12% cap, great location, quality tenants and buildings - vs. Opportunity. Advice Needed!

[Eric Amzalag]

In response to Khary Reynolds post about http://www.biggerpockets.com/renewsblog/2010/08/30/real-estate-syndication-3-ways-you-can-profit/ Real Estate Syndication.

In response to a comment by Jeff Brown, "I think if you’re able to find superbly high quality buildings, with golden tenants, in equal quality locations at cap rates of 12%, you’ll have no problem whatsoever of finding investors"

My Response: I do find myself w/ another dilemma...

Mind you, I am only 21 so things can change, but I do have a great job + opportunity to work at the highest volume Commercial RE brokerage in my ~120k population college town + surrounding city. My boss wants me to commit to 3 years after graduation (2011-2014). Here's my dilemma - the cap rates in my city average 5% because of zoning restrictions that do not allow ANY new buildout whatsoever. There is no geographic (space) city expansion. As such, property values don't fluctuate as widely as other areas (supply is limited, demand grows) but because there is less risk, the cap on buildings does not get as high as in other areas. My goal has always been to learn through brokerage and PM while building an investor group and then to syndicate RE deals starting as soon as is possible.

Knowing that the cap in my town will VERY rarely go above a 5-8% range, do you think it will be difficult/nigh on impossible to find investors?

Do you think that this city will be a "bubble" (That whatever progress I make building an investor group and learning brokerage and PM will not translate to a bigger city because of this cities unique RE characteristics)?

Do you think staying in this smallish city to gain experience at this high volume CRE brokerage is inconsistent w/ my goal of syndicating deals?

This comment can also be found slightly more understandable b/c of context over at Khary's blog post about RE Syndication here: http://www.biggerpockets.com/renewsblog/2010/08/30/real-estate-syndication-3-ways-you-can-profit/

Thanks for the responses guys!
Eric