How to setup a syndication/fund-compliance, etc

[Josh Haney]

All,

I have recently been looking at syndications and fund structures, and was wondering if anyone could lead me in the right direction of setting these up? I am interested in learning a high level view of what these look like from an org structure standpoint, as I understand the gist of the business strategy in general. Some questions I have would be general LLC/LP structure as well as any licensing and credentials that sponsors/fund managers would need. I understand that there are some requirements aren't a legal necessity to obtain, but would look better for future LPs. Can anyone steer me in the right direction?

Thanks..

[Stuart Udis]

@Josh Haney I believe the legal/compliance piece is fairly well covered by those who already commented I completely agree that it's important to retain legal counsel to assist with drafting and also loop in an accountant to confirm structure is arranged with tax efficiency in mind.  Some investment strategies don't offer such luxury but worth spending a little money up front confirming as that's something your LP's will ask or want to know has been thoroughly researched.  

I want to focus more on your comment concerning what licensing and credentials are needed. The short answer is there are none. At the same time, that shouldn't be interpreted as anyone should go ahead and start a syndication if they have some money to get the syndication off the ground and relationships who will throw money at them. It usually ends bad for all involved including the GP. I've posted this before, but a GP should be able to articulate to LP's a competitive edge. Why you are better than other sponsors and the advantage you bring to the real estate transaction. If you are unable to answer this yet, you are not ready to GP a syndication. 

I recalled from an earlier post you asked whether having a real estate sales license would offer credibility for syndications. I am merely using this to illustrate my point above because that's not something I would consider a competitive edge since it's a low barrier license. Take inventory of your skillset and determine which strength will allow you to execute on projects in a way others are unable. That's what a good GP should be able to offer and if it's not something you are ready to provide, keep working on honing your skills before you take other people's money. In the interim continue to build your LP investor base and keep them informed of your real estate endeavors and growth.