How to find reputable Syndication firms

Question

I am an accredited investor looking to make some passive investments in value-add multi-family real estate deals.   How do I go about finding reputable/competent firms?

In my current career, I have some involvement in the process (valuation and assessment, particularly for Agency loans), so I have some basic familiarity with the process. I can't have any financial dealings with those that contract with us for valuation and assessments, so learning more about those particular firms wouldn't be much help.

A Google search turns up some names (Cadre, RealtyMogul, Crowdstreet, etc.), but without any objective information, it is hard to evaluate which companies are solid performers.  Some companies tout great returns but appear to be fairly new to the business and they don't have any experience in down markets or a rising interest rate environment.

Is there a forum that addresses this?  Or are there other investor groups I could join in order to obtain leads on deals?

Thanks!!

Paul Moore · Answer

Hi @R Durney! You got some great advice above and I also recommend @Brian Burke's book, as well as getting involved with LeftField Investors group. They are a powerful community of passive investors and I think it would really benefit you.

Another group you might want to look at is Ian Ippolito's Private Investor Club with The Real Estate Crowdfunding Review. The Private Investor club is designed with someone like you in mind. Ian had the same frustration when he started planning to invest in private syndications. He put this forum together to help investors to review opportunities. I think you will benefit from that as well.

Please reach out if I can help and good luck!

Nathaniel Winkel · Answer

@R Durney I am at a similar phase, ie researching syndicators.  Networking is the short answer, getting on here is a good start.  I would also recommend reading 'The Hands-Off Investor by Brian Burke' as a good resource for how to evaluate syndicators.

Griffin Brand · Answer

@R Durney, you've got some great advice above. As you're looking through the options, be thinking about what you are looking for from a diversification stand point. Some sponsors invest in a single apartment complex, while others invest in a fund/portfolio of apartment complexes in a specific geographic region. These can both be great options. Still others, however, invest in several different asset classes across the entire country to create a fully diversified fund.

@Jim Pfeifer's group, Left Field Investors, is one great resource for information and other highly experienced investors. Best of luck!

Lane Kawaoka · Answer

Find a community of purely passive investors and go deep

Brock Mogensen · Answer

The best way to connect with syndicators is through referrals. Tons of syndicators here on BP.  I suggest connecting with at least five different syndicators.  Set up calls with them, diagnose their experience/approach.  Get on their email list.  Review the content and deals they send.  Invest with the one you like the best, and has the best deal.

Andrew Hogan · Answer

Hi @R Durney, there are a lot of other threads that go over this. Keep in mind that you are underwriting the sponsor / team / track record first, and specific deals second. (or search for a good Jockey before you look at horses)Many groups are just capital aggregators (not saying they are all bad), but many investors prefer groups that are vertically integrated and have in-house management in order to maintain control over their own deals.Happy hunting!

Brian Adams · Answer

@R Durney, last year I bought a 1,000 unit apartment complex and raised $40 million in a month.

I sent you a message and look forward to connecting with you.

Ronald Rohde · Answer

Those names you listed are just marketplaces, I assume you're looking for actual sponsors and operators. If someone is too new, just keep looking. The general problem is that as syndicators are more successful, the less they have to advertise (e.g. people who have been around 10+ years).

Just keep joining email lists, they do lots of cross promotion, attend local REI events and let people know!

I can recommend a few if you share your criteria.

John Mazzella · Answer

@R Durney You can find some good syndicators by looking through the forums on BiggerPockets. This post will likely bring some syndicators right to you. It's a good idea to speak with multiple syndicators and find one who you can really trust and your values align. Some questions I would think about are:

Where do you invest?

How many deals have you done?

Have you taken a deal full cycle before?

How long do I keep my money in the deal?

Can you walk me through the return structure of a deal?

Can you provide me with a few investor references?

How to find reputable Syndication firms

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