Anyone Raising a Single-Asset Multifamily Syndication or Know of One?
Scott TrenchPro Member
Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votesAnyone Raising a Single-Asset Multifamily Syndication or Know of One?
Most Popular Reply
Arn CenedellaPro Member
Rental Property Investor · Greenville, SC · Member since 2008 · 786 posts · 1k+ votesYour question assumes one can time the market.
I submit for your consideration the following:
The top or bottom of any market is only known 6 to 12 months after the fact.
I’ve been a real estate investor for over 45 years since 1979 and I don’t try to time the market.
I buy quality properties in quality locations and have a long term perspective. With this approach, one does not need to be the “smartest person” in the room, one only has to be prudent and knowledgeable about their market.
If one buys a property correctly - ie proper leverage long term fixed rate debt and has sufficient cash reserves, then one can buy in confidence 7 to 10 years later the purchase will be a good investment.
The finish line isn’t 1 or 2 years from now it’s 7 to 10 years from now. So I still buy even knowing the value may drop a little in the short term (but you see I don’t care as I am looking long term) for future benefits.
Granted one must be selective in this market.
I’m still a buyer.
26 Replies
- 2yArn CenedellaPro MemberRental Property Investor · Greenville, SC · Member since 2008 · 786 posts · 1k+ votes
I am raising for a new BTR project in Greenville SC. Will be a 506b.
- Real Estate Broker | Investor | Property Manager · Plantation, FL · Member since 2015 · 228 posts · 69 votes2y
@Scott Trench I am currently raising on a 506(c) 120-unit multifamily acquisition set to close within a matter of weeks once Freddie Mac completes the review of our low interest rate debt assumption. Happy to chat further.
- 2yMelanie P.Pro MemberRental Property Investor · Member since 2023 · 1k+ posts · 922 votes
Please help a dummy like me understand why you think this would be a good time to be a minority investor in large multi family?
- Real Estate Broker | Investor | Property Manager · Plantation, FL · Member since 2015 · 228 posts · 69 votes2y
Quote from @Melanie P.:
Please help a dummy like me understand why you think this would be a good time to be a minority investor in large multi family?
First off, please don't feel like a dummy. Real estate is a complex industry with a LOT of niche ways to be active (or passive) within the space. No one knows everything!
There are many things that counter your sentiment of concern of investing in the current capital market environment. In commercial investments like syndications, you have a lot more creativity and flexibility to acquire a property on positive terms. These could be terms that end up insulating you from risks that the majority of the market could be affected by.
For example, I am co-sponsor of a multifamily investment right now that is assuming debt at 3.64% fixed-rate interest with a loan term lasting for 8 more years. This allows our group to be protected from the high interest-rate volatility that is prevalent right now.
That is an example on how you can "Buy Right" when looking for a property. Also, when buying a larger asset, you are scaling your operating costs and maintenance costs to a lower operating expense % (unless you are buying distressed assets).
At the end of the day you should look a lot closer at information provided by an operator to validate their claims. Don't just take their word for it, because you want to know that you are buying into a cash flowing asset that will at least come close to projections. Personally, I wanted our underwriting to be so conservative that we would be able to mitigate a majority of the risk. The only result to our team has been a slow yet steady stream of LP investments rather than a flood of initial requests. We are happy about this because the quality of LPs that have joined has been strong and we can sleep easier at night knowing we haven't needed to hype or over-promise at all.
Happy to chat further about your specific concerns on timing in today's market...
- 2yArn CenedellaPro MemberRental Property Investor · Greenville, SC · Member since 2008 · 786 posts · 1k+ votes
Your question assumes one can time the market.
I submit for your consideration the following:
The top or bottom of any market is only known 6 to 12 months after the fact.
I’ve been a real estate investor for over 45 years since 1979 and I don’t try to time the market.
I buy quality properties in quality locations and have a long term perspective. With this approach, one does not need to be the “smartest person” in the room, one only has to be prudent and knowledgeable about their market.
