Is Syndicate Investing the Best Way to Start

Multi-Family and Apartment Investing
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Is Syndicate Investing the Best Way to Start

Jordan D'Silva
Investor · Dallas, TX · Member since 2020 · 104 posts · 43 votes

I have been trying to get into the MF space for a while, and I've started learning more about syndicates like Think Multifamily and Jake and Gino. What are your thoughts on joining a syndicate as the best strategy to start investing in large deals and if so what are your favorites. Would love to hear your experiences. 

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Lucia Rushton
Realtor · Dallas - Fort Worth Metroplex, TX · Member since 2016 · 1k+ posts · 925 votes
5y

@Jordan D'Silva are you looking for an active or passive role ? MF is a completely different animal and is a team sport ! There are networking groups in Dallas - branch out and start learning the lingo.

Some questions as well ( no need to answer publicly )

- how much $ do you have to invest

-how much time do you have to spend searching, underwriting, negotiating and then managing a deal

- what are your goals

-have you acquired an underwriting template. When you do, practice practice practice

- and just as a heads up Commercial brokers can’t and usually won’t hand-hold a newbie investor like an investor friendly residential realtor will

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  • Hadar OrkibiPro Member
    Rental Property Investor · USA / NZ · Member since 2016 · 1k+ posts · 812 votes
    5y

    Hey @Jordan D'Silva Syndication as a whole is a good way to start, especially if you are investing with the right deal sponsors / general partners. (this is the group that typically finds and manages the deal).

    More often than not you will be investing as a passive investor, most syndication has a minimum of $50k and may require you to be a sophisticated or accredited investor this is depending on the "permit' they get from the SEC.

    Jake and Gino own RAND Partners, I have few friends that invested with them and they are very happy.
    They also have a coaching business which is great.

    Another one to check out is Chris Jackson from Sharpline Equity.

    one thing is for sure, the most important is to invest with a reputable Syndicator. you invest in the operators and not in the property!! 

    3Reply
  • Brian Pownall
    Investor · Houston, TX · Member since 2020 · 77 posts · 66 votes
    5y

    There is a group online called Left Field Investors that has put together a list of syndication groups that the members have invested in. Recommend checking out as a resource and you can contact the various groups to learn more. Was extremely helpful for me when I started to passively invest.

    3Reply
  • Jonathan GreeneBusiness Member
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    5y

    It really depends what your goal is. If you want to learn about the process, syndication isn't going to give you any hands-on knowledge, just a return and some paperwork or updates about how they got that return. Personally, it's not hands-on enough to me to start a journey in REI. It's passive and a good part of a portfolio, but it's not a way into learning about investing, it's just a way to say you are investing in my opinion.

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    2Reply
  • Lucia Rushton
    Realtor · Dallas - Fort Worth Metroplex, TX · Member since 2016 · 1k+ posts · 925 votes
    5y

    @Jordan D'Silva are you looking for an active or passive role ? MF is a completely different animal and is a team sport ! There are networking groups in Dallas - branch out and start learning the lingo.

    Some questions as well ( no need to answer publicly )

    - how much $ do you have to invest

    -how much time do you have to spend searching, underwriting, negotiating and then managing a deal

    - what are your goals

    -have you acquired an underwriting template. When you do, practice practice practice

    - and just as a heads up Commercial brokers can’t and usually won’t hand-hold a newbie investor like an investor friendly residential realtor will

    4Reply
  • Bruce Lynn
    Real Estate Broker · Coppell, TX · Member since 2011 · 5k+ posts · 4k+ votes
    5y

    @Jordan D'Silva    I think it really comes down to how much you have to invest and the amount of assets.  Most syndicators are looking for investors with a $1mil or more in assets and minimum $50,000-$100,000 to invest.  Occasionally you'll see some $25,000 raises, but that seems rare.   There are also some deals that allow for sophisticated investors.   You can look up what that entails.   Your investment also needs to be money that you don't need for 2-3-5-7-10 years.  Probably average hold time is see is about 5 years.  Illiquid investments that may or may not cash flow and may or may not cash flow in first 2-3 years.

    Probably the best and easiest investment for someone just getting started is an owner occupied home. The reason for this is low down payment....allows for some chance of tax advantages, allows some chance for income by setting up a bedroom or two for AirBnB. While some say it is illiquid, in todays market I would make the argument if you need to sell, you should be able to do that. Maybe if your job or life changes. After a year you could also potentially turn it into a rental and repeat...BRRRR.

    2Reply
  • Evan Polaski
    Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
    5y

    @Jordan D'Silva, as others noted, your goals will dictate the answer.  If you are just wanting to diversify away from equities or the single family rentals, then syndications can be great.  If you are wanting to learn the ropes of operating real estate, it can give you some insight, but will not replace hands on experience.  

    As noted, you will likely get some type of monthly or quarterly reporting on operations, some frequency of financial detail, and hopefully the ability to ask questions, but I don't believe any syndicator will hold your hand through acquisitions, due diligence, asset management, etc.  High level questions, yes, but letting you sit on phone calls with brokers or buyer interviews, I can't imagine that happening for an LP.

    From there, as mentioned, there are investment minimums and accredited investor status that may also effect your ability to be an LP anyways.

    2Reply
  • Jeffrey Donis
    Investor · Durham, NC · Member since 2020 · 1k+ posts · 691 votes
    5y
    Originally posted by @Jordan D'Silva:

    I have been trying to get into the MF space for a while, and I've started learning more about syndicates like Think Multifamily and Jake and Gino. What are your thoughts on joining a syndicate as the best strategy to start investing in large deals and if so what are your favorites. Would love to hear your experiences. 

