How to Analyze a Passive Investment Opportunity in Real Estate Syndication

How to Analyze a Passive Investment Opportunity in Real Estate Syndication

Passive investment opportunities in real estate syndication can provide outstanding ways to generate attractive financial returns. In the very best scenarios, you and your fellow passive investors can earn consistent income with few of the headaches that come from other types of investments. Simply put, these passive investment opportunities offer great chances to build real wealth.

That being said, getting to these ideal scenarios doesn’t automatically happen. They require some diligence from your end. Because of this, it is worthwhile to explore some of the things that you should consider when analyzing a passive investment opportunity. By doing your homework now, you can avoid mistakes and find the best passive investment opportunity for you.

First Principles in Analyzing Passive Investment Opportunities

To be clear, these are several first principles that you should follow when considering a syndication opportunity. They aren’t the only things that you should consider. Generally speaking, by being measured, reserved, and rational, you will make great decisions.

One of the first things that you can do is research specific asset classes and markets. There are plenty of multifamily asset class types, ranging from new upscale luxury buildings to 40-year-old buildings that were built for low-income residents. Each asset class provides its challenges and opportunities, so you’ll need to evaluate your risk profile before proceeding. The same is true of markets. You may have some more familiarity with a local market, but there may be greater opportunities elsewhere. Make sure that you are soberly thinking about your opportunity set before proceeding.

As with any type of investment, another one of the first things that you should do is research your potential partners. Naturally, much of the attention will veer toward the sponsor or general partner. This is for good reason, as the sponsor is active in the day-to-day operations of the syndicate. But beyond the sponsor’s experience and background, you will also want to evaluate the relevant property management company, commercial real estate broker, and any real estate and securities attorneys. See how they evaluate potential deals and how quickly they can close potential deals.

It takes a team to create and run a real estate syndicate, so you want to have a good understanding of your new partners. Beyond doing simple Internet research, don’t hesitate to make some reference checks. Speak with other limited partners who have worked with any of these individuals or entities. Completing this primary research will give you the confidence that your partners will maximize the value of your investment.

From there, you will need to closely scrutinize your potential returns. After all, much of your interest in real estate syndicates likely comes from the fact that you can earn outsized returns. As a limited partner, you can be compensated in several different ways, including a preferred return, a profit split, or supplemental loan proceeds. Preferred returns and profit splits are more common, but you’ll want to read the fine print for more. For instance, you may discover that your preferred return is 8% before the general partner is paid. Or you may discover an unequal profit split in your favor after that preferred return. Make sure you understand your potential profit before entering the syndicate.

Finally, you will want to examine the opportunity’s underlying fee structure. Sponsors, real estate attorneys, property management companies, and others provide significant value to the overall syndicate. Because of this, they receive compensation for completing their work. This compensation may impact your overall return on the property. For instance, your sponsor may take a profit split on an ongoing basis or upon the sale of your property. Your property manager may take a 10% management fee on the collected income. Whatever the case may be, have a good understanding of how your partners are being compensated. No fee structure, in and of itself, is good or bad. It depends on the value you are getting from your partners and how those fees impact your total returns.

Get Started Today

Whether you are new to passive investment opportunities or have been making investments for some time, it is critical to keep these first principles in mind. They can both help you find attractive investment opportunities and avoid those that are less attractive to your financial goals. Ultimately, the best time to get started is today.

How to Invest in Multifamily Real Estate Using A Self-Directed IRA or solo 401K

How to Invest in Multifamily Real Estate Using A Self-Directed IRA or solo 401K

Can I Invest in Multifamily Real Estate Syndications Using Funds From My IRA?

Yes you can, by transferring the funds from your IRA into a self-directed IRA. This article will explain how that works and how doing so will increase your investment options, allowing you to use those funds to invest in a multifamily real estate syndication.

Why would you want to do that? Regardless of the amount of money that you have been able to save, the gold standard is to have those savings tied to investments that are both stable and produce strong returns.

The main advantage of investing in a real estate syndication is the return. If you have money wrapped up in an IRA account that’s earning only 1-2% a year, you may wish to look into setting up a self-directed IRA (sometimes called a checkbook IRA) to allow you to invest in real estate. 

Why A Self-Directed IRA?

Only the self-directed IRA can be set up to invest in real estate syndications. The tax code allows for this, and the key is to place your self-directed IRA account with a custodian that will accommodate investments for multifamily syndication. An IRA custodian is the financial institution responsible for record-keeping and IRS reporting requirements.

