WHAT IS A SYNDICATION?
Syndication is the pooling of money where the investors are a passive, limited partner (LP). The other partner in the deal is the Sponsor, or simply an active partner which puts the deal together and implements the business plan to provide a return for the benefit of all investors. You will hear General Partner (GP), Syndicate and Sponsor often used interchangeably.
WHAT ARE YOUR RETURN PROJECTIONS AND HOW ARE YOUR RETURNS CALCULATED?
Typical cash on cash returns are in the 8-10% range and internal rate of returns (IRR) range from 16 – 20%. IRR generally is a better measure for varying cash flows over a set time horizon.
WHAT ARE THE RISKS?
Like all investments, investing in real estate involves certain known and unknown risks, uncertainties, and other factors and there are no guarantee of performance. It is CashFlow Investor’s requirement that each investor acknowledges and understands these risks and factors.
WHO CAN INVEST WITH US?
We provide offerings for both accredited and qualified non-accredited investors. An accredited investor is a person earning $200K per year or a couple earning $300K per year over the past two years and expected to do so in the current year; or a net worth of $1M (excluding your primary residence). Non-accredited investors can be qualified by their investing experience and/or the presence of a financial advisor on their team.
CAN I INVEST WITH MY IRA?
Investing with an IRA is a common way to invest in real estate syndications. Custodians we can work with include Equity Trust Company, Kingdom Trust IRA, The IRA Club, Sunwest Trust, and Advanta IRA.
HOW LONG WILL THE INVESTMENT BE?
Each property has a targeted hold period. This targeted time frame is calculated based on current economic trends and forecasted financials throughout the project lifetime. This projected period is not guaranteed and there are many factors that may change this time frame. Cash Flow Investor is committed to meeting holding periods and consistently delivering returns for our investors. It is our job at Cash Flow Investor to ensure that each project optimizes its cash flow potential throughout the lifetime of the project.
WHAT IS A LIMITED PARTNER?
A limited partner is a passive investor in the deal. They have limited liability as well as limited decision power in the daily operations of the property. Their risk is limited to the amount they invest in the deal and their other assets are protected. They cannot be sued, they are not on the loan and are not responsible for the active performance of the property.
WHEN ARE PROFITS DISTRIBUTED TO INVESTORS?
Distributions are typically made throughout the holding period on a quarterly basis. Any profits from a refinance or sale of the property will be distributed after the refinance or sale closes.
DO INVESTORS SHARE IN ANY OF THE TAX BENEFITS OF OWNING REAL ESTATE?
Apartment syndications are very tax efficient. As a partner in our limited partnership, you will benefit from your portion of the investment’s deductions for property taxes, loan interest and depreciation. You will get a K-1 statement from the partnership for the current tax year. Additionally, any refinances or supplemental loans are reviewed as a return of equity so no tax impacts. At time of sale, there may be an opportunity to 1031 exchange into another property to defer long-term gains tax. Keep in mind some depreciation may occur at time of sale if a 1031 exchange does not occur in addition to the long-term capital gains tax you would be responsible for paying on the gains.
HOW DO I GET MY INVESTED CAPITAL BACK?
Each Property has a targeted hold period. This targeted time frame is calculated based on current economic trends and forecasted financials throughout the project lifetime. This projected period is not guaranteed and there are many factors that may change this time frame.
WHAT TYPES OF PROPERTY CAN I INVEST IN?
The types of properties will be described in each investment opportunity.
CAN I SEE THE PROPERTIES I INVEST IN?
All of the details for each property are available to view online.