How to find offmarket syndication opportunities with great GPs/operators?
Most Popular Reply
Arn CenedellaPro Member
Rental Property Investor 路 Greenville, SC 路 Member since 2008 路 786 posts 路 1k+ votesI鈥檓 a multifamily syndicator and could toot by own horn but won鈥檛. 馃榾
Check into Left Field Investors.
This is a great group of LPs who share their experiences with GPS across the country. The cost to join is nominal but well worth it.
You might also check out the Best Conference in Salt Lake City starts April 10.
LFI has a one day full day LP presentation the day before the Conference on Tuesday April 9.
This would be a great place to start your search.
Good luck.
One word of advice is you come across a deal where the GP is promoting 8% cash on cash 20% IRR, I'd be very skeptical given the current debt market.
74 Replies
- 2yArn CenedellaPro MemberRental Property Investor 路 Greenville, SC 路 Member since 2008 路 786 posts 路 1k+ votes
I鈥檓 a multifamily syndicator and could toot by own horn but won鈥檛. 馃榾
Check into Left Field Investors.
This is a great group of LPs who share their experiences with GPS across the country. The cost to join is nominal but well worth it.
You might also check out the Best Conference in Salt Lake City starts April 10.
LFI has a one day full day LP presentation the day before the Conference on Tuesday April 9.
This would be a great place to start your search.
Good luck.
One word of advice is you come across a deal where the GP is promoting 8% cash on cash 20% IRR, I'd be very skeptical given the current debt market.
- Investor 路 VA 路 Member since 2015 路 21k+ posts 路 19k+ votes2y
Quote from @Forest Wu:
Hi BP family, would anyone have recommendations on the best way to find offmarket syndication opportunities with GPs/operators that have great track records? I'm avoiding deals provided through platforms like FundRise, RealtyMogul, CrowdStreet, etc since often times those deals are the worst in terms of performance.
Put differently, I'm assuming some of the best GPs/Operators don't bother marketing and already have a reliable group of investors to turn to. Any idea how to be a part of those specific groups?
Every person who will reply to this post is most likely a syndicator or fund manager (well 2/2 so far).
You can search here on BP, there are groups like Left Field Investors as well.
Contrary to popular belief, yes good operators do market and spend money on marketing because there is so many bad offerings out there they still need to be noticed.
As Arn mentioned about what people offer, first rule of investing is do not even look at the projected returns first. That is the worst place to start. Look at the deal, the leverage, the risk and everything about the deal, then think "what is the risk of this going good or going bad, and what should I be paid for that risk". Where am I in the capital stack. I love all the debt funds where investors are saying "first position secured liens" - well yes that is what THEY invest in, but read the fine print that states "your investment is unsecured and not tied to any of the liens".... Add that they have bank financing as well and you are an unsecured creditor behind a lender.... Review all of this and then see if it matches your appetite.
For example I have seen someone offering 40% annual returns. I look at what they do which is unsecured short term financing to companies out of money - so that could easily be 40% or 0%. Roulette is 50% so I feel like that is not worth it. On the other end I have seen deals that have no leverage, are boring but can get you 7-10%. Are you ok with that? Or would you rather take on more risk to get 12-15%. On a $50,000 investment is the extra $1000-$2500 worth that risk?
As Arn said, I would
7e investments53 Reviews - Cincinnati, OH 路 Member since 2020 路 4k+ posts 路 3k+ votes2y
@Forest Wu, I will make this 3 for 3 in terms of people that work in the syndication space responding. I will note, personally, I am a passive investor, as well.
I would generally agree with your assessment. There are A LOT of syndicators out there. And many do not have any marketing department of budget. It is purely friends and family. I would not purely assume that because someone is out there marketing they are a bad operator. They may be an emerging manager that is a great operator, but simply haven't been around very long, or it could be a very experienced manager with more acquisitions connections (and presumably good deal flow) than investor contacts, so needs to market to build that network to capitalize on the good deals they are finding.
