Frequently Asked Questions
Frequently Asked Questions
Investing in multifamily syndications can be a great way to passively grow your wealth, but it's essential to understand the process and potential risks involved. Below are some common questions from our investors. Please reach out if you have more questions that are not covered here.
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Investing in syndications carries risks. It's essential to consult with tax and legal professionals before investing, as these professionals can help you understand potential legal and tax implications.
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We accept Accredited Investors and may also consider Sophisticated Investors based on pre-existing relationships and SEC regulations. Accredited investors can also participate as key principals (KPs) or loan guarantors.
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Yes, you can invest with retirement funds through a self-directed account or Solo 401(k). Consult with us and your tax advisor to navigate unique tax consequences.
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You can invest through a trust, LLC, or corporation, whether with cash or self-directed retirement accounts.
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Syndication projects typically last 5 to 7 years, but it varies depending on the business plan.
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No, investments are generally illiquid for the duration of the project to achieve long-term financial goals.
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Distributions are typically made quarterly but may vary depending on the project. Distributions are not guaranteed and depend on project performance.
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Investors receive monthly reports with property updates, financials, and business plan progress.
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We typically work with U.S. investors, but exceptions may be made based on legal and regulatory considerations.
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ROI can vary but is generally projected between 13-18% internal rate of return (IRR) and 6-8% cash-on-cash (CoC) depending on the deal and market conditions.
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The Internal Rate of Return (IRR) is a metric used to measure the potential return on an investment over its holding period. It factors in the time value of money and considers both the timing and amount of cash flows, providing an annualized percentage that represents the average annual return an investor can expect.
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Cash on Cash Return is a measure of the return on an investment based on the cash flow generated from the property. It is calculated by dividing the annual pre-tax cash flow (income minus expenses) by the initial investment made by the investor. This metric provides an estimate of the cash return an investor can expect in a given year.
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Risk mitigation strategies include diversification across properties and markets, maintaining adequate reserves, and professional property management.
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Typically, investors exit through the sale of the property or refinancing, receiving their share of the proceeds.
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Yes, you can often choose to reinvest your distributions in other projects within our offerings.
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In such cases, the investor's estate or beneficiaries can usually continue to receive distributions or choose to exit the investment.
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Generally, syndication investments are passive, and you won't be involved in day-to-day management.
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We maintain insurance to cover property, liability, and potential natural disasters.
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We provide regular updates through monthly reports and may hold periodic investor calls or webinars.
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Our sponsors typically have a financial stake in the project, aligning their interests with investors.
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The lead team in charge of the syndication hires a professional property management company with expertise, qualifications, and a strong track record. Self-managing is typically avoided due to the complexity and potential risks involved in property management.
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It's strongly recommended to consult with legal or tax advisors before making an investment in multifamily syndications. These professionals can provide guidance on the legal and tax implications specific to your situation and help you make informed decisions.