Course or Info on being a passive investor in syndication deals

Multi-Family and Apartment Investing
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Course or Info on being a passive investor in syndication deals

Preston Gagg
Member since 2017 · 6 posts · 5 votes

Does anyone know of a course that covers this. I've found some podcasts and videos about it but I want a soup-to-nuts course to give me more info fast. Thanks for any replies.

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Brian BurkePro Member
Investor · Santa Rosa, CA · Member since 2012 · 2k+ posts · 7k+ votes
3y

No courses I can recommend, but check out @Jim Pfeifer’s Left Field Investors and this book (full disclosure—I wrote it):  www.BiggerPockets.com/syndicat... 

Podcast Guest on Show The Truth About Real Estate Investing in 2024 (What Investors NEED to Know)
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  • Brian BurkePro Member
    Investor · Santa Rosa, CA · Member since 2012 · 2k+ posts · 7k+ votes
    3y

    No courses I can recommend, but check out @Jim Pfeifer’s Left Field Investors and this book (full disclosure—I wrote it):  www.BiggerPockets.com/syndicat... 

    Podcast Guest on Show The Truth About Real Estate Investing in 2024 (What Investors NEED to Know)
    7Reply
  • J ScottPro Member
    Moderator
    Investor · Sarasota, FL · Member since 2008 · 18k+ posts · 17k+ votes
    3y

    In addition to Brian's great advice (and book!) above, I recorded this a year or two ago:

    https://www.biggerpockets.com/...

    And I'm also a member of LFI as an LP.

    Podcast Guest on Show The Truth About Real Estate Investing in 2024 (What Investors NEED to Know)
    4Reply
  • Jason Thompson
    Wholesaler · usa · Member since 2021 · 222 posts · 67 votes
    3y

    @Preston Gagg @Brian Burke @J Scott Preston, Brian and J Scott are powerhouses regarding Syndications and passive investing. Brian's book has excellent information as he is highly knowledgeable in this field (I've read the book, and it's fantastic). J Scott's podcast is an excellent all-encompassing guide to approaching syndications. These guys are generous with their time and guidance and are great resources. Welcome Preston as a new member of the BiggerPockets Community, perhaps following both of these guys would be a great way to start your account here. All the best, Preston. I wish you nothing but success here and in life. 

    2Reply
  • Preston Gagg
    OP
    Member since 2017 · 6 posts · 5 votes
    3y
    Quote from @Brian Burke:

    No courses I can recommend, but check out @Jim Pfeifer’s Left Field Investors and this book (full disclosure—I wrote it):  www.BiggerPockets.com/syndicat... 

     Wow, after posting my comment I went to the BP bookstore, saw your book downloaded it on Audible and began listening. Great first couple of chapters. Can't believe the author himself is commenting so quickly. Thank you. I may be calling your office soon. And thanks for the comments J & Jason, much appreciated. I'm gonna study for a week or two now and figure out what to do next.

    1Reply
  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    3y

    @Preston Gagg

    Left field investors great group to join.

    My recommendation also is to read a lot of PPM’s from sponsors and start highlighting differences and asking questions.

    Best way to learn.

    7e investments53 Reviews
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  • Brian BurkePro Member
    Investor · Santa Rosa, CA · Member since 2012 · 2k+ posts · 7k+ votes
    3y

    Glad the book is off to a good start for you, @Preston Gagg!

    Podcast Guest on Show The Truth About Real Estate Investing in 2024 (What Investors NEED to Know)
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  • Jonathan G.
    Investor · Marietta, GA · Member since 2015 · 382 posts · 258 votes
    3y

    @Preston Gagg

    @Brian Burke

    @jim pfeifer

    I can vouch for Brian’s book the Hands Off investor. Read it a few years ago and found it extremely useful

    I can also vouch for Left Field Investors. I get a steady stream of investment opportunities just from being on the mailing list.

    I would recommend you start reading as many PPMs as you possibly can to get an understanding of what is offered, what’s common, and what’s reasonable. Then you’ll be better informed and able to quickly identify outliers . There are so many syndication options (multi-family, storage (both existing and construction), mobile home parks, ATMs, car washes)

    6Reply
  • Joseph Crunkilton
    Rental Property Investor · Oregon City, OR · Member since 2020 · 324 posts · 780 votes
    3y

    I believe there's a BP book about syndication. There's also tons of syndicators on here. Try connecting with a few and discussing the process. Just a heads up they require you to be an accredited investor.

    0Reply
  • Ian IppolitoBusiness Member
    Investor · Tampa, FL · Member since 2015 · 1k+ posts · 1k+ votes
    3y
    Quote from @Preston Gagg:

    Does anyone know of a course that covers this. I've found some podcasts and videos about it but I want a soup-to-nuts course to give me more info fast. Thanks for any replies.

    Paul Kaseburg is the author of an eBook on passive real estate investing that I wish I'd read when I started and think should be required reading for every beginner and pro.

    Paul’s sat on both sides of the table on over several *billion* of real estate deals. And his book covers everything a newbie needs to understand: from asset selection, to evaluating sponsors, to capital structures.

    For pros, he challenges conventional wisdom and explodes sacred cows by exposing hidden conflicts of interests and mis-alignments that many in the industry won’t admit to.

    The book is called "Investing in Real Estate Private Equity: An Insider’s Guide to Real Estate Partnerships, Funds, Joint Ventures & Crowdfunding" (written under his pseudonym of Sean Cook).

