WHAT IS APARTMENT SYNDICATION?
The most basic definition of syndication I can think of is, “a group of individuals or companies combining their resources (time, expertise, money, etc) to do something they couldn’t do, or that would be very hard to do, on their own.”
A LOT of people would love to benefit from owning an appreciating asset, like an apartment complex, that provides cash flow and extremely attractive tax incentives. However, very few people have the ability (time, expertise, money, etc) to purchase a big apartment complex on their own.
Problem: Individual Ability
Solution: Real Estate Syndications
“Excellent!”
WHAT APARTMENT SYNDICATION IS NOT
For clarification, apartment syndication is NOT the same thing as a REIT (real estate investment trust). A REIT is a privately or publicly traded company that owns and manages real estate holdings. When you invest in a REIT, you’re not investing in a specific investment, but rather into a specific company.
Syndication differs in that when you invest with a syndicator, you own a percentage of the property itself. This is important because it allows you, as an investor, to actually own and benefit from all that real estate has to offer. One small example, (with a big impact), investing in a REIT doesn’t provide you the same tax shelters that come from owning a percentage of the actual property.