Multifamily, value-add syndications are a great type of investment for a self-directed IRA, they generate passive returns and then are liquidated for a bottom-line profit. That profit is usually taxed as a capital gain, but if it happens within your IRA, you won’t pay taxes until you actually retire and begin to withdraw income from that IRA.

You have to wait until you reach age 59½ to withdraw your funds, and the withdrawal will be included as ordinary income on your tax return. In the meantime, you have the right to invest in a real estate syndication deal or multiple deals, while maintaining the tax-deferral status of the IRA.

What is a Self-Directed IRA?

An IRA is an individual retirement account that allows the account owner to direct the account trustee to roll over all or part of their IRA and make investments in alternative assets such as real estate. Rolling the funds over from your IRA into a self-directed IRA gives you control of your own financial future. You control the investments instead of the company that handles your IRA.

With a self-directed IRA, you can create a Limited Liability Corporation, (LLC), and that entity invests in and holds your IRA funds. As the LLC General Manager, YOU can now handle the investing.

Tax Implications

Like a traditional IRA account, a self-directed IRA allows owners to defer taxes until retirement age. 

When using a self-directed IRA for purchasing real estate, you can’t claim depreciation on property held within it. Also, there may not be a way to take advantage of operating losses as well.

Another thing to consider is income. Most people consider the income that is produced from their IRA as investment income. Occasionally, the IRS may categorize it as business income instead.

If it does, then that income can be subject to something called UBIT, or “Unrelated Business Income Tax” which can be taxed at rates as high as 39.6%.

UDFI, or “unrelated debt-financed income,” is primarily used in the context of IRA investments that generate income derived from debt-financed real estate or other property owned by the IRA. The UDFI is subject to UBIT.

You may be liable to this tax if your IRA participates in buying and selling a significant number of real estate properties in at least half of a year.

The best way to be certain about whether you owe UBIT is to talk with your tax professional.

A Roth Self-Directed IRA

You will eventually have to pay taxes on the tax-deferred income in your IRA when you take cash out. An alternative is to choose a Roth SDIRA. With a Roth SDIRA, there is no up-front tax break, it uses after-tax contributions, but you don’t have to pay tax on withdrawals in retirement. Your earnings will grow tax-free and when you take distributions from the account in retirement, you won’t owe any taxes on them.

Solo 401k

Making the choice between setting up a self-directed IRA or a solo 401(k) is an important decision. You need to consider all of the differences.

To be eligible to benefit for the Solo 401k Plan, investors must meet two eligibility requirements:

  • The presence of self-employment activity.
  • The absence of full-time employees.

If there will be debt on real estate investments you are much better off choosing a solo 401(k) over an IRA as solo 401(k)s are exempt from UDFI tax on leveraged real estate.

The Importance of A Good CPA

It is vitally important that you work with a good Certified Public Accountant (CPA) who understands the legal side of real estate investing. Getting the right tax advice is essential in making the best use of your retirement funds.

Setting up Your Self-Directed IRA

A Self-Directed IRA LLC may be funded by a transfer from another IRA account or through a Self-Directed IRA Rollover from an eligible defined contribution plan. Eligible defined contribution plans include qualified 401(k) retirement plans.

With the transfer, you do not receive the IRA assets. The transaction is carried out between the two financial institutions. In order for the IRA transfer to be tax-free and penalty-free, the IRA holder must not receive the IRA funds in a transfer. Rather, the check must be made payable to the new IRA custodian.

You can then instruct the new custodian that you select to request the transfer of IRA assets from your existing IRA custodian in a tax-free and penalty-free IRA transfer. 

Once the IRA funds are either transferred to the new custodian, the new custodian will be able to invest the IRA assets into the new IRA LLC “checkbook control” structure.

Once the funds have been transferred to the new IRA LLC, you, as manager of the IRA LLC, would have “checkbook control” over your retirement funds so you can make traditional as well as non-traditional investments tax-free and penalty-free.

It is important to choose the right custodian, consider their experience, fees, and areas of expertise, and check out their rating with the Better Business Bureau.

A Word Of Caution

According to the Securities and Exchange Commission (SEC), you need to guard against criminals attempting to commit fraud against self-directed IRA account holders. Protect Yourself by:

  • Not taking unsolicited investment offers.
  • Asking lots of questions – be suspicious if these are not welcomed.
  • Being wary of those promising unrealistic returns on your investment. 

