Like a real estate property syndicator, I figured what is important that might make accredited investors desire to passively invest and partner with your firm was the return. But I soon remarked that wasn’t the greatest concern.
My experience has given me the opportunity better understand passive investors. Along with today’s blog, I will be referring to the three significant reasons I’ve found to be why investors invest passively within our apartment syndication.
1. Knowing their cash is within safe hands
2. As a a part of an activity that is certainly trouble-free
3. Consistent updates on important info concerning the deal
Knowing their cash is within safe hands…
As with every other investments, there are no profit or capital preservation guarantees within the real estate investment business. Therefore, passive investors wish to know that we are taking all safety measures to lower risks. We accomplish that in-part by adhering to the next three basics of apartment investing. (i) We secure long term debt (ii) We don’t purchase for appreciation just for cashflow (iii) We make sure there’s adequate cash reserves. Overall, investors want to know that their money is safe. As his or her syndicator, we suggest to them this when you are excellent communicators, minimizing associated investment risks, getting the necessary industry experience and building a good meaningful relationship.
As being a part of a process that is certainly trouble-free…
Every passive investor wants a trouble-free process. They need to turn into a passive investor simply because they wished to put their profit a profit-yielding investment without needing to bother themselves about daily operations. Most savvy passive investors are busy along with other money-making businesses, so they really have little time and energy to spare.
After undertaking initial research about the deal before investing, investors want a smart investment that won’t give them sleepless nights. It really is on that basis the one work we want our investors to do is check their monthly email around the deal and receive their cashflow and profits.
Consistent updates on important info about the deal…
What our investors want is exactly what we feature, a specific, clear language, to-the-point, no fluff investment update with real numbers, solutions (if there’s a concern) and live property info & data. To make certain our investor have the absolute best communication monthly 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 images of the progress made
Distribution details
Actual rental premium versus expected rental premium
Relevant market and/or submarket updates
Then, every four months, you can expect investors together with the current rent roll and the profit and loss statement to enable them to evaluate the operations of the property and punctiliously investigate details when they desire to. Our passive investors get distributions every month (not quarterly or yearly) so they not just receive updates but also receive payment.
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