Returns with syndication

[Rafael Esteves]

Hey friends,

I am wondering how large syndicated properties make the profit they do. In deals supplemented by a bank loan, many investors look for a 10% return or more; however, this return is only possible because they are financing 80% of the property with a fixed low interest rate loan. 

In syndication deals, many LPs are guaranteed between a 5 and 10% return and the GPs are still able to make money. This means that on these large deals there would need to be a high return without utilizing any leverage. How is this possible? Is the markets for commercial properties just that profitable or am I misunderstanding something?

Thanks