Real estate syndication needs two things: enough capital reserves to survive downturns without forced sales, and working capital for operations. Low-interest, non-recourse loans from partner banks can flip equity deals into cash-flow-positive investments.
Most real estate deals will eventually work out, but you need the long-term staying power sometimes to subsidize losses over a period of time so that you don't end up losing the property, selling it at a loss, losing it to foreclosure. So we go into a property, you know, we go in with sufficient working capital and sufficient ability to gain capital if needed. The other thing about on the equity side, when we do these equity deals, is low interest rate, non-recourse loans from one of 2 banks that we work with. So, you know, that alone will usually make a cash flow positive situation.
