How to find a sponsor?

Question

How does one find a sponsor for a new investor seeking to invest in multi-family properties?Is there a process to this? Where can one go?

Chris Tracy · Answer

@EVAN MCMULLIN

Do you need a sponsor?  I can bring one to the table for you.  Let's talk!

Chris Winterhalter · Answer

Evan McMullin

I'm sorry I misunderstood your first post.  I thought you were looking to invest in a project through a sponsor/syndicator.

When you state you are newer to multi-family but have done residential real estate what do you mean?  Multi-family is residential, or do you mean 5+ unit multi-families?  Or do you mean you've only invested in single family homes?

It's best to invest in smaller multi-family projects to learn the operational and transaction side of the business before jumping into syndicating your own deal.  Even if you are a high new worth individual with 1-2MM+ to put into a project I would still recommend investing in your own project before pooling funds together.

There are plenty of books on the subject and seminars and conferences that can be attended.  However those generally speak to the logistics and framework of syndicating a deal not the actual real estate investment & operational competent.  Those should be mastered before funds are raised (in my opinion).

Chris Winterhalter · Answer

Evan McMullin

I'm guessing you would prefer to invest in a deal locally?  Do you have a preference in existing or new construction?  I would start here...

-Identify the top 10 multi-family property management companies in your market.  They will likely sponsor deals on a regular basis (not all).  If they have a solid track record in the market then that's a good first step.  They will probably have someone on payroll that deals with fundraising.  Talk to them and get a feel for the process.

-Top CRE brokers can also syndicate deals.  They will also likely know the successful syndicators in the marketplace.  Reach out to these folks.

-Lenders for commercial properties (specifically institutional funds, CMBS, Life Insurance Lenders, & Fannie/Freddie Multi programs).

-Apartment developers that you recognize doing deals in your area.

-Potentially crowd funding sites

Good luck!

Eric Tait · Answer

You will need to find a mentor or go to a syndication training class.

Evan McMullin · Answer

Okay, so if I am newer to Multi-family RE (I have done a lot of residential RE), and I want to be the person finding the deal, crunching the numbers, person on the ground who hustles.... How do I put together my "team" and how do I explain my role?

Chris Winterhalter · Answer

Evan McMullin

There are many BP topics and a lot of literature on the subject.

The sponsor/syndicator is the person putting together the development & the funds.  His/her role can vary greatly however they are generally the person with expertise on the deal, putting together all the framework, sites, deals, financing, legal, etc.  If you are looking to invest in private placements on the passive side you would find a successful sponsor, and many times that translates into a successful operator/contractor/developer/broker of some sort.

Denise Stanford · Answer

Your "team" should consist of an Real Estate Broker, Attorney, Accountant to start....who understand investors.  I would discuss with them your overall goals and transactional strategy.  This makes their involvement on your team clear and helps to define your role as well.  Often time through team building mentoring relationships are found.

Evan McMullin · Answer

How does "syndication" work exactly? Is the syndicator the party or parties who have essentially coordinated the money side of things?

Raechelle Carroll · Answer

@EVAN MCMULLIN  What do you mean by sponsor?

How to find a sponsor?

Most Popular Reply

@EVAN MCMULLIN