Possible Syndication, Best Structure?

[Nate S.]

I am looking at putting together a syndication deal for a housing development outside of Lagos, Nigeria. I am thinking I would form a domestic, US LLC and raise capital for the deal through that LLC. The domestic LLC would become a member of the Special Purpose Vehicle entity that is formed in Nigeria.

It is going to be a fairly small raise, max $500k. Probably 8-10 investors @ $50k each. We are looking at working primarily with accredited investors, though there may be 1-2 sophisticated investors. Investors will primarily be from Virginia, but we could have 1-2 in other states.

I've talked with a couple of SEC attorneys and they both quoted around $7500 to do all of the paperwork. However, that amount starts to skew the returns down given the smaller raise.

Has anyone done something like this before? What is the best way to structure it? Do we need to do a full blown PPM or could we structure it another way to help keep it more simple and the costs down?

[Jeff Greenberg]

$7500 is pretty reasonable these days for a PPM.  I don't think that changing the structure one way or the other is going to change your costs for the PPM. If you have all accredited investors a full PPM is not required.

Get advice from an SEC attorney. Be safe.