What You’ve Always Wanted To Know About The Investors In Real Estate Syndications

In this article, get to know the investors in real estate syndications. Real estate syndications are a group where investors can pool their funds to buy a large commercial asset. However, they can feel lonely sometimes. Even when you are working alongside tens or even hundreds of other investors, you may never interact with them personally. You might not even know their names (mainly for security or privacy reasons).

All communication is typically handled by the sponsor team or through the owner and founder of the syndication. An example of an owner and founder would be Ohana Investment Partners. So, you might be curious about the other investors who you are working with. You might want to get in touch with their backgrounds, origins, and decision-making processes.

At Ohana Investment Partners, we want to provide insight to you about other investors that you might be curious about such as:

  • What is a limited investor?
  • What makes a limited partner investor “limited”?
  • How many passive investors are there in a real estate syndication?
  • Who are the investors in a real estate syndication?
  • How can I meet and talk to other passive investors?

 

What is a Limited Partner Investor (LP)?

Limited Partner Investors are people like you and me who invest in real estate in a real estate syndication. Real estate syndications allow you to invest without the hassle of being a landlord. The focus of limited partner investors is to help provide the capital needed in exchange for a return. However, they are not involved with the day-to-day decisions.

The most important part of a syndication is the passive, limited partner investors and the money that they put into a project. Without limited partners, deals do not get done. Period.

When you are part of a syndication, you are part of a community. This is true even if you are doing research or paperwork on your own. If you know anything about me, you already know the value I place on community. Through the timeframe of the project, LPs funds are combined to enhance an asset, the neighborhood around it and to generate income for their own households.

 

What makes a Limited Liability Partner “Limited”?

The “Limited” in “Limited Partner Investors” refers to investors who have limited liability for the project. There are general partners and limited partners in a syndication. Limited partners invest capital and they are not actively involved in the decision making, property management or the asset management. Additionally, they are not held liable if something goes wrong. On the other hand, general partners carry the majority of the risk and active responsibility.”Limited” refers to the obligation that is at risk and has nothing to do with expected profits.

Offerings are often set up so that the general partners obtain a minority stake (at least until a certain point. On the other hand, limited partners may earn 70% to 80% in returns, depending on the offering. Limited partners often receive payments sooner than the GPs. Bear in mind, this is another way that your investment is protected and a way to ensure that everyone has the same goal. Understandably, your sponsor team is not going to want to work for free.If they do no get paid until you get paid. Thus, there is a higher incentive to get the asset to perform and perform well.

 

How Many Passive Investors Are There In A Real Estate Syndication?

when it comes to real estate syndications, the number of investors in it varies based on a variety of factors. For instance, it could be capital that is required for closing as well as the amount of investments made by investors. Some investors invest the minimum that is required, and others participate using higher amounts. The amount of capital that is required for closing can vary greatly and depends on the assets within the syndication, the amount of debt on the asset, and the capital expenditures planned.

 

Who Are The Investors In A Real Estate Syndication?

At Ohana Investment Partners, we operate with the come one, come all and come as you are mentality. This gives me the pleasure of working with investors from all walks of life in various seasons of life.

The truth is, almost anyone can participate in real estate investing, especially passive real estate investing. It is it one of the best forms of investing we provide. We encourage anyone to become a real estate investor – regardless of it they have family money or using their own capital that they have built up over the years. We’ve worked with investors ranging from recent college graduates to highly experienced investors.

Certain investors like to take on a more passive role because they’ve previously owned rental properties or have flipped properties before. They may be looking to diversify or take a break from such an active role. Others might not have ever owned any other real estate and are simply looking for another income stream or a way to take control of their retirement.

The one thing most investors DO have in common is that they are looking to grow their wealth and believe in the benefits of real estate and know the wealth it can help create.

 

How Can I Meet And Talk To Other Passive Investors?

If you are working with me, you know I love the community! Because of this, I host events and webinars regularly. My goal is for you to meet and interact with other investors. If you are local to Orlando, I host an investor networking event with light education at least once per quarter. I also host a general women’s meet-up quarterly.

If you are not in Central Florida, you are welcome to join us for our virtual events and webinars where you have the opportunity to interact with others. As always, if you are looking to connect with other investors, just let me know and I can put you in touch with some (as soon as they give me permission to connect you both).

The power of community is something we, at Ohana Investment Partners, are extremely conscious of. We urge you to read more about investing in real estate syndications, listen to podcasts, research the subject more, and get in touch with others who have done the same.

You never know, one day you may be the experienced investor speaking to a new or prospective investor on the other end of the line. We all have to start somewhere.

 

In Conclusion

I hope you have a better understanding of the different types of investors within a syndication. They are regular people, like you and me, who are attempting to learn more about passive real estate investing, grow their wealth, and take charge of their future, all while their children, boss or staff, may be calling out from another room or office.

Additionally, there are non-investors who also don’t love the complex legalese in private placement memorandum (who does?!). They are regular people who also anxiously send their first investment and check the wiring instructions multiple times to make sure everything goes through.

They are also the people who received their first distribution check and began to understand the true power of the world of real estate syndication investments. So, remember, you are not alone in any real estate syndication, no matter where you are in the process of investing or your journey as an investor.

You are part of an Ohana, a group of investors who share your thoughts and are also working to provide for their families, grow their wealth, and, perhaps, even have a positive influence on this world.