That being said, these "off market syndicators", as you call them, are like "off market houses". They are harder to find. It often comes down to how you know. I am on some email lists through former coworkers that have spun off to start their own funds. I have done Edgar searches for Form Ds that list Real Estate in their filing. I have driven past properties that sort of fit my general investment box, then google "who owns XYZ" and the market name. Normally you can find a press release. I read industry magazines like Multifamily Executive, The Real Deal, etc and see who is buying, then google that company.
Again, I don't want to imply this is a steadfast rule, but often times, when I find groups that have long track records, consistently good returns through multiple economic cycles (definitely experience through Financial Crisis, and ideally dating back to 90's), I will get on calls with their team to find out that they are QP only offerings, and/or have $150k+ minimums. Again, not always, but in my experiences, this has been pretty typical.
All that being said, it takes time, and isn't guaranteed to get you anything better than you can get from the groups that start showing up as sponsored listings on google, paid FB and IG ads, etc. At the end of the day, you need to do your own due diligence.
And like Chris notes, if you start getting added to a dozen syndicator lists, all of whom are buying large-scale, Class B, Value-Add Multifamily deals in the suburbs of major metros, and 2-3 are projecting 30% returns, 2-3 projecting 20% return, and the remainder are in the mid-teens, I would really dig hard as to what is going into those 20-30% projections. Chances are they are actually lower end properties in higher crime areas, heavier value-add, higher leverage, aggressive assumptions, etc. Because all else being equal, if you are assessing two very similar deals in similar markets from similarly capable operators, the returns will be pretty similar at the end of the day.
- Member since 2023 路 6 posts 路 7 votes2y
Other groups to join (if you are an investor and not a GP) are 506 Investor Group and Private Investor Club. Both of those and have good deals and due diligence from LPs (not GPs) and both are free but you have to go through a process to be accepted to avoid GP infiltrators. All three of these groups sometimes get special deals on certain syndications (lower fees and better promote). 506IG does not allow GPs. Private Investor Club is mostly restricted to LPs as well. I like this because it allows more honest discussions without people trying to push something.
I have been studying this space over the last few months and a lot of GPs rely on the ignorance of investors (about their failures, inexperience, unrealistic underwriting assumptions or their unreasonable fees) to take more people's money.
- Lender 路 Baltimore, MD 路 Member since 2019 路 37 posts 路 34 votes2y
I would be careful at this stage of the cycle touching anything that's syndicated. Some great advice here to do your own underwriting and focus on the experience of management. Another option is to consider is Blackstone's BREIT though that went through a sketchy period with redemption requests.
https://www.breit.com/ Quote from @Amir Batouli:
Other groups to join (if you are an investor and not a GP) are 506 Investor Group and Private Investor Club. Both of those and have good deals and due diligence from LPs (not GPs) and both are free but you have to go through a process to be accepted to avoid GP infiltrators. All three of these groups sometimes get special deals on certain syndications (lower fees and better promote). 506IG does not allow GPs. Private Investor Club is mostly restricted to LPs as well. I like this because it allows more honest discussions without people trying to push something.
I have been studying this space over the last few months and a lot of GPs rely on the ignorance of investors (about their failures, inexperience, unrealistic underwriting assumptions or their unreasonable fees) to take more people's money.
Thanks for the response Amir! I'll definitely check out those groups. I definitely prefer to evaluate things (e.g., pressure test assumptions, look at GPs past performance vs their projections, etc.) before I make a contribution so this definitely feels like a good group to be a part of.
Some GPs who have seemed reputable are still putting in assumptions such as 5% annual rent increases (which is insane in my mind) to get to their exit figures. So definitely remain vigilant!
Have you invested in deals with 506 Investor Group or Private Investor Club before?