If one buys a property correctly - ie proper leverage long term fixed rate debt and has sufficient cash reserves, then one can buy in confidence 7 to 10 years later the purchase will be a good investment.
The finish line isn’t 1 or 2 years from now it’s 7 to 10 years from now. So I still buy even knowing the value may drop a little in the short term (but you see I don’t care as I am looking long term) for future benefits.
Granted one must be selective in this market.
I’m still a buyer.
- 2yJoshua ChristensenPro MemberReal Estate Broker · Albuquerque, NM · Member since 2015 · 285 posts · 232 votes
Quote from @Scott Trench:
Hi Folks
Looking for someone who is currently putting together a single-asset multifamily syndication currently.
Can anyone point me in the right direction or let me know if they are raising for one?
I am not looking for funds, past deals, deals that have already been fully subscribed, folks contemplating deals in the near future, items right around the corner, etc.
Also, not looking for NNN, Commercial, REITs, or other asset types for this post.
Thanks in advance!
Hey there Scott, I'm currently raising a 506b on a deal in Oklahoma City. 69 units.
- 2yJoshua ChristensenPro MemberReal Estate Broker · Albuquerque, NM · Member since 2015 · 285 posts · 232 votes
Quote from @Whitney McNair:
I'm looking for investors for a 69 unit in Oklahoma City.
yeah you are! lol
- Member since 2024 · 1 post · 0 votes2y
Currently raising for a multi fam project in seattle, WA.
- 2yBen ScottPro MemberProperty Manager · Oklahoma City, OK · Member since 2019 · 580 posts · 351 votes
Hey @Joshua Christensen, what part of town is your 69 unit deal?
- 2yJoshua ChristensenPro MemberReal Estate Broker · Albuquerque, NM · Member since 2015 · 285 posts · 232 votes
@Ben Scott it's N Central OKC. N Meridian / 10th
- Developer · Seattle, WA · Member since 2018 · 90 posts · 47 votes2y
Quote from @Linda Mejia:
Currently raising for a multi fam project in seattle, WA.
Bold - not many others operate here. Happy to learn more
- Developer · Seattle, WA · Member since 2018 · 90 posts · 47 votes2y
@Scott Trench currently raising on a 33-unit existing townhome community in Central WA's city of Wenatchee. I am operating a 30-unit apartment in the city already.
Base case scenario is straightforward renovation, add class A amenity package, improve NOI and resell as a single asset.
I will be focused, however, on converting the townhomes into condominiums and selling individually to homeowners. We'll have a for sale product that is 15-22% cheaper than what's being sold and on market with the same finishes.
- Rental Property Investor · Burlington, WA · Member since 2017 · 4 posts · 0 votes2y
What’s the address and price point you will be selling?
- 2yMelanie P.Pro MemberRental Property Investor · Member since 2023 · 1k+ posts · 922 votes
Quote from @Karl Krauskopf:
Quote from @Linda Mejia:
Currently raising for a multi fam project in seattle, WA.
Bold - not many others operate here. Happy to learn more
Bold? I'd use the word "telling." When someone operates by pitching an investment on here it tells me that they have no compliance department, no legal, no offering documents, no care to evaluate the suitability of potential investors, no disclosures, no financials, are not registered and so on. They have a story, they might have done something in real estate before and they'd like someone's money. Not gonna end well.
I predict there will be criminal and SEC civil prosecutions of some of these syndicators. The combination of high interest and declining rents is going to cause some of their existing book to zero out.
- Developer · Seattle, WA · Member since 2018 · 90 posts · 47 votes2y
Quote from @Melanie P.:
Quote from @Karl Krauskopf:
Quote from @Linda Mejia:
Currently raising for a multi fam project in seattle, WA.
