All Forum Posts by: Bellman Tumasang

Let's say my property rent not NOI is $1m a year.

All tenants pay online using an online service or app etc. 

I have a property management company that I pay 10% so $100k.

As the property management company manages the property like the leases, finding tenants, repairs, maintenance etc do they collect the $1m paid to their bank account and I trust that they only take a $100k cut and pay me $900k or can I instruct them to set up the online service where all the rents are paid to me so I pocket the $1m then pay them $100k?

I want to start a private equity firm e.g. Blue Estate LLC and raise funds such as Blue Estate Equity Fund I LLC etc.

Do I set up Blue Estate LLC then start first syndication single apartment building such as 10 units in property LLC which i sell interests of to investors and pay management fees to Blue Estate LLC and pay profit splits such as 80/20 to myself and investors. 6% preferred return.

If you’ve syndicated deals can you please tell me exactly how you started, entity formation, first deals and details such as financing, income, expenses and investors, finding investors, finding deals, building a track record e.t.c.

Much appreciated thanks !!!

I want to start a private equity firm e.g. Blue Estate LLC and raise funds such as Blue Estate Equity Fund I LLC etc.

Do I set up Blue Estate LLC then start first syndication single apartment building such as 10 units in property LLC which i sell interests of to investors and pay management fees to Blue Estate LLC and pay profit splits such as 80/20 to myself and investors. 6% preferred return.

If you’ve syndicated deals can you please tell me exactly how you started, entity formation, first deals and details such as financing, income, expenses and investors, finding investors, finding deals, building a track record e.t.c.

Much appreciated thanks !!!

I want to start small then work my way up. 

Do you suggest that I syndicate smaller single deals first like 10 unit apartment building with investors then work my way up to forming and equity fund investing in 100 units +. When I invest in single deals so you suggest I form a property LLC which I sell interests to investors.

Could you please explain how I would set this up like an example structure please.

I am thinking about working in commercial real estate first. Do you suggest that I work as a commercial real estate broker at a brokerage firm to sell commercial properties and learn the game.

Let's say I want to get investors and syndicate a 10 unit apartment building. I create Blue Estate LLC ( manager managed by me ) and Blue Estate Equity Fund I LLC which holds title to the 10 unit apartment building ( manager managed by Blue Estate LLC )

Syndication fees are 1% asset management fee of total capital raised paid each your to Blue Estate LLC, 1% of purchase price paid to Blue Estate LLC and 1% of sale price paid to Blue Estate LLC. 70/30 profit split with 30% to me as an individual and 70% to investors. 6% preferred return.

The purchase price is $1m I put that $250k raised from investors. I finance $750k with an interest only loan with a 4.5% rate.

I rent each unit out for $1k so 10 * $1k = $10k * 12 = $120k and let's assume 50% goes to expenses so an NOI of $60k.

That's a 6% cap rate when I buy the building for $1m. Since the debt is $750k at a 4.5% rate interest only my annual debt service is $33.75k. My NOI of $60k - $33.75k = $26.25k then divided by the downpayment of $250k is a 10.5 Cash on cash return.

$250k * 0.06 = $15k and since I pay investors a 6% preferred return do I pay them first $15k then distribute the remainder $11.25k in a 70/30 ratio with an additional $7.875k going to investors and $3.375 going to me. And I repeat each year.

Your probably thinking why pay management fees to Blue Estate LLC instead of yourself. The reason why is because I want to start a big real estate private equity firm in the future. By setting it up like this I could say my firm has millions of dollars of AUM which could help with showing a track record and crowdfunding for future deals.

Could someone please explain legal fees, registering with the SEC, setting up a PPM etc.

Do you like my structure? Any suggestions?

Let's say I want to get investors and syndicate a 10 unit apartment building. I create Blue Estate LLC ( manager managed by me ) and Blue Estate Equity Fund I LLC which holds title to the 10 unit apartment building ( manager managed by Blue Estate LLC )

Syndication fees are 1% asset management fee of total capital raised paid each your to Blue Estate LLC, 1% of purchase price paid to Blue Estate LLC and 1% of sale price paid to Blue Estate LLC. 70/30 profit split with 30% to me as an individual and 70% to investors. 6% preferred return.

The purchase price is $1m I put that $250k raised from investors. I finance $750k with an interest only loan with a 4.5% rate. 

I rent each unit out for $1k so 10 * $1k = $10k * 12 = $120k and let's assume 50% goes to expenses so an NOI of $60k.

That's a 6% cap rate when I buy the building for $1m. Since the debt is $750k at a 4.5% rate interest only my annual debt service is $33.75k. My NOI of $60k - $33.75k = $26.25k then divided by the downpayment of $250k is a 10.5 Cash on cash return.

$250k * 0.06 = $15k and since I pay investors a 6% preferred return do I pay them first $15k then distribute the remainder $11.25k in a 70/30 ratio with an additional $7.875k going to investors and $3.375 going to me. And I repeat each year.

Your probably thinking why pay management fees to Blue Estate LLC instead of yourself. The reason why is because I want to start a big real estate private equity firm in the future. By setting it up like this I could say my firm has millions of dollars of AUM which could help with showing a track record and crowdfunding for future deals.

Could someone please explain legal fees, registering with the SEC, setting up a PPM etc.

Do you like my structure? Any suggestions?