Quote from @Daniel Sperling:
I would be careful at this stage of the cycle touching anything that's syndicated. Some great advice here to do your own underwriting and focus on the experience of management. Another option is to consider is Blackstone's BREIT though that went through a sketchy period with redemption requests.
https://www.breit.com/Thanks so much for the advice, Daniel! Yeah, I definitely prefer to dig into the weeds before investing and usually request the pro forma if it's available. Right now, it's a pretty scary period for multifamily. But given the high-interest rate and expanded cap rate environment, I feel like there may be some good opportunities for vulture GPs/Operators. Now I just need to find the right ones....
Quote from @Evan Polaski:
@Forest Wu, I will make this 3 for 3 in terms of people that work in the syndication space responding. I will note, personally, I am a passive investor, as well.
I would generally agree with your assessment. There are A LOT of syndicators out there. And many do not have any marketing department of budget. It is purely friends and family. I would not purely assume that because someone is out there marketing they are a bad operator. They may be an emerging manager that is a great operator, but simply haven't been around very long, or it could be a very experienced manager with more acquisitions connections (and presumably good deal flow) than investor contacts, so needs to market to build that network to capitalize on the good deals they are finding.
That being said, these "off market syndicators", as you call them, are like "off market houses". They are harder to find. It often comes down to how you know. I am on some email lists through former coworkers that have spun off to start their own funds. I have done Edgar searches for Form Ds that list Real Estate in their filing. I have driven past properties that sort of fit my general investment box, then google "who owns XYZ" and the market name. Normally you can find a press release. I read industry magazines like Multifamily Executive, The Real Deal, etc and see who is buying, then google that company.
Again, I don't want to imply this is a steadfast rule, but often times, when I find groups that have long track records, consistently good returns through multiple economic cycles (definitely experience through Financial Crisis, and ideally dating back to 90's), I will get on calls with their team to find out that they are QP only offerings, and/or have $150k+ minimums. Again, not always, but in my experiences, this has been pretty typical.
All that being said, it takes time, and isn't guaranteed to get you anything better than you can get from the groups that start showing up as sponsored listings on google, paid FB and IG ads, etc. At the end of the day, you need to do your own due diligence.
And like Chris notes, if you start getting added to a dozen syndicator lists, all of whom are buying large-scale, Class B, Value-Add Multifamily deals in the suburbs of major metros, and 2-3 are projecting 30% returns, 2-3 projecting 20% return, and the remainder are in the mid-teens, I would really dig hard as to what is going into those 20-30% projections. Chances are they are actually lower end properties in higher crime areas, heavier value-add, higher leverage, aggressive assumptions, etc. Because all else being equal, if you are assessing two very similar deals in similar markets from similarly capable operators, the returns will be pretty similar at the end of the day.
Excellent advice, Evan! Thanks so much for sharing. And you're right - marketing doesn't necessarily mean that they're a bad operator. My only worry is that by the time an opportunity is listed on a platform such as Fundrise/RealtyMogul, it often means that: 1/ they're not that experienced 2/ have challenges raising capital 3/ hoping to take advantage of naive investors.
I like your analogy of "off market syndicators" like "off market houses". It definitely feels more like a 'who you know' type of game. I'll definitely start keeping up with the magazines that you recommended - that seems like a good place to start!
That makes sense - these successful GPs/Operators are often only looking for institutional investors / QPs because they don't want the hassle of smaller checks.
I've probably looked at dozens of deals so far and came close to investing in one that required a larger check. However, I wasn't thrilled with some of the assumptions they were making for new construction apartments in the current economic climate. In the meantime, I'm going to keep searching. If I find anything interesting, I'll let you know if you're interested. If you could do the same, that'd be great!
Would you consider it a red flag if some GPs don't share their pro forma? I was surprised by some the resistance I faced when I asked to see them.
