Real Estate Syndication Historical Return

[Michael Bard]

Im taking a Property Quant Class to analyze real estate. As a capstone project I would like to analyze multifamily returns. Given that most of these are private not sure where to look to see what data is available to analyze, but any ideas where i can hunt down historical multifamily / real estate syndication historical returns?

Any help you could provide pointing me in the right direction would be much appreciated.

[Arn Cenedella]

@Michael Bard

Great question.

As @Paul Shannon mentioned, syndication deals became commonplace about 10 years ago. Of course until Covid, this was a decade of unprecedented growth and economic expansion and syndication returns benefited from this strength and growth.

I am involved in 10 MF syndications at the present time, some as an LP some as a GP. There are much more experienced MF operators and investors on BP than I and I will be interesting to see what their response is to your question.
Just to get the conversation started, here are my thoughts on some “ball park” returns on MF syndications - let’s say light value add deals.
Light value add syndications that were started in 2015 probably returned LPs somewhere in the neighborhood 17% to 18% IRR. I know we will see responses that say, I got 30% IRR on my deal and while that may be true in certain instances, I suspect my guesstimate of 17% to 18% is probably closer to the norm.

I believe the next decade will not be quite as robust as the prior decade. The CEO of Realty Mogul recently gave talk where she indicated for a "down the fairway value add deal - $5,000 a unit renovation expense, LP investors should expect and be satisfied with a 12% to 14% IRR. I agree with this assessment .

I will be interested to see what your research reveals.

Please post when complete.

Thanks!