What is Real Estate Syndication and How Does Work?

Real estate syndication is an investment method that allows investors to pool their money and share in potentially massive profits.

What is Real Estate Syndication

Real estate syndication is when a group of investors comes together to pool money and efforts in order to invest in real estate.

How Does Real Estate Syndication Work?

Usually, real estate syndication deals are structured as a limited liability company or a limited partnership. The sponsors act as the general partners (or GPs) and the investors are limited partners (or LPs).

Real Estate Syndication Statistics

– From 2009 – 2012, over $63 billion was raised for private real estate investing. – The average real estate selling price in the same period was aroun $15 million. – The average preferred return is 8.5%, with 5% being low and 12% being high.

Why Real Estate Syndication?

For one, a real estate syndication lets you have focused access to a group of investments.

What Are the Requirements?

Prior to the JOBS act of 2012, you needed to be very wealthy to even consider real estate syndication. In fact, even if you were rich, you also needed to know someone who would let you in on the deal to invest.

Pros of Real Estate Syndication

- Diversification of your portfolio - Some guarantees - Experience - Tax advantages - Synergy

Cons of Real Estate Syndication

- Potential lack of control - Lack of liquidity - Volatility in the market

Swipe up now to read the full post!