Cash-Flow Income in Real Estate Syndications as a Limited Partner or Passive Investor, Part 1

You know, for anyone out there that's thinking about, you know, becoming an lp, those are things to look at. You know, even though it is, let's call it a three to ten year hold, you're de risking the deal very quickly because you're getting credit from a pref piece on the construction portion. You're getting some distribution or two before the refinance period. So you probably get 10% cash on cash in year one. Then you're getting another big hit on the refi proceeds and then you're going to be cash flowing from there moving forward before the sale. And as Wayne mentioned, you're getting a huge bump on the refi and those are tax free proceeds. But one other thing that I think is mentioning is that we do, and a lot of larger developers do what is called a cost segregation analysis. And what that means is instead of depreciating the building on a straight line basis over 27 and a half years, we do a study that says, hey, the doors are actually going to depreciate much quicker than the bricks. You know, the carpet in the bedroom is going to depreciate much quicker, you know, than some of the mechanical systems. And you push a lot of the depreciation into the first few years of operations of the building and you can actually show a large tax shelter on that depreciation in the first one to three years. Yeah.