for them.

I consider myself a fairly smart dude but I think I'm missing something here, could be the 4:00pm bourbon in my hand? ;-)

I think he means property management as sweat equity which as you know is a non starter unless someone is looking for a partner with that kind of expertise to get started in the game. 

Sponsors and/or LP's will subcontract out management when necessary and in specific niche markets. I already have a project under contract, looking for #2.

In the case of an apartment complex, would the HOA be considered the Sponsor, and the capital financier would be the LP?

Originally posted by @Peter Demopoulos :

Sponsors and/or LP's will subcontract out management when necessary and in specific niche markets. I already have a project under contract, looking for #2.

In the case of an apartment complex, would the HOA be considered the Sponsor, and the capital financier would be the LP?

 The LP may be the counter party, but the GP is making all the decisions. 

An HOA is not a sponsor is any interpretation of the word. I think you should read a bit more on typical structures.

@Peter Demopoulos

As others pointed out, it's a bit unclear as to what type of management you're referring to?! I'm guessing, you're talking about the asset management component. 

In this case,  you don't actually need to talk to LPs. Your main target audience is GPs in a deal. Connecting through conferences as others pointed out is definitely a good way. Another way is through a warm introduction. Think about your existing network of people you've worked with during your X many years of experience - ask them if they know anyone that could be a good fit to connect you with.  Also, ask them for written recommendations. It's a lot better to come into the picture with a proven track record backed up by the recommendations, versus just going cold.  

Depending on what specifically you're looking for, I can make some additional recommendations. Feel free to PM me.

Best!

If you put together a good enough deal for the LPs then present it as it should not matter what your own compensation is, as long as the deal works for them. But better to bat on a track record and everything buttoned up of course.