As being a real-estate syndicator, I figured what is important that might make accredited investors wish to passively invest and partner with this firm was the return. However i soon seen that wasn’t the biggest concern.
My experience has provided me the ability to better understand passive investors. Along with today’s blog, I am speaking about these major causes I’ve discovered to be why investors invest passively inside our apartment syndication.
1. Knowing their cash is in safe hands
2. Like a portion of a process which is trouble-free
3. Consistent updates on important information concerning the deal
Knowing their money is safe hands…
As with all other investments, there are no profit or capital preservation guarantees within the owning a home business. Therefore, passive investors need to know that we’re taking all preventive steps to lower risks. We do this in-part by adhering to the next three fundamental principles of apartment investing. (i) We secure long-term debt (ii) We don’t upgrade on appreciation simply for cashflow (iii) We make sure there exists adequate cash reserves. Overall, investors would like to know that their funds are safe. For their syndicator, we show them this when you are excellent communicators, minimizing associated investment risks, getting the necessary industry experience and building a good meaningful relationship.
Like a part of an activity that is trouble-free…
Every passive investor uses a trouble-free process. They want to be a passive investor simply because they wanted to put their take advantage a profit-yielding investment without having to bother themselves about daily operations. Most savvy passive investors are busy with other money-making businesses, in order that they have little time to spare.
After undertaking initial research about the deal before investing, investors want an investment that won’t let them have sleeplessness. It really is for that reason the only work we want our investors to perform is check their monthly email about the deal and receive their cashflow and profits.
Consistent updates on information in regards to the deal…
What our investors want is exactly what we feature, a clear, clear language, to-the-point, no fluff investment update with real numbers, solutions (if there’s an issue) and real-time property info & data. To be sure our investor receive the absolute best communication on a monthly basis our deal updates include but aren’t limited by:
Any community engagement events
Any issues and our proposed solutions
Actual rents versus projected rents
Rehab and expense updates with pictures of the progress made
Distribution details
Actual rental premium versus expected rental premium
Relevant market and/or submarket updates
Then, every 4 months, we provide investors with all the current rent roll as well as the profit and loss statement so that they can assess the operations in the property and punctiliously investigate details if they want to. Our passive investors get distributions every month (not quarterly or yearly) so they not only receive updates but additionally receive payment.
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