Syndication Recommendations for Passive Losses

[Jeff Goldenberg]

Hi All,

In anticipation of bonus depreciation returning to 100% as part of the new tax bill, can anyone recommend a syndication they have experience with that creates paper losses with some moderate cash flow? I have experience with Sunrise Capital Partners and PPR Capital, but am looking to invest in a few more funds to avoid concentrating too much capital in one fund. Ideally, the fund would generate a large non-cash loss the first year due to depreciation paired with an 8%+ preferred return. 

[Chris Seveney]

Quote from @Basit Siddiqi:

I would prioritize the sponsor performance(life of the fund) and experience over cash-flow and depreciation.

I would also look to zoom down on the asset class along wtih the region you want to invest in to then determine the fund sponsor you want to go with.
Asset class - residential real estate, commercial real estate, data centers, mobile home park, etc
region - north east, south, west, etc

Then when you decide on a few sponsors, have a call with their investor relations team to see if the sponsor will decide on getting a cost segregation study.

Bes tof luck!

Agree 10,000% on this. I am parts of groups where people invested in coffee, oil and gas, ATM machines etc. because they were chasing the depreciation components (especially back when there was 100% depreciation), they got all that depreciation but in some instances the funds took a turn for the worse and not only did they lose their investment they also owed money due back to the IRS for depreciation recapture where they took too much depreciation.