Bold - not many others operate here. Happy to learn more
Bold? I'd use the word "telling." When someone operates by pitching an investment on here it tells me that they have no compliance department, no legal, no offering documents, no care to evaluate the suitability of potential investors, no disclosures, no financials, are not registered and so on. They have a story, they might have done something in real estate before and they'd like someone's money. Not gonna end well.
I predict there will be criminal and SEC civil prosecutions of some of these syndicators. The combination of high interest and declining rents is going to cause some of their existing book to zero out.
passionate generalization
- Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes2y
I agree with your overall sentiment of the syndication space, but not of your callout of the people on this thread. I asked, they answered. They have theses they believe in, otherwise, they wouldn't be putting together the deals.
I'm a massive bear on the multifamily space in 2024, and not afraid to say so. I will come out in the next week or so with 5,000 words discussing why another 30% drop in values from the present is possible this year.
That said, there are regional variances, and the people on this thread feel opposite to my views. Which is why I asked.
Of course, you are right that this is the wild west. How can it not be? The assets are sized in that sweet spot of $5-$10M, where it's too small to afford a compliance department, but big enough to meaningfully impact the lives of the operators, investors, and tenants who are all interrelated.
There are fortunes to be made, and lost, in this space. There are scammers, bad operators, the unlucky. There are also those who are honest, try their best, believe, and who will win. And the BiggerPockets community will be forever obsessed with it, as I am. It's the obvious next step for real estate investors who have amassed large portfolios, but aren't ready to move into instutitional assets.
I wonder - what's the right way to make this productive for these investors? I don't want to wait for the SEC, and would rather democratize this here on BiggerPockets. I think that we need to hold two groups accountable:
- The Syndicators
- The LPs who invest with them
Syndicators should aspire to ever greater professionalism, legal, diligence, and compliance bars.
LPs should aspire to the same, and to being able to identify "good", differentiate it from "bad" and call out and share their experiences for the community to collectively improve.
- 2yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Karl Krauskopf:
Quote from @Melanie P.:
Quote from @Karl Krauskopf:
Quote from @Linda Mejia:
Currently raising for a multi fam project in seattle, WA.
Bold - not many others operate here. Happy to learn more
Bold? I'd use the word "telling." When someone operates by pitching an investment on here it tells me that they have no compliance department, no legal, no offering documents, no care to evaluate the suitability of potential investors, no disclosures, no financials, are not registered and so on. They have a story, they might have done something in real estate before and they'd like someone's money. Not gonna end well.
I predict there will be criminal and SEC civil prosecutions of some of these syndicators. The combination of high interest and declining rents is going to cause some of their existing book to zero out.
passionate generalization
Wenatchee is a total under the radar home run market. Unless Melanie knows this market I would just take her comments like you said a big generalization.. I predict over the next 25 years that area will be a huge winner for RE .. I mean look at what happened in Bend Or. and Wenatchee has 5X the potential of Bend.. other than Bend has a better ski mountain. - Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes2y
If the multifamily space crashes, it will bring the regional banks (and, therefore, the economy) down with it. All bets are off when credit seizes up.
- 2yAndrew HoganPro MemberRental Property Investor · Indianapolis, IN · Member since 2016 · 560 posts · 463 votes
Quote from @Scott Trench:
I agree with your overall sentiment of the syndication space, but not of your callout of the people on this thread. I asked, they answered. They have theses they believe in, otherwise, they wouldn't be putting together the deals.
I'm a massive bear on the multifamily space in 2024, and not afraid to say so. I will come out in the next week or so with 5,000 words discussing why another 30% drop in values from the present is possible this year.
That said, there are regional variances, and the people on this thread feel opposite to my views. Which is why I asked.
Of course, you are right that this is the wild west. How can it not be? The assets are sized in that sweet spot of $5-$10M, where it's too small to afford a compliance department, but big enough to meaningfully impact the lives of the operators, investors, and tenants who are all interrelated.