Why Multifamily Syndications?

It’s true that you have many options when it comes to investing. Some high-risk investments yield a high rate of return. Then there are safer investments but the rate of return is low. Multifamily real estate combines low-risk with generous returns.

The most common use of self-directed IRA funds is an investment in syndicated real estate deals.  A syndication is a group of investors pooling their funds for investment.  The investment is typically larger than one the investor could accomplish on their own.  These real estate investments are professionally managed and you are not required to do any of the legwork.

Investment returns & distributions are returned to the self-directed IRA as cash. Accumulated cash distributions can later be invested in another investment.

Pros and Cons

From what we have discussed so far you can see that using a self-directed IRA to invest in residential or commercial real estate which is not allowed through regular IRAs has pros and cons.

Let’s get specific and list them, starting with the positives.


  • Tax-free or tax-deferred account growth – With a self-directed IRA, you can invest in real estate as you normally would, but your gains are tax-free or tax-deferred, depending on the type of IRA account you use. There aren’t many other opportunities to invest in real estate in a tax-sheltered way.
  • Control over your investments – As the owner of the account, you get to decide what to do with your investments. It’s possible to create a limited liability company (LLC) for your SDIRA. Doing this gives you checkbook control.
  • Investing through an LLC can also provide other liability protections, though you should consult with a tax professional to better understand the LLC laws in your state.   
  • Potential For Higher Returns – A self-directed IRA real estate investment has the potential to earn a higher ROI than investing with traditional securities.


  • Fees – The Internal Revenue Service requires that either a qualified trustee or a custodian hold assets on behalf of the IRA owner. This means costs that can eat up into your profits if you’re not careful.
  • Complex Regulations – Your SDIRA could be disqualified as a tax-advantaged account if you don’t follow all of the IRS regulations carefully. 
  • UDFI – if your IRA owns property that has been financed, some of the income from the property is considered unrelated debt-financing income (UDFI), which is subject to taxes.

Are Self-Directed IRAs For You?

Those investors who choose to use self-directed IRAs do so to seek higher returns and greater diversification. 

Self-directed IRAs may not be for everybody but if you want to take advantage of higher yields and less volatility you should seriously consider the possibility.

If you are creative and knowledgeable enough to use self-directed IRAs in the right way it could be a great option for you and your investment future.

Passive Investment in Multifamily Syndication vs. REIT – Which is Better?

Passive Investment in Multifamily Syndication vs. REIT – Which is Better?

Maybe you realize you want to invest passively in real estate, but you’re not sure which is better for you – to invest in multifamily (through a syndication) or an REIT.

This article helps you understand the difference between passive investment in multifamily versus passive investment in REIT, and aims to help you make an informed decision.

What is REIT?

A Real Estate Investment Trust, or REIT, is a company that has a wide range of revenue-generating properties. It involves a pool of passive shareholders, who receive subsequent dividends on their investment. A REIT can be any registered corporation or association that invests in real estate intending to generate revenue. It treats an investment as buying stock.

What is Multifamily Property Syndication?

A multifamily property refers to a residential property with more than one unit of accommodation, such as apartment buildings, townhouses, duplex properties, and condos. Syndication offers multiple individuals a wonderful passive investment opportunity that can generate substantial revenue over time.

Comparing REIT with Multifamily Property Investment

Now that you have a basic idea of these two types of passive real estate investment that you can venture into, let’s see which one is better for you. There are several factors on which you can weigh the two types of investments against each other.

Minimum Investment

When it comes to REITs, there is no cap on the minimum or maximum amount that you can invest, which makes it a much more flexible form of passive investment than multifamily properties. But there may be a rule where you can only buy shares in blocks of 10 or 50, and this is predetermined by the company you are buying real estate stocks from. This means that you can start from as low as $1,000.

On the other hand, when you invest in multifamily property, usually there is a minimum investment.  For example, some syndications require at least $50,000 as an initial investment. Plus, it may also ask for higher subsequent investments, which is not the case when you invest with REITs. This makes them much more flexible in terms of the minimum investment requirement.


One factor in which multifamily investments take the lead over REITs is the rate of return. With REITs, for the past five years the average annualized REIT return is under 6%, which is better than having it sit in a savings account, but could be better.

On the other hand, most multifamily property investments can bring you excellent yields of 9% and greater. Some properties have even brought wonderful returns of over 15%.


