After educating myself, researching the market, & looking for deals, I've decided my best get to jump to 50+ multifamily properties would be to coat tail an experienced investor on a syndication... If you have something in the works or know someone who does... Id like to get a fair portion of equity for my cash investment, only willing to invest with a person whom has a good track record and is putting cash in the deal... My goals for this transaction other than the income potential would be to learn the due diligence, appraisal, repairs, managing the property..
You are looking for the perfect mix. I would bet that you will have to give somewhere to get into a deal with everything that you want. Most experienced syndicators that are bringing cash to the table don't have time to teach someone the ropes of doing the deal. You could give up more equity or request a lower return however you would probably need to be the single investor on the deal. The syndicator is going to want to structure the deal consistently across the board for all investors. I'm not saying that they couldn't offer you a lower amount of equity and return for the same $1 that other investors put in however that can get complicated.
Your best bet is to work with a smaller experienced multi-family investor that is looking to grow. Someone that has experience with 10-60 unit buildings and has built a strong track record. With smaller sized buildings you could potentially be the sole investor on the deal. You could still have the syndicator put in some funds however request a lower equity stake in exchange for learning the ropes. Also I would spell out exactly what the mentorship looks like on paper. You both might have very different expectations on what that looks like. And as always have an experienced securities lawyer put together the transaction.
I agree completely. However what I was stating was merely I don't want to bring 100-200k+ into a partnership, be the only cash and still have a lower equity share.. I understand the push and pull, cost for experience..
Thanks for the advise.. A smaller investor is exactly what I would like to work with..
With the right person and the right structure (operating agreement) it could be perfectly fine to do a 50/50 split where you bring all the capital to the table in exchange for guidance and a solid preferred return. You will be playing in the full recourse loan market so both of you would need to personally guarantee the loan. A lot will hinge on the investor putting the deal together. Make sure you properly vet anyone thoroughly. Background check, references, credit check, etc etc. If they balk then walk...maybe that should be my slogan??? Honestly I would have no problem with providing that information to a potential investor. You can even have the potential financing bank show you their credit report so they can avoid an inquiry.
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