Quote from @Chris Seveney:
Quote from @Forest Wu:
Hi BP family, would anyone have recommendations on the best way to find offmarket syndication opportunities with GPs/operators that have great track records? I'm avoiding deals provided through platforms like FundRise, RealtyMogul, CrowdStreet, etc since often times those deals are the worst in terms of performance.
Put differently, I'm assuming some of the best GPs/Operators don't bother marketing and already have a reliable group of investors to turn to. Any idea how to be a part of those specific groups?
Every person who will reply to this post is most likely a syndicator or fund manager (well 2/2 so far).
You can search here on BP, there are groups like Left Field Investors as well.
Contrary to popular belief, yes good operators do market and spend money on marketing because there is so many bad offerings out there they still need to be noticed.
As Arn mentioned about what people offer, first rule of investing is do not even look at the projected returns first. That is the worst place to start. Look at the deal, the leverage, the risk and everything about the deal, then think "what is the risk of this going good or going bad, and what should I be paid for that risk". Where am I in the capital stack. I love all the debt funds where investors are saying "first position secured liens" - well yes that is what THEY invest in, but read the fine print that states "your investment is unsecured and not tied to any of the liens".... Add that they have bank financing as well and you are an unsecured creditor behind a lender.... Review all of this and then see if it matches your appetite.
For example I have seen someone offering 40% annual returns. I look at what they do which is unsecured short term financing to companies out of money - so that could easily be 40% or 0%. Roulette is 50% so I feel like that is not worth it. On the other end I have seen deals that have no leverage, are boring but can get you 7-10%. Are you ok with that? Or would you rather take on more risk to get 12-15%. On a $50,000 investment is the extra $1000-$2500 worth that risk?
As Arn said, I would
Thanks for the advice! I definitely like to do my own diligence for deals (e.g., pressure test rent assumptions, look at market absorption and new construction, evaluate capital stack etc.). There are many deals that don't seem to pencil out. All that being said, I know that I'm not an institutional investor and that some GPs/operators simply can't handle too many questions. So often times, I just ask for the pro formas - is that fair game or a bit too intrusive?
I'm fine with more risk because I feel like if I wanted boring, I might as well stick with ETFs. The way I see this is that GPs are already on the hook for the loan, and the most that I can lose is the capital that I contributed (let's just say $100K as an example). But it's only if I can find the right operators/GPs....
It feels like this year and next year might be great times to find vulture GPs/operators who want to capitalize on distressed assets due to the prevailing high interest rates and expanded cap rates. Another option is to find developers who want to build multifamily by 2026/2027 (assuming that there is loan inventory by then due to the difficulties in securing new construction loans). Are there places that you're looking for syndications now?
Quote from @Arn Cenedella:
I鈥檓 a multifamily syndicator and could toot by own horn but won鈥檛. 馃榾
Check into Left Field Investors.
This is a great group of LPs who share their experiences with GPS across the country. The cost to join is nominal but well worth it.
You might also check out the Best Conference in Salt Lake City starts April 10.
LFI has a one day full day LP presentation the day before the Conference on Tuesday April 9.
This would be a great place to start your search.
Good luck.
One word of advice is you come across a deal where the GP is promoting 8% cash on cash 20% IRR, I'd be very skeptical given the current debt market.
Thanks for the advice! I'll definitely look into Left Field Investors. Given the current debt market and expanded cap rates, are you potentially targeting any distressed assets as a syndicator? It seems like this year and next year might be a good time to invest in these type of deals.
- 2yArn CenedellaPro MemberRental Property Investor 路 Greenville, SC 路 Member since 2008 路 786 posts 路 1k+ votes
Yes there is much hype about MF distress.
It鈥檚 over hyped in my opinion.
While lots of MF assets are in distress, within the total universe of MF properties, I suspect only 10% are in distress.
The truth is generally distressed properties have little or no equity in them so at the end of the day, the lender will be the one in charge.
And the lender will want to sell to a cash buyer who can write a check.
