All Forum Posts by: Philippe Schulligen

Here is a blog article that I have just posted that attempts to answer the question Guide to Find the Best Investment Option for You

I hope it helps!

Here are the 5 top reasons to consider commercial multifamily:

Economy of Scale

Single family properties or small multifamily properties do not have sufficient revenue to hire full time staff. Because of this, owners are typically required to handle all day to day operations of the property. With a multifamily, revenue is sufficient to hire full time staff to operate the property.

Cost of property management, repair materials, service contracts benefit the economy of scale.

Risk Reduction

Thanks to the multiple units in a multifamily property, laws of average for vacancy and maintenance costs apply. An Investor in single family homes will need many units to apply laws of average on his portfolio: a bad tenant can result in burning up all profits made in a year.

Tax benefit

Contrary to a single family rental property, the depreciation on a multifamily asset can be accelerated thanks to a cost segregation analysis.

Appreciation

Unlike a single family value tied to comps, themselves linked to market conditions, the value of a multifamily asset is based on the Net Operating Income (NOI) - income minus expenses - and the Capitalization Rate of the market. There are three ways to force appreciation by increasing the NOI: increase income, decrease expenses, or a combination of both.

Workload

Finding the deal, underwriting, negotiating, closing and managing. Those are the tasks that must be repeated for each acquisition of a real estate asset. While less complex, single family properties must have to be repeated for each door. A single multifamily acquisition allows one to run a more intense process once to acquire 5, 10, 100... 1000 doors!

Here are the top 5 reasons to consider passive investing in syndications:

Passive

Possibly the most beneficial reason to consider investing in real estate syndications is that you have the ability to be a passive investor. The sponsor will find the deal, negotiate, underwrite (create a business plan), find financing, close the transaction. Then the investor is letting the sponsor manage the asset or take care of the operational perspective of the investment.

Experience

A syndication allows you to take advantage of the experience and financial strength of the sponsor. The sponsor brings a track record and a network of 3rd parties to inspect, finance, provide legal support and manage properties.

Access to Large Investment

A syndication allows the aggregate of capital among other investors to invest in otherwise unobtainable, high-value apartments with high returns. Over 90% of multifamily purchases are made through syndication.

Diversify

Investment in a syndication typically start at $50,000 and could be as little as $25,000. The relatively modest investment in a particular syndication allows you to access several markets when investing in multiple deals.

Protection

Each syndication purchases the multifamily asset through a Limited Liability Company. An LLC provides its members with personal legal protections against lawsuits and personal financial liability. Consult with your attorney for specific advice on the benefits of investing through a syndication.

Inspiring thread! Here are my goals for 2020:

• Continue to gain experience from other successful operators by attending mastermind groups and conferences.
• Write articles or blog posts to share my experience. (started on BP few weeks ago: The Multifamily Investor)
• Co-sponsor 2 to 4 commercial multifamily syndication deals.

Inspiring thread! Here are my goals for 2020:

• Continue to gain experience from other successful operators by attending mastermind groups and conferences.
• Write articles or blog posts to share my experience. (started on BP few weeks ago: The Multifamily Investor)
• Co-sponsor 2 to 4 commercial multifamily syndication deals.

Inspiring thread! Here are my goals for 2020: 

• Continue to gain experience from other successful operators by attending mastermind groups and conferences.
• Write articles or blog posts to share my experience. (started on BP few weeks ago: The Multifamily Investor)
• Co-sponsor 2 to 4 commercial multifamily syndication deals.

Here are a list of topics to cover in multifamily syndication deal presentation you may find helpful: Multifamily Business Plan 101 (blog post I have published recently)

Here is a blog post I have just published about multifamily syndication deal business plan writing you may find helpful: Multifamily Business Plan 101

Here is a blog post I have just published about multifamily syndication deal business plan writing you may find helpful: Multifamily Business Plan 101

Hi @John Lesovsky

Here is a blog post I have just published about multifamily syndication deal business plan writing you may find helpful: Multifamily Business Plan 101

Hi Grant,

A bit of context might help...

Could you please elaborate on why you do not want investors to be guarantors?

Also is the loan type recourse or non-recourse, short term bridge or long term financing and what size loan you look for?