Doing a deal with no promote just to get capital?
So I own some apartments, have in house management as well. We focus on around sub $10m deals. So nothing to big. We got two properties owned primarily through multiple family owners. However, I want to branch out a bit to outside capital. Since we do in house management, we're ok with collecting our initial fees from primarily management services and maybe an acq/disp fee if possible. My question is, to those in the LP space specifically, how enticing would be investing with someone willing to forgo promotes. I would do this just to gain the trust of others and build up a network. Is this possible? Since I dont have a huge track record and since my family has rarely ever sold real estate, we dont have realized returns.
TLDR - Want to raise outside capital, willing to remove promote, limited realized return track record, any chance of success?
If you’re willing to work cheap to build your brand, I think you’re better off forgoing acquisition/disposition fees and collecting a small promote. People are more willing to pay the new guy performance based fees.
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