Say a lender is owed $25M on a property, buyer is underwater. The bank might sell the property for $22M provided the NEW buyer can write a check for it.
So whatever distressed assets are out there, inexperienced investors won鈥檛 be getting them. Experienced investors with plenty of cash Millions in Cash will get them.
- 2yNicholas L.Pro MemberFlipper/Rehabber 路 Pittsburgh 路 Member since 2018 路 6k+ posts 路 5k+ votes
just curious, it sounds like you've invested in syndications in the past. is that accurate? what is appealing about them?
- Real Estate Syndicator 路 Milwaukee, WI 路 Member since 2018 路 1k+ posts 路 907 votes2y
There are tons of great syndicators out there. I agree on avoiding the big fundraising platforms..can find better deals directly with the operator.
I would start with answering the following questions:
Do you want stable cashflow or less cashflow with greater upside potential?
Do you have a preference in what market the asset is located?
Do you have a preference on asset class (multifamily, industrial, self storage, etc.)
Are you accredited?
How much capital are you looking to invest?
These are all questions that will narrow down which syndiacators to talk to.
- Investor 路 Batavia, IL 路 Member since 2014 路 102 posts 路 81 votes2y
Forest,
Access is the hardest/ most complicated piece. If an operator/syndicator is using a 506B to raise capital, he cannot advertise. If they use a 506C, they can advertise but usually have a narrow window as they are raising capital for an existing project. That raise will include prior investors, GP partners investing as LP, and other HNW investors adding $50K to $1M to the raise. So, for many Syndicators with powerful track records, the raise may fill very quickly.
If you are looking to gain access to live deals, evaluate projects in various markets, and even access projects in varying asset classes such as value-add multifamily, industrial, self-storage, etc., then you should consider connecting with a broker-dealer group.
Broker-dealer groups provide access, due diligence review, and regulatory compliance for evaluating and participating in the syndication space.
Always interested to connect and chat.
Joe
- 2yIan IppolitoBusiness MemberInvestor 路 Tampa, FL 路 Member since 2015 路 1k+ posts 路 1k+ votesFirst, every investor has a different risk tolerance, financial situation and financial goals. So a sponsor that one investor loves will look terrible to another and vice versa.
Quote from @Forest Wu:
Hi BP family, would anyone have recommendations on the best way to find offmarket syndication opportunities with GPs/operators that have great track records? I'm avoiding deals provided through platforms like FundRise, RealtyMogul, CrowdStreet, etc since often times those deals are the worst in terms of performance.
Put differently, I'm assuming some of the best GPs/Operators don't bother marketing and already have a reliable group of investors to turn to. Any idea how to be a part of those specific groups?
I'm a conservative investor and so a different investor will have a completely different opinion from me (and setup). I have a a 7 figure passive portfolio in syndications and all of the deals (that I'm in currently) were found off-market (i.e. and not through a crowdfunding platform). And that's not due to lack of looking, because I wade through thousands of deals a year (and typically will invest in only a few each year).
And right now, there really isn't an option for an investor like me to go through crowdfunding platforms like CrowdStreet as they no longer have enough volume (they only have 1-2 or so deals now, versus 20-30 in the past). And I'm actually concerned for their viability and ability to survive in the future.
And RealtyMogul and Fundrise don't currently offer deals that meet my personal criteria (of sponsors who have at least a full ballistic cycle of experience with little to no money lost, low leverage, fixed-rate deals, sponsors that put high skin in the game, don't take inordinate compensation etc.). Others will strongly disagree and like these types of deals and feel they're great matches for them. And that's fine, too.
There is an apartment operator that has multiple real estate cycles of experience (decades) with no money lost, low 65% less LTV, and high 10%+ skin in the game.
They market under 506B so are prohibited from posting publicly on the Internet and instead function by referrals. So if you're interested, private message me and I can give you their details.