Liquidity refers to the ease with which an asset can be converted to cash, and while real estate investments don’t normally offer too much liquidity, you can actually experience it when you invest in REITs because you can trade them like a standard stock. If you have invested your capital recently but need to withdraw it for an emergency, you can do it quicker than you can with an investment directly in a multifamily property.

In a multifamily property syndication, your investment is locked in with the other investors, at least until the hold period is underway. However, there is a workaround to this problem and you can add it to your partnership or association agreement, which can help you get your capital amount back in a reasonable time.


When it comes to taxes, whether you invest in REITs or a multifamily property syndication, there are depreciation benefits. With REITs, there is no way for you to defer the taxes on the profit that comes from the sale of your stocks. 

On the other hand, investing in multifamily properties allows you to defer the taxes if you reinvest in another project by taking advantage of the 1031 exchange.

Diversification of Portfolio

No matter what investment you make, your financial advisors may have always advised you to invest in a diversified portfolio or to “never put all your eggs in one basket”. This is a sound strategy that you can also apply to passive real estate investments. 

In REITs, your investment is distributed between an entire portfolio of properties, and their individual financial performance combines to bring you a safe and significant return.

On the contrary, with a multifamily syndication, your investment is tied to one multifamily property, and its financial performance constitutes the amount you get as a return on investment. But you can still diversify by investing with multiple syndicators, which is a viable option.


The risks also need to be assessed when you compare REITs with multifamily syndications. Since REITs are based on the buying and selling of stocks, the value of your investment may fall as the market value of the stocks goes down. This can present a risk.

Multifamily properties are typically a much lower risk, since they give you partial ownership in a physical asset, and the chances of the property value falling drastically are very unlikely.

Ease of Entry

The ease with which you can start investing in REITs or multifamily properties is also a deciding factor for some. As mentioned above, REITs have a smaller minimum investment requirement, and also don’t require any form of accreditation or validation about your financial condition or ability to invest.

However, when it comes to multifamily properties, depending on the route the company that you invest in is taking, they may require you to be accredited.  If so, they may ask you to provide an income statement that shows you have an annual income of at least $200,000 to be able to invest in a property. 


When you invest in a REIT, you own stocks of the real estate portfolio that you invest in, which is somewhat abstract, and you don’t get your name on any property. This also means that you don’t reap the full benefits of the financial performance of that portfolio. 

On the other hand, investing in a single multifamily property allows you to attain ownership of the asset.  You have partial ownership of a real property that you can physically see.  You can see how the investment progresses as the company you’ve invested with implements their plan to improve profitability.  Your profits are tied to tangible things – improvements made, rents increased, occupancy rates, etc., which you can track.


Reachability refers to the ease of access that you have with the people who manage your investment.  With REITs, it can be quite difficult for you to reach out to fund managers or investment consultants. Rather, you will be directed to a manager or representative.

This is an area where investing in multifamily properties excels, because you have direct access to the general partner or sponsor you’ve invested with – the person managing your investment.  You don’t have to go through some complicated process to speak to a real human, only to find out they can’t really do anything for you.  You can pick up the phone and call the general partner / sponsor or send them an email directly.

Key Takeaway

Both REITs and multifamily syndications allow you to make sound passive investments, and they are generally more attractive than other types of investment.  Do a little homework to determine what’s the best fit for you and then invest with a company you trust.

If you’re interested in high returns and great tax benefits, we would love to speak to you about investing passively in one of our upcoming multifamily property syndications. Contact us today to get started! 

Active vs. Passive Property Investing: What’s the Difference?

Active vs. Passive Property Investing: What’s the Difference?

There’s a lot to learn when you first start thinking about investing in real estate and a lot of decisions to make. One of the very first decisions is whether you want to be an active or passive investor. To decide, you should know what each involves, as well as the pros and cons. Read on to discover which is right for you. 

What is an active investor? 

