5 Ways You Can Manage Real Estate Syndication Deals & Make Money
Real estate syndication management is an instrumental way to get more capital to fund your deals and grow your business faster. It benefits both buyer and seller, as it typically leads to both parties achieving their desired result.
Real estate syndication management can help sellers achieve greater property exposure and build a strong network of potential buyers. However, many fund managers find it challenging to enter these deals as they involve many moving parts and require expertise in structuring, finance, and deal execution.
In this PDF, we have encased & discussed five key ways you can manage real estate syndication deals and make money.
1. Be Sure to Understand the Fundamentals
Before investing in a deal, it is crucial to understand the target asset type and geography, investment type and structure, exit strategy, deal size, and construction timeline.
The asset type and location play a huge role in determining the kind of investor interested in the deal. The investment type, such as debt or equity, and structure, such as REIT or joint venture, determines the type of investor that will have interest in the deal.
2. Assess Market & Target Deal Types
The first step in entering the syndication market is identifying the type of deals you want to target. Generally, real estate syndication deals are categorized into debt and equity investments. In addition to these investment types, fund managers also target different asset types, such as hotels or residential mortgages and geographies.
3. Research and Analyze Deal Opportunities
Once you have identified the type of deals you want to target, you can start researching and analyzing deal opportunities. You can regularly check news websites and scan the internet for potential deals. You can also reach out to brokers to access a wide variety of deals.
4. Maintain the Due Diligence
The next step in managing real estate syndication deals is conducting due diligence. When considering a deal, the first step is to define the investment criteria, such as asset type, geography, and the dollar amount you want to commit to each agreement.
You need to work closely with the fund manager and other syndication investors, so it is important to understand the various risks and deal terms associated with each deal.
5. Identify Exit strategies
In managing real estate syndication deals, identifying exit strategies is required. Generally, there are two ways to exit a real estate syndication deal: sell your shares or the underlying property. You can also exit the deal by taking out a loan against your share of the property, known as a real estate loan syndication deal.