    The Real Estate Crowdfunding Review
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  • Nathan Murith
    Investor · San Rafael · Member since 2020 · 376 posts · 274 votes
    3y
    Quote from @Preston Gagg:

    Does anyone know of a course that covers this. I've found some podcasts and videos about it but I want a soup-to-nuts course to give me more info fast. Thanks for any replies.


    I am not a syndicator but I really like what Jonathan Twombly does and his Facebook Apartment Investor Club. I think he might have a course as well.

    I know this site https://everyreitool.com/categ... has a ton of syndication resources. Mostly software and apps for syndicators but also books, courses, podcasts and YouTube.

    1Reply
  • Patrick S.
    San Antonio, TX · Member since 2018 · 24 posts · 12 votes
    3y

    I don’t know about courses, but I would have a few recommendations:

    1. talk to people who have invested with the sponsor previously about their experience.

    2. There are a million ways for a sponsor to skim on a deal, so you need someone that you trust to be ethical.

    3. Most successful investors doing syndications have a small group of people that they go back to over and over again.  They aren’t sending out postcards and sponsoring lunches in Holiday Inn ballrooms to get large groups of people to invest.  If the majority of the company activities seem to be about raising money rather than doing actual investments, it’s a red flag.

    4. You can make a proforma say anything you want.  With a few slight adjustments of assumptions on income growth rate, exit cap rate, etc you can make a winner look like a loser, or a loser look like a winner.  No one knows what year 4 insurance cost or utility cost will really be.  The importance is the assumption.  

    So ask questions. like, “What did you assume for utility costs?” If the answer is something like “our other deals average out to $X/sf or $X/door, so I used that number and applied an annual 3% growth” or something like tyat, it’s fine.  It’s less about the number and more about the assumptions.  The more complicated the proforma, the easier it is to distract someone.  Ultimately, you need to be able to understand the deal.  If it’s a house, you can understand, ok, if we’re buying it for $200,000 and we think rents are $1800, and total expenses are about 30% of revenue, that makes sense. (Maybe year 3 taxes will be a little higher or a little lower, but there’s a cushion). And you can look at Zillow and see what other houses and selling and renting for.  

    But with bigger deals, it's easier to lose sight of the actual deal, because the proformas get more complicated, data is less widely available, etc. But don't lose sight of the underlying real estate deal. If revenues are forecast to grow at 3.5% and expenses only grow at 2.5%, by year 10, the NOI will look great, and the sale price based on exiting on a 4% cap will look huge. But don't lose sight of the underlying deal.

    Ask real estate brokers, CPAs, etc about syndicators that they see, and then talk to them.

    1Reply
  • Adrian Fajardo
    Rental Property Investor · Killeen, TX · Member since 2017 · 338 posts · 100 votes
    3y

    @Preston Gagg All great points mentioned above. I use @Brian Burke's book like a textbook. I don't read it once, I actually refer to it over and over! And I'm an active investor (GP).

    Here's the quick and simple truth, if you're truly wanting to be a straight passive investor, getting to know the sponsor to where you can trust him/her with your life is the single best thing you can do. 

    Yes, you can do all the research you want about the market, deal and PPM. That would require a lot of time which I assume you don't have if you're a TRUE passive investor. 

    There isn't a shortcut to anything worthwhile but if you can only do 1 thing, it is the point I mentioned above.

    I hope this helps!

    2Reply
  • Constantine Vasilatos
    Rental Property Investor · Fairlawn, OH · Member since 2018 · 14 posts · 8 votes
    3y

    Hi Preston,

    I am a syndicator. The only way to do this is join a group and partner with people who have already closed at least on syndication

    1. Commercial realtors want to know you can close before they even think about bringing your LOI to the table. You are going to have to create a credibility kit and have some heavy hitters on your team to be awarded your first deal.

    2. You will need an attorney who does syndications. SEC regs are very tricky. 

    3. Banks want previous experience in the multifamily business to qualify. You will need a good commercial broker that understands PPM’s and can package a deal in a way that highlights your management teams strengths. 

    I can go on but I am in a mastermind group even today. Raising money is one of the requirements for this business. Having a story to tell with partners who have experience is key. 

    Michael Blank has a great real estate analyzation tool. Josh Cantwell has a Maverick Mastermind group that I am a part of but it’s not cheep. 

    In a nutshell Syndication is all about partnering with experienced people. A book will just get you frustrated.

    0Reply
  • Preston Gagg
    OP
    Member since 2017 · 6 posts · 5 votes
    3y

    Thanks for all these replies. Constantine was that advice on being a sponsor? I'm looking at being an LP.

    0Reply
  • Account Closed
    Louisville, KY · Member since 2023 · 71 posts · 34 votes
    3y

    I'd see what each has to say on Youtube or another course then purchase whatever. 

    0Reply
  • Constantine Vasilatos
    Rental Property Investor · Fairlawn, OH · Member since 2018 · 14 posts · 8 votes
    3y

    I publish educational content on our website. It explains how to get involved in syndications as a GP or LP. 

    I am a LP on deals as well as a GP on others. We have a group of investors that we offer LP shares when we find hot deals. Our syndications are 506B offerings.

    I welcome your questions. I write articles that take the mystery out of how to invest for long  term generational wealth.

    1Reply
  • Michael Margarella
    Investor · New York City · Member since 2020 · 164 posts · 75 votes
    3y
    Quote from @Preston Gagg:

    Does anyone know of a course that covers this. I've found some podcasts and videos about it but I want a soup-to-nuts course to give me more info fast. Thanks for any replies.

    Hey @Preston Gagg - I wrote a few blogs on this topic and would be happy to discuss. 

    https://www.biggerpockets.com/...

     https://www.biggerpockets.com/...

    1Reply
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