All Forum Posts by: Steven Rosenfeld

Bruce - thx very much for your feedback. My philosophy is similar to yours in that I prefer the GP to be local to the area they are investing in and have boots on the ground on an ongoing basis. Seems in the syndication world there are capital management companies that find the deals, do the marketing, and collect the capital, and then they partner with local operators that they may never have worked with before. The first syndicator I invested with was BAM Capital as they seemed to have a geographical base in the Indianapolis area. I'm looking for other syndicators similar to this but in the southeast. If you know of any I would greatly appreciate your input.

Anybody have experience as an LP with Penn Capital? They are marketing a new deal in North Carolina on FB. I'm interested in that region but know nothing of Penn Capital. Thx for your input!

Anybody have experience as an LP with Penn Capital? They are marketing a new deal in North Carolina on FB. I'm interested in that region but know nothing of Penn Capital. Thx for your input!

Thx Adrienne for the transparency. Sounds like the Goodegg got out over their skis but no doubt many other sponsors did as well. May I ask which BAM fund stopped paying out on B shares? I'm in Fund III and the structure on their B shares is that they don't pay out until capital event (I thought).

Jessie - Would be great to learn some of the better ways to invest passively. Would you be willing to share?

I’m in one syndication right now and looking for the next one … carefully!

So we all know the story by now that high interest rates and slowed rent growth have made it very difficult for sponsors to put together attractive multi-family deals on existing properties. The value-add or operational efficiency models are not necessarily strong enough to counter the headwinds. So, I'm seeing a few syndicators like BAM Capital getting into new builds and wondering how these will play out for us LPs. 

 Here are some questions that come to mind:

- Are construction costs are getting more manageable now that COVID supply chain issues are getting smoothed out? 

- Cost of capital is still going to be high, but held for a shorter period, as a construction loan. So does this reduce interest rate risk?

- When the time comes to recapitalize (sell or refi) in a few years, will sustained higher interest rates significantly impact the profitability of the deal?

What do you guys think? Time to pivot to new builds, switch to another asset class, or stay on the sidelines?

So I follow the news and listen to the BP podcasts and the signs are clearly flashing danger for MF syndications - high interest rates and short-term debt coming due, constrained bank lending, slowdown in rent increases and tons of new projects coming online to soak up demand. Cap rates still heading up and getting more difficult to grow NOI. Valuations going down.

But - I am still getting inundated with 503c offerings still telling me I'm going to get that 15% IRR and 2.5X multiple in 5 years.

Is investing in MF syndications the foolishest thing to do right now? Is a massive collapse on the horizon or is this just a cooling down period? If the cap rates peak out in the next year or so wouldn’t it make sense to invest in fresh deals at that time that can take advantage of the higher cap rates? 

Please convince me one way or the other ? Is love to hear what the BP community is doing in this space right now.

Edna - So far my experience with BAM has been good. I've gotten my distributions on time, got my K-1, and no capital calls yet. Its still uncertain as to how well BAM will handle the current environment with higher interest rates and slowdown in rent growth.