Danielyn explains how real estate syndications pool investor money for larger deals. Her current 48-unit apartment project targets 12% blended returns: 6% paid quarterly, 6% accrued when you exit. Expect no distributions the first year while the property gets rehabbed and improved.
Questions this video answers
48-unit building.
12% blended return.
6% paid quarterly and 6% accrued and paid upon exit (refinance or sale).
Three to seven years.
$100,000 (context implies an example investment amount).
Hey everyone, Danielyn here with Freedom Family Investments. In this video, we're going to be talking to you about syndications. You'll love these if you are looking for tax benefits, so make sure you dig in, but stay on till the end because we're going to share with you some stories and experiences from real estate investors who have been working with us over the years so that we can share their experiences with you. Hey everyone, Danny Lynn here with Freedom Family Investments. And in this video, we're going to talk about syndication. First of all, what is a syndication? A syndication is when a group of investors will pool their money to be able to do a larger deal than they could do on their own. This could be in real estate, such as apartments, self storage, assisted living, industrial, it doesn't matter. It could be anything. It could also be private equity. So for businesses. So a syndication and funds, which is the video. I also recorded all of these. You'll review the ppm, which is the private placement memorandum, to see what the investment is that that particular syndication or fund is investing in. So how I'm going to talk about this one right now is actually for a 48 unit that we are actually currently raising for. But this video will serve as an educational video that will likely relate to any syndication that we do in the future. So now that you understand what a syndication is, we let's talk about this 48 unit that we have. So we created a syndication. We bought a 48 unit building. We actually closed on it a few months ago and we are just now finishing the raise for that particular investment. The rate of return is typically, at least on this one is 12% blended return. Okay. What that means is in this particular investment, you're going to receive 6% paid quarterly and then you're going to receive 6% accrued upon the exit of the deal. So that could be a refinance, that could be a sale. When you get the full 12% blended return, the length of time in syndications is typically three to seven years. $100,000 investment. The disbursements, it depends on the syndication. And the one that I'm talking to you about right now is year one, there's no disbursements because that's when all the rehab is happening. And so as the rehab is happening, we're cash flow poor. So a lot of units are vacant. We don't have that cash flow coming in. So we wait for year one and allow all the renovations and the value add to happen. Then in year.
