What is a Syndication?
A syndication is when Investors pool money together to cover the purchase price/down payment, or renovation costs of the specific property.
How Does it work?
Once the property is purchased the syndicator/operator executes their business plan to increase the overall value of the property which includes improvements in operations and the building itself. Some examples of this include adding new facilities like gyms, pet centers, new signage, covered parking, fixing up exteriors, and renovating the interiors of each unit (paint, flooring, granite countertops, stainless steel appliances etc. In doing this the operator can increase the rents per unit which increase the overall value of the property.
What happens when they sell or refinance?
Once the business plan has been executed the operator can sell the property for a significant gain or refinance the property to pull out a portion of the investor’s original investment. Regardless of the exit plan, the investors share in the gains that were generated through the business plan.
How long until I get my Return?
Typically, the hold period can be anywhere from 2-5 years depending on how the deal is structured. Some deals can be 5-10 years.
Optimal Equity Group is a real estate investment firm that partners with experienced operators that acquire assets in emerging markets, primarily focusing on value add apartments. We are keen on educating passive investors to make informed decisions about safeguarding their financial future through alternate investments.
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