Multi family Syndication
My brothers and I have been wholesaling for 1 year however we want passive income. We have made the decision to go into multi family syndication with the money and experiment we gained after a successful first year. We have been self educating and know the roles we will play in the syndication process and what the steps of doing so are- does anyone have any advice
Hi @Jeffrey Donis . Are you looking to invest in a syndication or syndicate your own deals?
If you are looking to syndicate your own projects I would keep building a track record and start gaining experience with buy and holds, or investing in another syndication to gain experience that way (to see how it works).
Wholesaling and MF syndication are pretty different in terms of strategy and operations and it might be a stretch to say to an investor "we've been wholesaling for a year, that makes us qualified to run an apartment community and run a syndication" they're just two completely separate businesses.
That being said, I would start to build your team: Transaction RE attorney, CPA w/ cost seg capabilities, SEC attorney, lenders, insurance, property management, and brokers.
If you have the team, your focus should be on two things: raising capital and finding deals.
For raising capital consider what kind of investor platform you will develop, what kind of marketing and content to produce, develop an investor onboarding process, and what investment portal you will use. It can often take 32 leads for one to convert into an investor. If you are using ads, it can easily cost $1,000+ per investor.
Hope this helps!
@Spencer Gray
Thank you for the response! We have been educating for awhile now and are definitely going to start building out our team. After reading joe fairless’s book on syndication we decided that the first step to that would be finding a mentor who is currently doing doing. We would bring value to them by bringing deals since we know how to market and generate leads and in exchange we could potentially partner up on the deal. We would be willing to invest in it ourselves also. Would that be the best way to go about finding a mentor?
Originally posted by @Jeffrey Donis:@Spencer Gray
Thank you for the response! We have been educating for awhile now and are definitely going to start building out our team. After reading joe fairless’s book on syndication we decided that the first step to that would be finding a mentor who is currently doing doing. We would bring value to them by bringing deals since we know how to market and generate leads and in exchange we could potentially partner up on the deal. We would be willing to invest in it ourselves also. Would that be the best way to go about finding a mentor?
Bringing deals is a pretty tried and true way to build in syndication. It sounds like you're looking for a partner in addition to mentorship. If you already have deal flow in the space you could put together a couple of samples and start looking for established sponsors that would be open to partnering. I believe Mark Kenney at Think Multifamily partners with some of his students.
@Taylor L.
Awesome! I will definitely be reaching out to them. I appreciate it! Looking forward to staying in touch + connecting 🙏🏼
@Jeffrey Donis That could certainly work. Just keep in mind finding MF deals that are large enough to syndicate isn't like going after SFR and smaller multifamily up to 50 units. Most deals are still sourced through brokers with the majority of "off market" deals are actually just deals that a broker has that receive and accept a preemptive offer before it hits the market.
If your skill set is marketing and generating leads, I would build a platform to generate investor leads. You could even offer to an active syndicator that doesn't have a robust marketing and lead generation operation that you will build out and even run their lead generation/marketing in exchange for a % of the GP. To me that is much more valuable than bringing 1 deal.
That way you are bringing value right away and building a working relationship. Just bringing a deal sounds like we'll have one conversation and I may or may not hear from you until you find something that might not fit the criteria.
@D Donis you should join a local networking group to find a mentor or get involved with a virtual group
@Spencer Gray
That’s a great tip 🙏🏼. We have a decent following so now we are focusing on tailoring our content towards generating passive investors and possibly leads from other wholesalers who market to MF. I love the idea and will 100% implement it. Thanks a lot!!
@Danny Randazzo
Will do!! Other than Facebook and BP, is there another platform that you recommend where we can connect with such a group? Thanks for the response !
@D Donis
Joe fairless is a good start, but there are a ton of syndicators out there that have educational content. Soak it all up, read a lot and build your network.
My piece of advice that I really think is the first step is to mock up a deal as though you were offering it. Have it down to an operating agreement, a webinar and all the necessary documents but a property under contract and ready to go. This may cost some money and certainly some time to get to, but if you’re serious about it it will allow for you to talk intelligently with examples to investors and once you do have one under contract will go a lot smoother.
Other things to check out:
@Brian Burke book the hands off investor
Jake and Geno wheel barrel profits
The Michael blank apartment show
Westside investors network
Whitney Sewells podcast
Passive wealth strategies
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Broker Oregon (#201206275)
- Uptown Syndication
@AJ Shepard
Hey AJ,
Thanks a lot for the response! We will get right on those references + start the process of offering one in our area. Great tip!! Being the branding side of the business I will make to continue networking. Thanks again! Hope you have a blessed day.
#2 Tax, SDIRAs & Cost Segregation Contributor
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#2 Tax, SDIRAs & Cost Segregation Contributor
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The post is a little confusing - You mention wanting to be more "passive" but then you hint at wanting to start up a syndication(assumable as a GP)
That is definitely not going to be passive.
You have to manage the deal, manage the relationships, manage your employees, find the deals.
Not the definition of passive.
If you want passive, you invest either in stocks, bonds or as an LP/non-managing member.
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CPA
- Basit Siddiqi CPA, PLLC
- 917-280-8544
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#2 Multi-Family and Apartment Investing Contributor
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Check out the vast array of podcasts out there. Also, attend meet ups (meetup.com and biggerpockets). Keep the education train going.
Research markets and submarkets to invest in and understand your investing criteria. https://www.biggerpockets.com/...
You're also going to need to begin building a list of potential investors and creating ways to engage them and new investors. https://www.biggerpockets.com/...
https://www.biggerpockets.com/...
Next, you'll need to build a team. I would call property managers, lenders, attorneys, title companies, appraisers, before you call real estate brokers. This arms you with a ton of knowledge and confidence. https://www.biggerpockets.com/...
@D Donis check out meet up and also multifamily investor nation
@Todd Dexheimer
Awesome info!! Really appreciate it thanks a lot!!!
@Danny Randazzo
Will do!! Thanks again !
@Jeffrey Donis check out meet up and multifamily investor nation
@Basit Siddiqi
Thanks for the input! We understand that it is going to be a time commitment, however unlike wholesaling where it is transactional, we will be making passive income off of the asset. You are right I may have misused the word “passive” - I could have been more clear on that. Thanks for pointing that out!