General partners have the skills and know-how to navigate the real estate market successfully. Sponsors take an active role in the syndication by handling all research, legal, and financial decision-making in the real estate syndicate, including:
Investors support the real estate syndication by providing the necessary capital for purchasing and maintaining the property, which is a passive role. While general partners may contribute capital, investors are the main financial supporters of the operation.
Investors must be accredited to participate in real estate syndications, as they must show that they have financial resources to contribute. Real estate syndications often have a minimum amount that an investor must contribute; however, this amount is much, much lower than the amount you would have to contribute if you invested in real estate entirely by yourself.
There are three types of real estate syndication models, each with its partnership structure, tax implications, and financial benefits.
The simplest syndication structure type: a signed agreement between all parties. In general, these types of syndications can be created and dissolved at any time. All assets, profits, and liabilities are shared in this agreement.
Similar to a general partnership, different liabilities are assigned to the general and limited partners in a limited partnership. General partners take on a more significant amount of legal liability in exchange for playing a more active role. At the same time, passive investors have less legal liability. Often, but not always, active roles in this type of syndication receive greater financial compensation for the work that they do.
This structure creates an LLC, a distinct entity separate from the general partners or passive investors. In real estate syndications, the LLC will own the properties outright. As a result, the partners’ and investors’ personal assets are protected if the company faces legal trouble.
Considering these types of structures is essential as you search for a real estate syndication to join.
Location: Some locations may be desirable for people now, but later individuals may be less interested in living there. Some sites may also pose environmental risks, such as being in a floodplain or an area prone to wildfires.
The quality of the property itself, such as problems with the foundation, electrical wiring, roof, or general age, can result in unexpected costs and renovations sooner rather than later.
Tenants can cause damage to the property, which can result in unseen losses.
Finally, there are inherent risks to participating in a real estate syndication, including the loss of money and loss of your passive investor status. These risks are why you need to understand the terms and conditions you must abide by when taking part in a real estate syndication.
This is why MUSA has made it our mission to have expertise in syndication with a team of seasoned real estate experts and financial gurus. When prospecting an investment opportunity MUSA leaves no stone unturned in its pursuit of outstanding returns.
Our investment strategy is anchored on identifying low-risk opportunities that offer significant value-add potential, enabling us to preserve our investors’ capital while maximizing their long-term growth potential.
As a potential investor, your financial resources are on the line when participating in a real estate syndication. As an investor, you are also taking a passive role in the relationship, meaning you only provide capital.
Remember that any other type of contribution to the syndication that would put you into an active role opens you up to additional legal risks. Thus, you must be completely comfortable when handing the decision-making power to the general partners.
This is why it’s important to fully understand the capital structure and investment process when you sign onto a syndicate, including what types of financial returns are expected and what you, as an investor, are expected to contribute. Doing so allows you to maximize your returns, including the tax benefits available to passive investors.
Navigating the real estate business — from determining which properties to purchase to tenant management, upkeep, and general maintenance — can be difficult, especially for newcomers. Joining a real estate syndicate can allow you to break into the real estate industry and generate a passive income with minimal hassle. Multi-family units, in particular, can be an excellent option for those looking to invest in a market with
considerable potential for years.
By doing thorough research, having clear expectations for what you are looking for, and knowing the ins and outs of the business, you can select a real estate syndication that accomplishes your unique financial goals. Multi-family real estate syndication is an excellent option for beginners in this industry, and by investing the smart way, you will generate wealth for years to come.
We typically engage in syndication deals that fall within this range. This amount allows us to take advantage of proven value-add strategies.
Classes A and B offer reliable returns with lower risk, but also have the potential to out perform market expectations.
MUSA has a proven track record of maximal occupancy for its properties. We leverage numerous strategies to keep our properties filled.
Including the appreciation value from sale of property, our investors see returns within this range for each year of investment.
Our total portfolio debt coverage is industry leading. We maintain a strong ratio to ensure your capital is protected.
Hold times of within this range give us time to fully carry out our value add strategies, while also allowing for a considerable amount of monthly income.
Delving into real estate investment can be a daunting task, particularly when you’ve already got a full plate. For individuals with a wealth of life experience, passive investing through real estate syndications emerges as an ideal solution. This avenue offers you the advantages of real estate investment without the intricate responsibilities of being a landlord.
Embark on your real estate investment journey with ease by becoming a distinguished member of the MUSA Investor Club. Join today to explore tailored investment opportunities and industry leading returns.
1643 Westwood Blvd.
Los Angeles CA 90024
