I'm new to the multi-family investing and was recently contacted by a company, S.H.A.R.E. Community Development Corp. They promote a low capital entry investment and 100% financing where you can buy a building in a larger community. Curious to see if anyone else has heard of them or know if the company is legit. Seems very questionable.
they appear to be a build to rent type investment. For some who want to be passive, it is a good option. It really depends upon what you're trying to accomplish. If you want to be active, go out and invest in your own deals. You can either invest with a partner, or learn how to syndicate deals.
I have no experience with the company, but they seem as if they are vertically integrated and control most of the processes.
Rental Property Investor · SE Michigan · Member since 2014 · 4k+ posts · 6k+ votes
1y
Yes, this has come up in the forums before, so I've looked into it, but I have no personal experience with this company.
If my kids were considering this, I would advise against this. While the financing and small entry price sound great, you are locked into their ecosystem with very little control. What do you do if you are unhappy with management? If you want to sell do you have to sell through them? If they decide to sell, what happens?
If your credit is good and you can scrape $25K together, you would be better off buying a SF rental.
Yes, this has come up in the forums before, so I've looked into it, but I have no personal experience with this company.
If my kids were considering this, I would advise against this. While the financing and small entry price sound great, you are locked into their ecosystem with very little control. What do you do if you are unhappy with management? If you want to sell do you have to sell through them? If they decide to sell, what happens?
If your credit is good and you can scrape $25K together, you would be better off buying a SF rental.
Greg, clearly you have not put some time to research this directly with SCDC. To be clear, it's 100% ownership of each building through your LLC. Selling the property isn't a problem when it's yours! Quote from @Greg Scott:
Yes, this has come up in the forums before, so I've looked into it, but I have no personal experience with this company.
If my kids were considering this, I would advise against this. While the financing and small entry price sound great, you are locked into their ecosystem with very little control. What do you do if you are unhappy with management? If you want to sell do you have to sell through them? If they decide to sell, what happens?
If your credit is good and you can scrape $25K together, you would be better off buying a SF rental.
Thanks for the feedback Greg. What would you say is a best way to get exposure into multi-family investing? i.e. syndication, partner with other investors, duplex
Rental Property Investor · SE Michigan · Member since 2014 · 4k+ posts · 6k+ votes
1y
That depends what you mean by multifamily. Duplexes, tris, and quads are all valued comps, just like single family. Because of the way they are valued, there isn't that much difference in the business plan for profitably acquiring and running these. If you buy a SF rental, you pretty much have the idea. With more than one unit, the biggest difference is that you have tenants complaining about each other and the property picks up more of the maintenance, like lawn mowing.
There is a huge difference when you get to 5+ units as those are valued using the income method. The business plan to profitability is very different.
If you are just starting out, I'd recommend starting in single family. If, for whatever reason, you don't want to go that route and don't have enough to buy a 5 or 10 unit building, then syndication is one route.
I would caution you to pick your sponsor very wisely. Many charge fees all over the place. One of my most detested is the acquisition fee. This is when syndicators justify getting paid at closing for having done nothing but acquire a property. But, there are many other fees that you could be charged so read the legal docs in full. Other syndiicators are not good operators. When the tide was coming in, it floated all the boats, but some of them are now struggling in this economic cycle. I would also NEVER invest with someone who is just a money-raiser. (There are many out there.) If the person you are talking to is not the person who is going to be overseeing operations, find out who is or don't invest.
they appear to be a build to rent type investment. For some who want to be passive, it is a good option. It really depends upon what you're trying to accomplish. If you want to be active, go out and invest in your own deals. You can either invest with a partner, or learn how to syndicate deals.
I have no experience with the company, but they seem as if they are vertically integrated and control most of the processes.
Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
1y
@Shawn O., like the others, I have not invested with this group. If this is them: https://sharecommunitydevelopmentcorp.com/, I have some pauses. I like simplicity, which this does not seem to have, based on their website.
That being said, as others noted, I would look at what your goals are first. This appears to be buying into a turnkey development. You are putting money in, and qualifying for the construction loan, while being forced to use them to execute and lease up. As Greg noted, there is a lot that I would want to be crystal clear on with how it is structured, how you can remove yourself, if needed, how you can change management or sell.
Investor · Miami, FL · Member since 2015 · 355 posts · 268 votes
1y
Some great answers already. I'll add, in investing you have to follow your gut and if you're already calling it "very questionable", drop it and move on. There are limitless other investing possibilities out there.
Real Estate Agent · Jacksonville, FL · Member since 2023 · 10 posts · 10 votes
1y
As a BTR guy myself, I always encourage people to look at their exit strategy.
If you're buying into an all "investor owned" development you will need to sell to an investor down the road. This is ok but being able to sell a property to a homeowner down the road has always yielded me the best profits. Build to rent does not have to happen only in a full community build out. They can also be available in existing neighborhoods in infill lots. I like these areas as it has a good ratio of homeowners and renters and the neighborhood is already established
I'm new to the multi-family investing and was recently contacted by a company, S.H.A.R.E. Community Development Corp. They promote a low capital entry investment and 100% financing where you can buy a building in a larger community. Curious to see if anyone else has heard of them or know if the company is legit. Seems very questionable.
update: I spoke to a rep from the company who provided more detail on their turnkey project. They are unique in the fact that the development is completely vertically integrated project in which they do everything from manufacturing the building materials to manage your property. The catch is you have to use their designated companies for everything including financing, management, and maintenance. Also there's a down payment assistance program (still trying to understand) which is how you're able to get the project 100% financed and bring very little capital to start. In regards to an exit strategy the property is yours and you can sell at anytime but the financing is structured to where it's best to hold for at least 12 months. This is my first time posting on the forum so I really appreciate everyone's feedback as it's helped me think through this offer.
I'm new to the multi-family investing and was recently contacted by a company, S.H.A.R.E. Community Development Corp. They promote a low capital entry investment and 100% financing where you can buy a building in a larger community. Curious to see if anyone else has heard of them or know if the company is legit. Seems very questionable.
update: I spoke to a rep from the company who provided more detail on their turnkey project. They are unique in the fact that the development is completely vertically integrated project in which they do everything from manufacturing the building materials to manage your property. The catch is you have to use their designated companies for everything including financing, management, and maintenance. Also there's a down payment assistance program (still trying to understand) which is how you're able to get the project 100% financed and bring very little capital to start. In regards to an exit strategy the property is yours and you can sell at anytime but the financing is structured to where it's best to hold for at least 12 months. This is my first time posting on the forum so I really appreciate everyone's feedback as it's helped me think through this offer.
Hey Shawn, did you end up joining them or working with them?