Tel: 800-270-3565
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Partnership:
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We recognize that through partnership virtually anything can happen. This premise is no more evident than in real estate investment. Countless transactions have been done through some form of partnership. Here at the Real Estate Action Network, many of our members have expressed an interest and proven their ability to perform on partnership transactions. Although there are numerous ways to structure partnerships in real estate, the primary types of partnership transactions done through the network are as follows:
Credit Partnership:
Credit partners provide their ability to qualify for a loan and share in the profits earned on an investment. In most cases, cash is provided and the credit partner secures the loan. Once closed, the property is put into a holding entity (i.e. Trust or LLC) where all parties have a vested interest and profits are split.
Equity Partnerships: (Joint Venture)
Instead of investing in a trust deed or debt instrument, equity partnership is ideal for investors who are willing to take on a bit more risk for greater returns. In and equity partnership, an agreement is created with the investor on one or multiple projects where the investor's capital is used to fund the project(s). Although there is no defined rate of return as there are with debt instruments, typically yields are much higher. Upon the sale or repositioning of the property(s), the net profits will be split with the investor based upon the percentage agreed upon in the contract. The investor has the ability to select the investments they would like to participate in by analyzing a preacquisition due diligence report. This allows them to make an informed decision prior to committing any capital.
Real Estate Syndication:
Simply explained a syndication is where two or more property investors form a company and take part ownership of a real estate asset, the asset is then divided up into two or more investment units. Members of the syndication are not always capital contributors. Sometimes members bring their credit or experience to the team. For example contractors, property managers, or real estate brokers can be part of the syndicate. For more information on real estate syndicates, please click here.
Check this week's education series video:
How to accurately determine market value.
Interested in learning more about how you can get involved in the network?
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Join us and get into action
Through partnership and taking action, virtually anything can happen!
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