Real Estate Syndication
Im a senior in highschool who is eventually looking to do syndication, what would be a good track record to create for investors in the future. heading to auburn university next year.
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Worry about just getting into the industry in general. There's a million threads on here about high school and college students asking "how do I get into real estate?" and the answer you'd get here is going to be the same. No one would trust millions of dollars to someone in their mid-to-early 20's so you are more than 10 years out of thinking about syndicating a deal. Think about it from the angle of an investor before you think about asking others for money...would YOU give a large amount of money to someone without a track record of investing and relatively no experience (compared to the experience professionals that have done it for decades)? No? Then why would they?
I don't want this to sound like putting you down, it's great that you have career ambitions. But, don't worry about 5 steps from now and worry about getting good grades in college. Then worry about getting an internship at a developer or REPE (brokerage or lender if you want to go those routes too). Once you get a couple internships and figure out what asset classes you like working with and what city you want to live in, then focus on getting a full time job. Once you get a full time offer, all you have to do for the next 10 years is learn, grow, and not completely mess up on the job. Most people don't start doing their own deals until their 30's so if you still want to run your own deal then you start reaching out to your network of colleagues, friends, and family since you won't get an institutional dollar at that stage.
My thoughts exactly. I’m 38 years old and didn’t syndicate my first deal until age 34. Right now all you have to learn about is meeting the right people that do what you are looking to do and learn from them. Even if it means working in one area of CRE and just looking at them as an information source. Offer to buy them lunch if they will give you a couple of hours to map out how they structure their deals. Soak up as much as you can first, then worry about raising equity later on.
Thanks for responding. I know I can get an internship and land a job at greystar out of college. How long would you recommend staying in that job to learn and network with everyone before moving on to syndication? I already have a few family investors that could pull a decent chunk of money (arnd 25mm).
I guess what I’m really trying to figure out is how long does it take to learn the syndication game well and build a solid track record for investors other than family, because if I can learn the game well then I won’t have trouble finding investors at a young age. Thanks for your time as well.
Thanks for responding. I have a unique situation where in my early 20’s I have an family investors who would trust me with a few million dollars. I’m just wondering how long it’s takes to really get a solid grip on the RE world and syndication to branch off and run the deals on my own with a small team. Thanks for your time.
Frankly, you'll have a hard time convincing people to leave established careers to join your team if you're ~25 years old and investing family money. I'm towards the middle/back half of my career and I'll just speak for myself when I say that I don't think people get enough reps and see enough deals/cycles until they are at least 7-10 years into a career. People who started in ~2010 didn't really see any prolonged negative stretches in their career and they would be 13 years into a career at this point. If you run a small deal yourself and out-source the management to a 3rd party then using family money to get a 10-25 unit apartment complex is fine and once you have a couple successful full deals then maybe friends will invest and some family friends.
I own a few properties (nothing massive, just some cash flow and hopeful appreciation), and I gave myself one question that I had to answer and honestly reflect on before I decided to run my own deal..."do I know every aspect of the deal process, and would I make a dumb mistake in the process?". Seems like a simple question, but if you've never negotiated a PSA, gone through a comprehensive DD period, sourced and negotiated term sheets for debt, written up and reviewed operating agreements with equity sources, underwrote a million deals so you don't overlook anything and make "accurate" assumptions, done site visits and know what to look for, worked on asset management and making sure the property is still following the business plan and tracking to proforma, and things as basic as paid taxes and created budgets, then you don't know what you don't know. If your real estate knowledge came from a couple YouTube videos, training courses online, or reading posts about it on here, then you'll be hearing about the glamourous stuff like modeling new acquisitions and raising equity from big groups and massive promotes. But, I wouldn't trust someone to manage my money if they couldn't prove that they are able to competently complete all those process from start to finish multiple times while still receiving high returns.
TLDR; get a career in RE long enough that you can confidently tell people (and yourself) that you went through multiple deals start to finish at your day job and are ACTUALLY ready to take on the risk yourself of doing all those tasks and more.
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