The Real Estate Crowdfunding Review Quote from @Brock Mogensen:
There are tons of great syndicators out there. I agree on avoiding the big fundraising platforms..can find better deals directly with the operator.
I would start with answering the following questions:
Do you want stable cashflow or less cashflow with greater upside potential?
Do you have a preference in what market the asset is located?
Do you have a preference on asset class (multifamily, industrial, self storage, etc.)
Are you accredited?
How much capital are you looking to invest?
These are all questions that will narrow down which syndiacators to talk to.
I think I have most of these questions answered at this point (e.g., preference for upside and don't care about cashflow, market agnostic, multifamily etc.) It's a matter of finding these syndicators. As I've explored things, it seems like most of the reputable syndicators with good track records turn to institutional investors.
Quote from @Arn Cenedella:
Yes there is much hype about MF distress.
It鈥檚 over hyped in my opinion.
While lots of MF assets are in distress, within the total universe of MF properties, I suspect only 10% are in distress.
The truth is generally distressed properties have little or no equity in them so at the end of the day, the lender will be the one in charge.
And the lender will want to sell to a cash buyer who can write a check.
Say a lender is owed $25M on a property, buyer is underwater. The bank might sell the property for $22M provided the NEW buyer can write a check for it.
So whatever distressed assets are out there, inexperienced investors won鈥檛 be getting them. Experienced investors with plenty of cash Millions in Cash will get them.
That makes sense - thanks for clarifying! It does seem a bit overhyped but I'm also wondering if current owners of these underwater properties are looking for an injection of capital. Rather than lose the property to the bank, wouldn't they prefer to alter their capital stack a bit so they can still hold onto their MF properties? Of course this would mean newer investors would get preferential treatment which would make current LPs unhappy
Quote from @Nicholas L.:
just curious, it sounds like you've invested in syndications in the past. is that accurate? what is appealing about them?
After finding the right operators/GPs, these types of investments can feel much more passive. Depending on one's risk tolerance, you can get very good returns and still benefit from real estate's tax advantages as a LP.
Quote from @Joe Archbold:
Forest,
Access is the hardest/ most complicated piece. If an operator/syndicator is using a 506B to raise capital, he cannot advertise. If they use a 506C, they can advertise but usually have a narrow window as they are raising capital for an existing project. That raise will include prior investors, GP partners investing as LP, and other HNW investors adding $50K to $1M to the raise. So, for many Syndicators with powerful track records, the raise may fill very quickly.
If you are looking to gain access to live deals, evaluate projects in various markets, and even access projects in varying asset classes such as value-add multifamily, industrial, self-storage, etc., then you should consider connecting with a broker-dealer group.
Broker-dealer groups provide access, due diligence review, and regulatory compliance for evaluating and participating in the syndication space.
Always interested to connect and chat.
Joe
I agree with this completely. Access to GPs/operators with strong track records is very difficult. Often times they're completely closed to retail investors unless someone is okay with $2M check sizes per a deal.
Are there any broker-dealer groups that you like and have you gone this path before as a LP? If you are okay with it, just let me know whether I can direct message you and we can carry the conversation from there.
Quote from @Ian Ippolito:
First, every investor has a different risk tolerance, financial situation and financial goals. So a sponsor that one investor loves will look terrible to another and vice versa.Quote from @Forest Wu:
Hi BP family, would anyone have recommendations on the best way to find offmarket syndication opportunities with GPs/operators that have great track records? I'm avoiding deals provided through platforms like FundRise, RealtyMogul, CrowdStreet, etc since often times those deals are the worst in terms of performance.
Put differently, I'm assuming some of the best GPs/Operators don't bother marketing and already have a reliable group of investors to turn to. Any idea how to be a part of those specific groups?
I'm a conservative investor and so a different investor will have a completely different opinion from me (and setup). I have a a 7 figure passive portfolio in syndications and all of the deals (that I'm in currently) were found off-market (i.e. and not through a crowdfunding platform). And that's not due to lack of looking, because I wade through thousands of deals a year (and typically will invest in only a few each year).