There are fortunes to be made, and lost, in this space. There are scammers, bad operators, the unlucky. There are also those who are honest, try their best, believe, and who will win. And the BiggerPockets community will be forever obsessed with it, as I am. It's the obvious next step for real estate investors who have amassed large portfolios, but aren't ready to move into instutitional assets.
I wonder - what's the right way to make this productive for these investors? I don't want to wait for the SEC, and would rather democratize this here on BiggerPockets. I think that we need to hold two groups accountable:
- The Syndicators
- The LPs who invest with them
Syndicators should aspire to ever greater professionalism, legal, diligence, and compliance bars.
LPs should aspire to the same, and to being able to identify "good", differentiate it from "bad" and call out and share their experiences for the community to collectively improve.
Great points @Scott Trench. Our most recent single asset is no longer available but we're always keeping an eye out ;)
- Investor · Indianapolis, IN · Member since 2018 · 1k+ posts · 756 votes2y
Quote from @Scott Trench:
I agree with your overall sentiment of the syndication space, but not of your callout of the people on this thread. I asked, they answered. They have theses they believe in, otherwise, they wouldn't be putting together the deals.
I'm a massive bear on the multifamily space in 2024, and not afraid to say so. I will come out in the next week or so with 5,000 words discussing why another 30% drop in values from the present is possible this year.
That said, there are regional variances, and the people on this thread feel opposite to my views. Which is why I asked.
Of course, you are right that this is the wild west. How can it not be? The assets are sized in that sweet spot of $5-$10M, where it's too small to afford a compliance department, but big enough to meaningfully impact the lives of the operators, investors, and tenants who are all interrelated.
There are fortunes to be made, and lost, in this space. There are scammers, bad operators, the unlucky. There are also those who are honest, try their best, believe, and who will win. And the BiggerPockets community will be forever obsessed with it, as I am. It's the obvious next step for real estate investors who have amassed large portfolios, but aren't ready to move into instutitional assets.
I wonder - what's the right way to make this productive for these investors? I don't want to wait for the SEC, and would rather democratize this here on BiggerPockets. I think that we need to hold two groups accountable:
- The Syndicators
- The LPs who invest with them
Syndicators should aspire to ever greater professionalism, legal, diligence, and compliance bars.
LPs should aspire to the same, and to being able to identify "good", differentiate it from "bad" and call out and share their experiences for the community to collectively improve.
Hi Scott,
I wouldn’t waste too much time trying to reason with Melanie. Every comment she posts in the forums is extremely negative.
Anyways, we have an exciting opportunity that I will send you. Thanks.
- Rental Property Investor · Broken Arrow, OK · Member since 2016 · 1k+ posts · 1k+ votes2yPlease send info on the OKC deal and any others you’re raising for in Oklahoma. Thanks!
- Developer · Seattle, WA · Member since 2018 · 90 posts · 47 votes2y
Quote from @Jay Hinrichs:
Quote from @Karl Krauskopf:
Quote from @Melanie P.:
Quote from @Karl Krauskopf:
Quote from @Linda Mejia:
Currently raising for a multi fam project in seattle, WA.
Bold - not many others operate here. Happy to learn more
Bold? I'd use the word "telling." When someone operates by pitching an investment on here it tells me that they have no compliance department, no legal, no offering documents, no care to evaluate the suitability of potential investors, no disclosures, no financials, are not registered and so on. They have a story, they might have done something in real estate before and they'd like someone's money. Not gonna end well.
I predict there will be criminal and SEC civil prosecutions of some of these syndicators. The combination of high interest and declining rents is going to cause some of their existing book to zero out.
passionate generalization
Wenatchee is a total under the radar home run market. Unless Melanie knows this market I would just take her comments like you said a big generalization.. I predict over the next 25 years that area will be a huge winner for RE .. I mean look at what happened in Bend Or. and Wenatchee has 5X the potential of Bend.. other than Bend has a better ski mountain.I'm right there with you. Milken Institute's 2024 TPC report came out and Wenatchee bumped up from rank 13 to 8 with a primary driving factor of broadening high speed internet to larger customer base at lower rates. Plus the obvious infrastructure investments, population and job growth.
