Looking for tips in syndication deals

[Anwar Abdul-Hadi]

Learning about investing in syndication deals and would love to hear your stories, along with any tips or guidance you may want to share. Thank you all in advance.

[Ian Ippolito]

@Anwar Abdul-Hadi,  I also invest in syndications/crowdfunding and go though hundreds of deals a month. 

The very best book for a beginner (and pros) is “Investing in private equity real estate”. It will save you tens of thousands of dollars in mistakes at a minimum and is a must read. https://www.amazon.com/Investing-Real-Estate-Private-Equity-ebook/dp/B01IW0G0S0

 Here are my tips for investing in syndications /Crowdfunding: 

1)  you are going to be flooded with opportunities. First make sure that you figure out what percent of your portfolio will be allocated to different strategies (debt versus equity, commercial versus residential, core vs core+ vs value added vs opportunistic, etc.).  This requires understanding the risk/reward trade-offs, and then coming up with a plan and sticking with it.  if you don’t, you will end up with an unbalanced portfolio that is much riskier than necessary. 

2)  when you get a new deal, analyze the quality of the sponsor first.   A great sponsor can make an OK looking deal turn out great, and a bad sponsor can make a great looking deal turn out bad.  Look specifically for experience in the exact strategy of the deal. 

3)  if the sponsor is good, then start drilling into the deal.  Look at pro forma‘s, do a recession stress test, Google the heck out of the company and the principals, etc.  Check out the legal documents for gotchyas. 

I do all of the above and much more then could fit in a post. If you want more details, PM me.