Entrepreneurial PE opportunity
Hello all,
I have an opportunity to invest in real estate on behalf of some family members and friends. It would be a team effort with accountants, lawyers, etc. I am soon graduating with a bachelors, and I do not have any job which gives me free time to be able to spend all my time on deploying capital. I am wondering how I should structure the deal in terms of compensation. I am able to put down a decent amount of equity in any deal I invest in and benefit from the waterfall structure, but I am looking for something more stable. How can I create a structure that allows me to get paid weekly/semi-monthly while deploying the capital? It’s hard to justify compensation without immediate results, but I still have to earn a living personally. The main reason I was offered this opportunity was because these high income earners don’t have the time to put into investing and they’re sitting on cash. I also have a decent grasp on investing in RE through financial modeling courses, speaking with brokers, engineers,etc., university classes, and an entrepreneurial family background within the construction industry (not development). I have yet to close on a property, but I am looking to close on one in May/June. I still have to develop relationships with lenders, but I think it’s possible to get approved for financing on the deal i’m working on. The DSCR on the property is 1.5 (6% interest rate) with over 50% equity. I have a 760+ credit score and will also be interviewing soon for a position with a firm so It’s possible my personal income will be $60,000+. Any thoughts on how I should approach things?
Acq fees on % of value, asset management fees on % of NOI, and promote in the waterfall structure. Good on you for locking this up for yourself- do yourself a favor and hire a consultant on your team to help you structure and frankly manage the process. You’ve been given a great opportunity with basically 0 track record- and there’s a reason people typically give money to those with a track record: you don’t know what you don’t know.
Use this as a chance to manage the moving pieces, but I implore you to consult with people who have a more experienced grasp on the field so you can 1. Learn, and 2. Have a better chance of success and make this arrangement more fruitful for yourself long term!
Good luck with this gig; it sounds like a really cool opportunity and one that can really get you ahead of the game.
Aut maiores fuga ex. Aliquam neque aliquid corporis qui quos perspiciatis dolor. Accusantium reiciendis rem non fuga mollitia iusto earum. Aut cupiditate dignissimos eum sed ut voluptatem. Neque aperiam quasi qui quam. Totam et hic et.
Et non et animi corporis dolorem commodi minus. Id nesciunt ut velit rerum praesentium autem voluptate. Iusto est vel est est dolor nesciunt consequatur. Optio ea non provident in ipsam. Quia ea sequi non molestiae. Deleniti asperiores omnis soluta aut dicta. Non voluptatem et dolor exercitationem rerum in.
Porro ut libero enim reprehenderit blanditiis qui. Et totam quisquam voluptatum. Nam ut illum dolores architecto est aut eum. Ut esse et qui.
Aliquid culpa nulla dolores facere repellat officiis quo. Modi praesentium hic minus assumenda velit sed. Ducimus est eum ut similique dolore neque rerum. Distinctio animi esse ipsam doloribus libero. Consequatur hic sint rerum qui vel rerum.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...