All Forum Posts by: Theo Hicks

Seller financing is one. Lease option is another.

As @Daniel Dietz said, they need to be a partner in order to qualify as a JV and not a syndication.

It isn't a requirement to have money, but it is ideal to invest money into your own deals to create alignment of interests. As an investor, would you invest with someone who has no skin in the game?

Should be the cash flow. But follow @Alina Trigub's advice.

The best way to vet the operator is to speak with them. Phone call is the easiest but I know some passive investors actually fly out and meet the sponsor in person. The purpose is to gauge their character.

Another way to gauge their character is to speak with people who are currently investing in their deals.

Hi @Hardik Patel,

The syndicator should let the investors know the projected hold period. Generally, the only reason (from the investor's perspective) to sell early is if they can achieve or exceed the projected IRR early. Of course, a bad reason to sell early is if the deal is performing poorly and he syndicator wants to preserve as much capital as possible.

I would check out Holly Williams on BP. She was able to quit her job exclusively through passive investing.

I would invest with an experienced apartment syndicator whom I've asked what measures they've put in place to reduce the deals risk should a housing crash occur during the business plan.

@Dyryl Burnett Check out syndication school. Also, I recommend browsing the forums, as questions about structuring deals with passive investors have been asked hundreds of times, so you'll likely find the answers to your questions (as well as find questions you didn't even think to ask).

@Timothy VanWingerden Thanks for the background. I agree with @Amy Wan. The risks associated with this business are likely different than the risks associated with real estate. So the compensation needs to be adjusted based on that.