An active investor is in control of the property or properties and spends a lot of time ensuring everything is running smoothly. They are responsible for: 

  • Finding the property 
  • Securing financing for the investment 
  • Making a business plan 
  • Executing the plan 
  • Finding and managing the right team members 
  • Talking to property managers 
  • Managing the risks associated 
  • Putting things right when they go wrong 

If you have the required time, the idea of starting a new business excites you, and you want to be involved in every aspect of the day-to-day management of your investments, then being an active investor may suit you. Let’s take a look at the pros and cons of being an active investor: 

Pros of Active Investing 

  • You are in full control 
  • You know every detail of what’s going wrong or right 
  • If you have sufficient resources, you can be the sole investor and receive all income or profit 

Cons of Active Investing 

  • You are responsible for everything 
  • You need to invest the time to learn what you need to know to make the right decisions 
  • You could make costly poor decisions if you don’t have someone experienced to guide you 
  • If you’re not available full-time, it can eat up all your spare time 
  • You are responsible for building the right team and replacing anyone as necessary 
  • If you’re seeking a significant amount of financing from others or institutions, you need to be able to prove why you are a good investment 
  • More of the risk typically rests with you 
  • Renovation budgets can get out of hand quickly, especially if you don’t have a lot of experience evaluating properties or if you get carried away with the finish of the property 
  • If you fail to correctly project your costs, you could end up with a much less healthy profit margin (or even none at all) 

What is a passive investor?

passive investor (also known as a limited partner) is someone who is happy to invest the money and let someone more experienced take on the day-to-day operations. Limited partners invest their money with someone knowledgeable, such as a multifamily syndicator (often referred to as a sponsor).  

You will see a return on your investment with little-to-no effort from you. You might compare it to investing in the stock market, where you invest your money in a certain company, but don’t have to deal with the day-to-day operations of that company.  However, the difference with multifamily investing is your investment is backed by a solid asset, and often the returns can be better.  

Let’s take a look at the pros and cons: 

Pros of Passive Investing 

  • You’re essentially hands-free 
  • Your money works for you while you live your life 
  • You can diversify through multiple syndications with the same sponsor or multiple 
  • Your sponsor is incentivized to make a return
  • Typically less personal risk
  • Developing a good relationship with a talented sponsor or syndication can result in many profitable investments for you 
  • In many cases, you will receive a “preferred return,” which means you’ll receive your return before the syndicator receives their money 
  • You’re trusting someone with more expertise rather than depending on your own research 

Cons of Passive Investing 

  • You have limited control over the business plan (instead, you choose to invest in one that appeals to you with someone you trust) 
  • A high level of trust in your sponsor is required
  • You need to be someone who knows how to delegate and let people do their work (ideal for busy business owners, doctors, those who have created and sold companies, CEOs, etc.) because you can’t micromanage your sponsor 

How Much Money Do I Need to Invest? 

If you’re going to actively invest, then that depends entirely on what model you choose. What class property are you looking at? Are you looking at single-family or multifamily properties? In some areas, you can get started for little (a down payment of around $10,000 for a single-family residence) if you are happy to have a large mortgage, though you do need to be aware that you should keep some money aside for emergencies and any periods without a tenant. Do your math meticulously to ensure you have a sound ROI. 

If you’re looking to invest passively, you should look to have $50,000 or more, again, depending on the specific properties, areas, and opportunities you’re considering. You won’t need to worry about additional costs, and most syndications aim to offer you a very healthy ROI. Why? Because they want you to invest with them again so they can make you – and them – more money in the future. 

So Which is Right for Me? 

You’re going to need to do your research, regardless of which style of investing appeals to you most. Obviously, if you plan to actively invest, you’re going to have to do even more because you’ll be making every decision. When you’re investing a lot of money, you need to ensure you’re getting it right. 

If you’ve always imagined being an active investor but are worried about the time commitment and making a mistake, starting with passive investing can be a good way to dip your toe and start learning what to look for in the future. 

If active investing doesn’t really interest you, but you’ve been interested in property investing due to the security a physical asset brings, then passive is the perfect choice for you. It can offer you all the benefits of investing in real estate, without the steep learning curve or headaches of managing your own properties. 

The good news is that just about anyone can invest in real estate, but you need to choose the right investment strategy. If you choose to invest actively but realize it’s not for you, changing your mind can be costly, not to mention stressful. Unless you have prior experience working in real estate, passive investing may be the safer bet. Just ensure you work with a syndicator you believe in that is happy to answer all your questions. 

If you’re interested in learning more about investing passively or about our upcoming syndications, please don’t hesitate to contact us

Balance Your Portfolio Through Diversification

Balance Your Portfolio Through Diversification

Current global events should motivate you to focus on certain pressing questions. Here is one of the most vital questions to consider:

Is my investment portfolio balanced and resilient enough to withstand market volatility or do I need to diversify more fully? 