- 2yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Karl Krauskopf:
Quote from @Jay Hinrichs:
Quote from @Karl Krauskopf:
Quote from @Melanie P.:
Quote from @Karl Krauskopf:
Quote from @Linda Mejia:
Currently raising for a multi fam project in seattle, WA.
Bold - not many others operate here. Happy to learn more
Bold? I'd use the word "telling." When someone operates by pitching an investment on here it tells me that they have no compliance department, no legal, no offering documents, no care to evaluate the suitability of potential investors, no disclosures, no financials, are not registered and so on. They have a story, they might have done something in real estate before and they'd like someone's money. Not gonna end well.
I predict there will be criminal and SEC civil prosecutions of some of these syndicators. The combination of high interest and declining rents is going to cause some of their existing book to zero out.
passionate generalization
Wenatchee is a total under the radar home run market. Unless Melanie knows this market I would just take her comments like you said a big generalization.. I predict over the next 25 years that area will be a huge winner for RE .. I mean look at what happened in Bend Or. and Wenatchee has 5X the potential of Bend.. other than Bend has a better ski mountain.I'm right there with you. Milken Institute's 2024 TPC report came out and Wenatchee bumped up from rank 13 to 8 with a primary driving factor of broadening high speed internet to larger customer base at lower rates. Plus the obvious infrastructure investments, population and job growth.
My Dad was born and raised there !! and my Grandfather had a hardware store in Chelan back in the day he provided pots pans and utensils for the workers at the Grand Coulee Dam. So I have a Bias of course but I believe its going to explode.. not as cold as Spokane , closer to Seattle Leavenworth , Lake Chelan and access up to Lake Okanagon and Kelowna.. I used to own a home in Kelowna that whole area from the W north on 97 to Kelowna and a little north of their is awesome. - 2yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Jay Hinrichs:
Quote from @Karl Krauskopf:
Quote from @Jay Hinrichs:
Quote from @Karl Krauskopf:
Quote from @Melanie P.:
Quote from @Karl Krauskopf:
Quote from @Linda Mejia:
Currently raising for a multi fam project in seattle, WA.
Bold - not many others operate here. Happy to learn more
Bold? I'd use the word "telling." When someone operates by pitching an investment on here it tells me that they have no compliance department, no legal, no offering documents, no care to evaluate the suitability of potential investors, no disclosures, no financials, are not registered and so on. They have a story, they might have done something in real estate before and they'd like someone's money. Not gonna end well.
I predict there will be criminal and SEC civil prosecutions of some of these syndicators. The combination of high interest and declining rents is going to cause some of their existing book to zero out.
passionate generalization
Wenatchee is a total under the radar home run market. Unless Melanie knows this market I would just take her comments like you said a big generalization.. I predict over the next 25 years that area will be a huge winner for RE .. I mean look at what happened in Bend Or. and Wenatchee has 5X the potential of Bend.. other than Bend has a better ski mountain.I'm right there with you. Milken Institute's 2024 TPC report came out and Wenatchee bumped up from rank 13 to 8 with a primary driving factor of broadening high speed internet to larger customer base at lower rates. Plus the obvious infrastructure investments, population and job growth.
My Dad was born and raised there !! and my Grandfather had a hardware store in Chelan back in the day he provided pots pans and utensils for the workers at the Grand Coulee Dam. So I have a Bias of course but I believe its going to explode.. not as cold as Spokane , closer to Seattle Leavenworth , Lake Chelan and access up to Lake Okanagon and Kelowna.. I used to own a home in Kelowna that whole area from the W north on 97 to Kelowna and a little north of their is awesome.
Karl, there is a book called " Into the Sage" great read for those that live in Seattle and invest in central WA..
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