    Hey Jordan!

    I have heard that these are the two best ways to get started- 

    1) Getting into a mentorship/group

    2) Passively investing in a deal and learning that way.

    Both take money, however whichever you prefer is up to you. I chose to go the coaching route and have been with Think Multifamily for a few months- it has been amazing. Nothing but good things - we can connect if you want to learn more about my experience with them! My buddies actually just joined the Jake and Gino program and they see to like it so far although they very recently joined so I could put you in touch with them as well! 

     Let me know if there is any way I can help!

    Thanks,

    Jeff

    0Reply
  • Bill B.
    Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
    5y

    Higher initial investment, lower returns and you're not learning anything compared to your SFR. But at least you have less control and decision input. Why not just invest in stocks or a REIT if you don't want to have all your investments in the kind of real estate you understand.

    1Reply
  • Justin Goodin
    Investor · Indianapolis, IN · Member since 2018 · 1k+ posts · 756 votes
    5y

    @Jordan D'Silva Assuming you are referring to joining a coaching program, it all comes down what you are willing to do to get to your goals. The right coaches can certainly help you get there but it still takes a ton of patience, persistence, and time. There is no magic coaching program. 

    Make sure whatever mentoring program you join, they have the same goals as what you are trying to accomplish. 

    0Reply
  • Justin Goodin
    Investor · Indianapolis, IN · Member since 2018 · 1k+ posts · 756 votes
    5y
    Originally posted by @Brian Pownall:

    There is a group online called Left Field Investors that has put together a list of syndication groups that the members have invested in. Recommend checking out as a resource and you can contact the various groups to learn more. Was extremely helpful for me when I started to passively invest.

    I have not heard of this group. Thanks for the info. 

    0Reply
  • Justin Goodin
    Investor · Indianapolis, IN · Member since 2018 · 1k+ posts · 756 votes
    5y

    @Jonathan Greene Do you mean by passively investing? I have heard that some sponsors may be more willing to give you a look behind the scenes, but to your point, that is not the intent. Passively investing is meant to be just that - passive!

    0Reply
  • Justin Goodin
    Investor · Indianapolis, IN · Member since 2018 · 1k+ posts · 756 votes
    5y
    Originally posted by @Lucia Rushton:

    @Jordan D'Silva are you looking for an active or passive role ? MF is a completely different animal and is a team sport ! There are networking groups in Dallas - branch out and start learning the lingo.

    Some questions as well ( no need to answer publicly )

    - how much $ do you have to invest

    -how much time do you have to spend searching, underwriting, negotiating and then managing a deal

    - what are your goals

    -have you acquired an underwriting template. When you do, practice practice practice

    - and just as a heads up Commercial brokers can’t and usually won’t hand-hold a newbie investor like an investor friendly residential realtor will

     Great points! This will certainly take a lot of time to learn yourself. 

    1Reply
  • Chris Levarek
    Real Estate Syndicator · Phoenix, AZ · Member since 2018 · 903 posts · 1k+ votes
    5y

    @Jordan D'Silva Typically three ways in :

    Option 1 : SELF-EDUCATE, HARD WORK AND ACTION - “GO IT ALONE”. - This option is where an investor decides to get into commercial syndication by pure sweat equity or hard work. Rather than purchase a mentorship or network, the investor or aspiring syndicator chooses to progress organically through small multifamily or single-family acquisitions into large multifamily or commercial acquisitions.

    Option 2 : PAY FOR A MENTORSHIP OR NETWORK . - This option is usually the most obvious and apparent way into apartment syndication. The aspiring syndicator can purchase a mentorship with a qualified or experienced syndicator or investor in the asset class of choice. By paying for a mentorship, typically the investor will get access to not only a mentor coach with weekly/monthly calls or accountability check-ins but all the resources and network of the mentor/program to include contacts, connections, templates, documents, learning videos, etc.

    Option 3 : PARTNERSHIP. - This option is where the investor or aspiring syndicator is able to be involved on a syndication project whether passively or actively and in thus manner learns while receiving the benefits of being on the project. In the case of the passive investment as a limited partner, instead of paying for learning in a 1 and 1 exchange in a mentorship, the investor is paying for all the real estate investment benefits while learning how a syndication works(requires the right syndication group). In the case of providing value as a managing partner in one role (asset management, capital-raising, deal-finding, investor relations, infrastructure management, etc), an investor or syndicator can learn the other roles or full process of a syndication while only playing a specific role they are good at.

    Each has their own pros/cons. I wrote an article on it a while back discussing these, if interested, I can dm but BP won't allow posts from external websites here so :)

    Hope that helps!

    2Reply
  • Jordan D'Silva
    OP
    Investor · Dallas, TX · Member since 2020 · 104 posts · 43 votes
    5y

    @Jordan D'Silva thank you to everyone for the responses and recommendations on syndications. If anyone is interested in pursuing a partnership or talking further, please send me a message.

    0Reply
  • Jordan D'Silva
    OP
    Investor · Dallas, TX · Member since 2020 · 104 posts · 43 votes
    5y

    @Chris Levarek thank you, this is great advice. I believe I’m a best fit for a partnership, if you know anyone looking for a partner or groups to find partners, I would appreciate talking further

    0Reply
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