I have found a handful of great deals I am looking to transact on in the near future and was looking for creative ways to come up with the equity piece of the deal. I have worked on more then 17 acquisitions to date using traditional partner of GP + LP structures and on this one I am hoping to be the only one in on the deal or have more skin in the game but am not liquid enough to get the deal done on my own. What are some options to get a loan for the equity portion of this deal with the duration of the equity loan lasting more than 24 months without going the route of HELOC or Refi? All suggestions welcome.
You can go the route of syndication. Issue a high (8+ %) Preferred Rate of Return and a LOW percentage of the upside to the investors. After stabilization (if value add), refinance the property, basically pay off the investors and end up owning majority of the asset.
Following- I was considering the same thing myself and wondering how to do syndication
@Zachary Feldman looking to use debt to cover your equity eh? I'd call that 100% leverage. That position carries a lot of risk. Have you heard the phrase "don't go long with short term money?" If you can steal the deal and there's huge value add it may be worth the risk. Otherwise very likely it will sink you. Remember leverage can make you or F'ing break you! I'm fortunate. I got a front row seat to a real estate crash early in my career. Read up on your history young jedi.
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