This article will:

  • Give an overview of the importance of diversification
  • Encourage you to consider adding real estate investment to your portfolio to add stability
  • Explain how you can diversify your investments even within the sphere of real estate

Investment Diversification – An Overview

Why is diversification of your investments so important?

Diversification is the very best way to minimize risk. Every investor has different investment goals and it is important to have a clear view of your own, whether it is saving for retirement or for more short-term goals, focusing on your ultimate aims will enable success.

Of course, differing investment goals also means different risk tolerance which will have an impact on your investment portfolio.  Whether your investment goals allow you to tolerate slightly more risk or not, it is important to analyze risk reduction strategies.  Diversification is an excellent way to add stability and reduce risk while not affecting a portfolio’s wealth building capacity.

How does diversification achieve this risk reduction?

This is mainly achieved by ensuring your portfolio is spread across different types of investment that will each react differently to the same event.

The key with diversification is to try to limit the correlation between your investments. Simply investing in more financial assets does not mean better diversification if those assets are strongly related. For example, buying stocks in multiple companies of the same type is risky because a single event may cause all of those stocks to devalue. Due to globalization, asset classes are also becoming more correlated than in the past.

In view of the fact, that unexpected events can impact investment, you should certainly consider adding real estate to diversify and stabilize your investment portfolio. This reduces exposure to unsystematic risk by diversifying your investments and ensuring that they are not closely correlated to one another.

See the article, Investing In Real Estate Vs. The Stock Market

Add Stability to Your Portfolio by Investing in Real Estate 

Many investors shy away from diversifying their portfolio with a real estate investment because of their inability to liquidate that investment quickly. In actual fact, it is this illiquid quality of real estate investment that can anchor and stabilize your investment portfolio!

Real estate is a tangible asset and as such for many investors, feels more real. It is an asset that engenders confidence. A great appeal of this type of investment is its stability. For many millions of people, this kind of investment has generated consistent wealth and long-term appreciation.

See the article, Why Multifamily Investment Makes Sense

Real estate investment provides passive investors a very consistent and stable rental income. Having a home is a vital necessity for all people, and as a result, rental investors are relatively protected even during economic downturns.

As we have seen, your portfolio’s long term resilience lies in diversification across different asset classes.

Due to the different buying and selling dynamics of the private market, private real estate investment benefits from low correlation to the performance of stocks and bonds unlike publicly traded real estate investment trusts aka (REITs). That is why they are great options for diversification against unsystematic risk and are thus considered crucial to a clear strategy for diversification.

Even within the percentage of your portfolio that includes real estate investment we encourage further diversification subsequently reducing risk even further.

Diversification in Your Real Estate Investments

How can you create a diversified real estate investment portfolio?

There are three main areas where we encourage diversification. These are:

  1. Geography
  2. Asset Class
  3. Operator

Geography Diversification

Although the risk is relatively small, having all your real estate investments in one geographic location is like having all your eggs in one basket.

A real estate investment in a certain area affected by extreme weather for example, might typically perform well, but would it be wise to have all of your real estate investments in that one area?

Aside from weather issues, there are economic factors such as one area being heavily dependent on one particular employer or one particular type of employer. 

Although it would likely be wise to invest in that area in certain circumstances, if there is some major issue that affects that one industry or employer then that area might become vulnerable.

For these reasons, it is wise to spread your investments in real estate over a wide and varied geographical area as your portfolio grows.

Asset Class Diversification

When it comes to investing in multifamily properties, certain asset classes perform better in a growing economy while others weather a downturn more effectively.

See the article, Multi-Family Property Classifications and Your Investment Strategy

As your portfolio expands try to diversify as much as possible within the range of risk that you are comfortable with. (Some asset classes such as hotels may be too high risk for your liking.) The goal is for your cash flow/returns to remain consistent.

Operator Diversification

As a passive investor in a multifamily syndication, you are putting trust in the operator of the deal. Since the day to day running of the operation is taken care of by the operator this leaves you free to diversify and invest in multiple syndication deals. By doing so, you will not have 100% of your real estate investment capital with any one operator.

To summarize, advanced diversification affords investors the opportunity to increase return potential and reduce portfolio volatility. This is particularly true when diversifying into investing in real estate and when investing across various geographical locations as well as different asset classes and with more than one operator. While the details of the diversification are down to you, it is sure that the more advanced and carefully planned the diversification, the stronger and safer your investment will be!