As you now know, a syndication is a “group investment” and an incredible opportunity that we talk a lot about here at Taylored Investments. You can put your money to work and take advantage of a majority of the benefits of real estate without the hassles of being a landlord! But when you first begin to consider a real estate syndication as an investment option, it can feel a bit overwhelming and intimidating!
My husband and I personally experienced fears around investing in properties we had never seen (we invested in a fund-of-funds initially), concern about how we’d get my money back, and doubt around all the unknowns. We were looking to invest $100,000 in our first deal which is pretty significant!
We addressed these fears head-on through research; reading articles; having a lot of conversations; and doing our due diligence.
If you’re considering your first syndication and feeling hesitant, you are not alone. We highly recommend doing your research, asking a lot of questions, connecting with other investors out there, reviewing multiple deals, looking at different syndication sponsors, and taking your time.
Do Your Research
The best way to build your investing confidence is through research and self-education. There are so many good books, podcasts, websites, resources, and people out there that can help!
Books:
Rich Dad, Poor Dad by Robert Kiyosaki
Hands Off Investor by Brian Burke
Principles of Real Estate Syndication by Samuel Freshman
Podcasts:
BiggerPockets Podcast
The Real Estate Guys
The Real Estate Syndication Show
The Conscious Investor
Best Real Estate Investing Advice Ever with Joe Fairless
The Passive Wealth Strategy Show
The Real Wealth Show with Kathy Fettke
Ask Questions
There are many Facebook groups and online forums like BiggerPockets can help you learn what questions you should be asking. There are most likely others that have asked about your same concerns and, just by reading through the forum’s questions and answers, you’ll gain clarity!
There are absolutely no dumb questions and that you have the right to be diligent about gathering answers to your concerns.
Connect with Other Investors
A successful investor needs a supportive community, and considering that syndication is a group investment, you’ll want to get networking.
Any new investors will share similar fears, concerns, questions, and excitement. Experienced investors can provide invaluable firsthand accounts of their experience with various projects and sponsors.
Find other investors through online forums like BiggerPockets, local networking events, or by asking sponsors if they’ll connect you to their current investors.
Review Multiple Deals
Finding comfort with financial projections, summary data, and investment lingo may feel overwhelming.
As you review more investment summaries, you’ll start to understand the flow of the deal packages and exactly which investments interest you.
Look at different Syndication Sponsors
There are many great sponsors out there putting deals together (and some not-so-great). Don’t settle for the first group you connect with or the one that you relate with the most! They may or may not be the right fit. It’s important you have a relationship with them and know their track record before you invest your hard earned dollars in their deals.
Take Your Time
Often new investment opportunity will fill up quickly. This can make new investors panic and start to believe they are missing the best deals.
Remember, there will always be another opportunity down the road.
Allow yourself time to complete the steps laid out here, so that when you make your syndication choice, you are confident at every step.