Does anyone have experience with investing in real estate syndications?

[ratdaydays]

I learned about the concept of real estate syndications a few years ago. You usually have to be an accredited investor to invest. I like the concept of it, you pool your money with other investors to buy an apartment building and then the syndication company manages everything. It's different than a REIT because you get the tax benefits of real estate- depreciation, 1031 exchange. I've been looking into one company called 37th parallel. Of course, everything sounds good on their website. I was wondering if anyone has experience with this, positive or negative.

[Zoot Allures]

Have you taken any steps on this? I've been looking into syndication as well. I like the passive nature of it, but you have to do the work of finding good opportunities and partners you can trust. There's plenty of risk involved, so you'd want to do a ton of research on whatever opportunity you come across. The sponsors will likely provide a strong business case for the specific project and why it makes sense for the local market, but I'd probably be more swayed by my research on the sponsors themselves. If they seem trustworthy and have a good track record, that would matter to me more than my own admittedly amateurish understanding of the particulars of the project.

[NorCal]

I made a small investment in a syndication with a cousin who is a real estate developer.  This was a multi-family project with ~75 units.  I posted on this a few years back, but would need to search for the thread.

The returns have been good for me, but this is a sample size of one in a very risky space.  You would only want to do this with someone that has a track record, and is bringing some bigger investors on board.  You also should be skilled in reading and understanding financial projections.  I would only do this for projects that have the reasonable possibility of returns in the mid to high teens.

You do need to be an accredited investor, and it will make your taxes more annoying.  K-1's received in August are common.