Syndication Investing During a Recession

[William Costello]

In your opinion, how has syndication investing changed during Covid times? 

[Danté Belmonte]

From what I am seeing on the acquisition side of syndications, CAP rates have compressed even lower causing apartment values to increase. The shortage of lumber and building materials is causing new development prices to increase which directly increases the value of existing multi-family.

As far as operations go, collections are lower but increasing monthly. Some Syndicators have put distributions on hold for a month or maybe a quarter to make sure they have adequate reserves incase things were to get worse (which I agree with). Doing that is smart and is what a skilled asset manager/operator would do.

All in all syndications are still strong and I will continue to push investors to them and we will continue to buy apartment complexes.