As a property syndicator, I figured the biggest thing that might make accredited investors need to passively invest and partner with our firm was the return. However i soon realized that wasn’t the most important concern.
My experience has given me the chance to better understand passive investors. Along with today’s blog, I am speaking about the 3 major reasons I’ve seen to be why investors invest passively inside our apartment syndication.
1. Knowing their money is at safe hands
2. As being a portion of an activity that is trouble-free
3. Consistent updates on information and facts regarding the deal
Knowing their funds is at safe hands…
As with every other investments, there won’t be any profit or capital preservation guarantees inside the real estate investment business. Therefore, passive investors need to know that we’re taking all safety measures to reduce risks. We achieve this in-part by adhering to the next three basics of apartment investing. (i) We secure long lasting debt (ii) We don’t replace on appreciation limited to cashflow (iii) We ensure there’s adequate cash reserves. Overall, investors wish to know that their financial resources are safe. His or her syndicator, we imply to them this since they can be excellent communicators, minimizing associated investment risks, keeping the necessary industry experience and building a good meaningful relationship.
Like a a part of an activity which is trouble-free…
Every passive investor wants a trouble-free process. They need to become a passive investor since they wished to placed their cash in a profit-yielding investment while not having to bother themselves about daily operations. Most savvy passive investors are busy to money-making business ventures, so they have little time for it to spare.
After undertaking initial research on the deal before investing, investors want a good investment that won’t provide them with difficulty sleeping. It really is for this reason the only real work we would like our investors to do is check their monthly email for 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 supply, a specific, plain english, to-the-point, no fluff investment update with real numbers, solutions (if there’s a problem) and realtime property info & data. To ensure our investor obtain the absolute best communication on a monthly basis our deal updates include but aren’t tied to:
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
Actual rental premium versus expected rental premium
Relevant market and/or submarket updates
Then, every 4 months, you can expect investors with all the current rent roll along with the profit and loss statement in order to assess the operations from the property and thoroughly investigate details should they need to. Our passive investors get distributions every month (not quarterly or yearly) in order that they not just receive updates and also receive payment.
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