And right now, there really isn't an option for an investor like me to go through crowdfunding platforms like CrowdStreet as they no longer have enough volume (they only have 1-2 or so deals now, versus 20-30 in the past). And I'm actually concerned for their viability and ability to survive in the future.
And RealtyMogul and Fundrise don't currently offer deals that meet my personal criteria (of sponsors who have at least a full ballistic cycle of experience with little to no money lost, low leverage, fixed-rate deals, sponsors that put high skin in the game, don't take inordinate compensation etc.). Others will strongly disagree and like these types of deals and feel they're great matches for them. And that's fine, too.
There is an apartment operator that has multiple real estate cycles of experience (decades) with no money lost, low 65% less LTV, and high 10%+ skin in the game.
They market under 506B so are prohibited from posting publicly on the Internet and instead function by referrals. So if you're interested, private message me and I can give you their details.Hi Ian, thanks a lot for this information. I think we have a similar investment philosophy when it comes to evaluating these deals. I'll private message you.
- 2yNicholas L.Pro MemberFlipper/Rehabber 路 Pittsburgh 路 Member since 2018 路 6k+ posts 路 5k+ votes
got it - makes sense.
it seems like, as an LP, you give up both liquidity and control. that's what makes it unappealing to me. if i buy a REIT or index fund i give up control but have high liquidity.
of course if you find the 'perfect' syndicator you get returns that will outpace the market. but that's the challenge, right?
- Investor 路 Batavia, IL 路 Member since 2014 路 102 posts 路 81 votes2y
@Forest Wu,
Forest please feel free to DM me. Glad to discuss
Joe
BREIT by blackstone is private, not publicly traded, and is only sold by blackstone chosen financial advisors, it has 4 different class shares and most have huge load fees (1.5-3.5%) and yearly AUM fees (1.25%), and if you sell <12 months from any share purchase they charge you an exit fee of 2% of NAV price , so be careful with that one
I've invested in many syndications for passivity/market beating returns/tax benefits
currency debasement running at 15% a year since GFC(2008), (ie M2 money supply growth) so you have to get >15% just to tread water in USA now
Quote from @Nicholas L.:
got it - makes sense.
it seems like, as an LP, you give up both liquidity and control. that's what makes it unappealing to me. if i buy a REIT or index fund i give up control but have high liquidity.
of course if you find the 'perfect' syndicator you get returns that will outpace the market. but that's the challenge, right?
Yep, that's the risk that you accept unfortunately - lack of liquidity and control. I've looked at REITs but there is limited upside and you really don't know what you're getting into sometimes. Finding the right syndication opportunity on the other hand could lead to more upside while still having a passive role. I don't want to be involved - that's the GPs job. My role is to make sure that I'm confident in the team and investment philosophy after the initial due diligence.
For some investors, they don't care about the liquidity, cashflow or control anymore. Instead, they just focus on growing wealth and deploy a few hundred thousand each year and every year with the right syndications and wait to see the returns in five to eight years. I do believe that if you pick the right conservative syndications, it's an easy way to diversify, maintain a low risk profile and come out slightly ahead of the market over time. However, I think even these returns will get eaten up as more investors jump in and good operators demand more upside for themselves.
Quote from @Paul Azad:
BREIT by blackstone is private, not publicly traded, and is only sold by blackstone chosen financial advisors, it has 4 different class shares and most have huge load fees (1.5-3.5%) and yearly AUM fees (1.25%), and if you sell <12 months from any share purchase they charge you an exit fee of 2% of NAV price , so be careful with that one
I've invested in many syndications for passivity/market beating returns/tax benefits
currency debasement running at 15% a year since GFC(2008), (ie M2 money supply growth) so you have to get >15% just to tread water in USA now
Any recommendations for syndications? Is it alright if I DM you?
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